Thursday, October 27, 2011

The LIRR Disability Scandal

The NY Times reported back in 2008 that an outrageous number of Long Island Railroad employees were claiming disability pensions -- almost every union employee, in fact, giving them a disability rate about 4 times that of the average railroad. Now the US attorney's office has finally issued indictments in the case:

Ten people, including a doctor and a former union president, were arrested early Thursday and charged in a major fraud scheme in which hundreds of Long Island Rail Road workers made false disability pension claims costing a federal agency an estimated $1 billion, according to people briefed on the matter. Another doctor charged in the case was being sought, the people said.

Most of the people — those charged in the case include seven former railroad workers accused of making false pension claims, the two doctors and a former federal railroad pension agency employee who helped the workers file the claims — were taken into custody in the early morning hours at their homes by F.B.I. agents and state investigators, the people said.

I think this is a crucial matter for the future of America. It seems inevitable to me that the retirement age is going to rise, as people live longer and longer and many of us put off entering the work force for more and more schooling. But if the retirement age rises to 70, we will need some means of taking care of people who have really worn out their bodies doing decades of physical labor. Some countries have separate pension arrangements for manual laborers vs. others, but I doubt America will ever go that way. So we will keep using the disability system, allowing worn out workers to claim that they are disabled and get earlier pensions that way. But if people think this system is being widely abused, they will rebel against it and shut it down, leaving us with no way to care for people who genuinely can't work any more at 65. So it is of the highest importance to safeguard the integrity of the system, and kudos go to these prosecutors and to the Times reporters who broke the story (Walt Bogdanich, Andrew W. Lehren, Robert A. McDonald and Nicholas Phillips).

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