The U.S. federal government’s program that provides cash benefits to low-income families with a disabled child has grown rapidly over the past 25 years. This growth reflects changes in the implementation of the program rather than declines in children’s health or family income. Unfortunately, most disabled children from families that receive such benefits do not become employed when they grow up, so these policy changes may relegate these children to lifetime government support—probably near the poverty threshold—at the expense of taxpayers. The federal Supplemental Security Income (SSI) program for disabled children provides cash benefits to low-income families with a disabled child. When the program began in 1974, about 71,000 disabled children received benefits, and program expenditures totaled around $40 million. As Figure 1 shows, the program is orders of magnitude larger today. In 2011, about 1.3 million disabled children received benefits at a cost of $9.3 billion. Program growth increased most rapidly immediately following the 1990 Supreme Court decision in Sullivan v. Zebley, which greatly expanded disability eligibility criteria for children. Welfare reform in 1996 tightened eligibility standards and slightly reduced the rolls for one year. However, since that time, recipients and expenditures have steadily increased. In this Economic Letter, we summarize the factors behind this growth (for a detailed discussion, se
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