Independence Project for Veterans

  • Public-Policy Reform
  • 2015

With almost predictable regularity over recent years, the Department of Veterans Affairs has become embroiled in repeated scandals combining failed services with mushrooming backlogs. A root of the problem is an explosion in the number of former servicemembers who are now defined as disabled. Only 11 percent of all World War II veterans received disability payments. Among those who served in Vietnam, 16 percent got checks. But among the men and women who served after the 9/11 attacks, a whopping 45 percent have already applied for disability compensation after leaving the service, and that ratio will increase as this cohort ages.

Not only do close to a majority of former servicemembers now call themselves disabled, but under what has come to be known as the “disability-compensation escalator,” those on the rolls tend to ratchet up their official degree of disability every few years. Recipients can claim additional disabilities at any time, and it is very common for someone who goes on the books at “30 percent disabled” to later be re-rated at 40 percent, then 60 percent, etc.

The vastly increased recourse to disability checks, and the constant upward drift of benefits, combine to create terrible disincentives against work and independence. This hurts participants in many ways. Veterans who work not only have much higher income than those on the dole, they are also more likely to recover from their afflictions, and have better mental health, much bigger social networks, deeper self-esteem, and more stable family lives. So the disability “aid” increasingly pumped out by the federal government correlates with more joblessness, and less wealth, health, and happiness among veterans.

On top of these ill-effects for vets, the existing system is bad news for taxpayers. The cost of the veterans disability program more than tripled from 2000 to 2015, to an annual charge of $65 billion, and is still rising fast. The budget of the Department of Veterans Affairs is now ballooning more rapidly than any other major department of the federal government.

Despite all this, efforts to create a more humane and effective system for assisting wounded warriors have failed in Congress. There are simply too many interest groups with a stake in the status quo. To get around this public-policy gridlock, donors launched a bold effort in 2015 to find a better way of operating. Their privately funded experiment will turn disability benefits on their head—instead of trickling a lifelong stream of small monthly checks to vets that keep them in low-income dependency, the program will make heavy upfront investments in veterans with mild to moderate injuries so they can acquire the skills for their dream jobs, start businesses or trades, and otherwise upgrade their lives to the point where they can then support themselves in dignity. A wide variety of medical, technical, motivational, and economic incentives will be offered to each volunteer participant.

A wide variety of medical, technical, motivational, and economic incentives will be offered to each volunteer participant. In return they must commit themselves to stepping away from the disability dole and working toward self-reliance instead. In preliminary focus groups, 80-90 percent of disabled veterans leapt to take this deal.

The Independence Project was launched with a million-dollar grant from the Anschutz family of Colorado, then $4.1 million of funding from the John and Laura Arnold Foundation, another million-dollar grant from the Daniels Fund, $5 million from the Diana Davis Spencer Foundation, and support from the Milbank, Wilf, Morgridge, Weinberg, Snider, Kirby, Bradley, and Kovner foundations.

The program will allow a careful test of the “recovery and self-reliance” approach with groups of disabled vets. When results accumulate, the philanthropic backers will use the research findings for a public-education and policy-reform campaign aimed at remaking the major Veterans Affairs disability programs in this healthier and more fiscally sustainable form.

UPDATE: The Independence Project is currently enrolling qualified participants at