Social Security Disability
We IT geeks tend to be unusual. For example, one of my Catholic Newman buddies back at the University of Houston tended to hop from project to project when he needed money to meet his expenses vs. steady work for one company. An old high school girlfriend wondered why I didn't simply relocate back to Texas and work like one of her IT friends, who could make a living anywhere he had an Internet connection. (In theory I could do a similar thing and perhaps have been interviewed for a half dozen relevant gigs; and in one job (with SunGard Higher Education, an ERP publisher in the higher education space, back in 2008), I basically did such a role in a quasi fashion: the company was based out of Malvern,PA, but I mostly worked from home in MD unless I was training or providing training on site for clients. Among other things, customers could save on our travel expenses if we worked at home.)Now the IT industry isn't necessarily alarmed to see a lot of projects or clients on a resume. I've worked at consulting companies which would lay you off if you didn't have a scheduled follow-up project. I've worked for at least 3 companies that subsequently went bankrupt (two of them in the Internet economy bust). At one of them I remember working one week at least one day each for 4 different clients. I've worked on government contracts in their last year, only to see RFP's for a recompete canceled or positions eliminated in an awarded contract. But many traditional managers are ill at ease with "job hoppers". I remember talking to a recruiter for one contractor about the job hopper allegation, and he laughed, explaining many of his employees worked for 6 or more clients in a single year.
Now over the last couple of years I've occasionally discussed the social security disability reserve crisis. In essence, social security disability has morphed into an expanding secret welfare program for middle-aged blue-collar and other workers and their dependents, which has little to do with deteriorating health but widening criteria. Twenty years or so ago maybe 3 million were on social security disability; the number has more than doubled to almost 5% of the eligible workforce.
The 2015 Budget Act extended DI's day of reckoning from 2016 to 2022-3 by diverting some contributions intended for OASI (i.e., old age pension) reserves. This obviously is not sustainable because when you exclude Treasury interest payments on reserves, OASI has been operating at a deficit (relative to worker contributions) since 2010 on a pay-as-you-go basis; this means that reserves are slowly eroding to ensure that retirees receive their full promised contributions. If and when OASI reserves are depleted (estimate 2034), it doesn't mean that that retirees won't get checks (so long as there's a payroll tax mandate), but they'll receive a reduced check commensurate with payroll tax receipts. (Of course, politicians will eventually act to ensure full checks because the senior citizen lobby is extremely powerful.) This has been a known issue for a long time, with Bush squandering much of the political capital from his reelection pushing a partial privatization reform a dozen years back. Obviously diverting OASI funds to DI is like robbing Peter to pay Paul. No one in Washington relishes the politically unpopular idea of raising payroll taxes on most Americans, reviewing COLA adjustments, deferring eligibility, and/or means-testing of benefits. But clearly DI program overruns are part of the problem
I have an IT professional friend who has had a tough time holding down steady work for a number of years. His employer didn't have a problem with his technical performance but expressed a concern over some interpersonal issues. Many companies have an Employee Assistance Program which might mitigate certain issues, say, financial problems, alcohol or drug problems, or team conflicts. (Just to explain: from way back in my MIS coursework, I'm familiar with applied psychological studies, e.g., Cougar & Zawacki, showing that many IT personnel experience a lower social need but a higher growth need in their work. By "growth need" I'm referring to growing one's background and skills in technical areas. Most people are probably familiar with the geek stereotype, where the geek does not have much experience or success in dating relationships and while able to solve thorny technical issues with ease, are more uncomfortable or tentative in social situations.) So, for example, the EAP may suggest that a socially inept techie meet with a psychologist a few times to develop more effective strategies in coping with interpersonal issues at work.
My friend was in a state of denial over the issues at work, which he felt were exaggerated and considered the situation as politically contrived. But here's the salient point: the psychologist in reviewing his unusual work history suggested that he might be diagnosed with Asperger's Syndrome, which could support an application for social security disability. While my friend realizes autism is a serious issue, it was not relevant in his circumstance and pursuing a disability claim would be fraudulent, never mind contrary to his political belief system.
That millions of middle-aged workers are finding it difficult to find work is a tragedy. Welfare is morally hazardous and erodes one's own healthy self-image; most of us derive a measure of happiness and self-worth from being a contributing member of society. I have faced a number of challenges in my career; I never wanted to surrender my career as a professor in the middle of a recession; I found myself starting from scratch again as an IT professional. I've moved across the country, often at my own expense, to add clearances, certifications, and in-demand technical skills/experience to my resume. (Yes, it did help that I didn't have a wife and family depending on me during slow periods, but then I didn't have an emotional support system when I came home at the end of a day.) I don't have a magic solution for those having to reinvent themselves in their 50's or later. What I can tell you is economic nationalism and mercantilism are not the answer, that government does not create opportunities: it restricts and impedes them.
I Reached a Minor Milestone In My Retirement Savings
Some dividend payments from ETFs in my IRA's (traditional and Roth) over the weekend finally pushed me over a symbolic target for the first time (of course, the market could take it back tomorrow). I had been just shy of the target when the tech sector (with the FANG stocks (Facebook. Apple/Amazon, Netflix, Google)) recently corrected. Most of my recent transactions have been flat to slightly down except for one global health industry ETF up slightly. I did check my 401K plan at work (which I haven't modified over the past year in terms of choices, percentages, etc.) and was surprised to see it was up 7.5-8% for YTD--not bad considering the limited options. Do I think the Trump rally will continue? Certainly not at the same rate. And I'm keeping a lot of powder dry in the event of a correction.My gut feeling is the market will be positive over the coming year. But this is not a financial blog; past performance doesn't guarantee future results, do your own due diligence, and invest at your own risk.
