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Our other pages on Social Security services focused on Social Security Disability Insurance and Supplemental Security Incomeand their applicability to those of us with lymphedema. They are only two of the services managed or administered by the Social Security Administration. The other main services involve the Social Security Retirement fund and the Medicare program.
June 20, 2008
Social Security is a mandated supplemental retirement system in the US that was established in 1935 as part of Roosevelt's New Deal. It was motivated largely by the events of the Great Depression, which saw many Americans out of work and the nation's retired elderly often left in the direst of poverty. The intent of the SocialSocialSocial Security program is to ensure a threshold subsistence level below which any worker who had paid into the program cannot fall.
Social Security is funded out of payroll taxes; that is, a certain percentage of a worker's paycheck goes directly into the SocialSocialSocial Security fund to help provide benefits to current Social Security recipients. This has in recent years become a bone of contention with some current workers, who complain that the system is unsustainable and that after paying into the system their entire working lives, there will be nothing for them to collect in their own retirement years.
Social Security has long been the so-called 'third rail' of American politics, an analogy to the electrified third rail on the subway systems. Touch it and you're dead. SocialSocialSocial Security is an enormously popular program to a very large and powerful portion of the electorate – the retired and the soon-to-be-retired. Any attempt to change the program runs the risk of incurring their wrath, and elected officials are notably reluctant to anger such a powerful group of voters.
Recent attempts to put Social Security on a more sustainable footing centered on the notion of 'privatizing' it. That is, it was suggested that workers be allowed to invest their own contributions in the stock market, opting out of the defined benefits of the Social Security system in favor of a 'defined contribution' system. One major defect in this proposal is that it never addresses the issue that caused the creation of the Social Security system in the first place – that is, what happens in economic hard times when the payouts from one's private investments diminish or there are widespread business failures that leave retirees with no income at all?
Rhetoric aside, the Social Security system is more solvent than the system reformers would like you to believe. Current estimates are that funds flowing into the system will be greater than or equal to funds flowing out of the system for several decades. Recent shortfalls in private retirement plans, such as those being experienced by the major airlines, have made it clear that whether or not privatizing Social Security is a good idea, it is certainly politically impossible right now.
On June 8, 1934, President Franklin D. Roosevelt, in a message to the Congress, announced his intention to provide a program for Social Security. Subsequently, the President created by Executive Order the Committee on Economic Security, which was composed of five top cabinet-level officials. The committee was instructed to study the entire problem of economic insecurity and to make recommendations that would serve as the basis for legislative consideration by the Congress.
The CES assembled a small staff of experts borrowed from other federal agencies and immediately set to work. In November 1934 the CES sponsored the first-ever national town-hall forum on Social Security. The CES did a comprehensive study of the whole issue of economic security in America, along with an analysis of the European experience with these perennial problems. Their full report was the first comprehensive attempt at this kind of analysis in many decades and it stood as a landmark study for many years. In slightly more than six months, the CES developed a Report to the Congress and drafted a detailed legislative proposal.
In early January 1935, the CES made its report to the President, and on January 17 the President introduced the report to both Houses of Congress for simultaneous consideration. Hearings were held in the House Ways & Means Committee and the Senate Finance Committee during January and February. Some provisions made it through the Committees in close votes, but the bill passed both houses overwhelmingly in the floor votes. After a Conference which lasted throughout July, the bill was finally passed and sent to President Roosevelt for his signature.
The Social Security Act was signed into law by President Roosevelt on August 14, 1935. In addition to several provisions for general welfare, the new Act created a social insurance program designed to pay retired workers age 65 or older a continuing income after retirement. (Full Text of President Roosevelt's Statement At Bill Signing Ceremony.)
Major Provisions Of The Act
The Social Security Act did not quite achieve all the aspirations its supporters had hoped by way of providing a “comprehensive package of protection” against the “hazards and vicissitudes of life.” Certain features of that package, notably disability coverage and medical benefits, would have to await future developments. But it did provide a wide range of programs to meet the nation's needs. In addition to the program we know think of as Social Security, it included unemployment insurance, old-age assistance, aid to dependent children and grants to the states to provide various forms of medical care.
The two major provisions relating to the elderly were Title I- Grants to States for Old-Age Assistance, which supported state welfare programs for the aged, and Title II-Federal Old-Age Benefits. It was Title II that was the new social insurance program we now think of as Social Security. In the original Act benefits were to be paid only to the primary worker when he/she retired at age 65. Benefits were to be based on payroll tax contributions that the worker made during his/her working life. Taxes would first be collected in 1937 and monthly benefits would begin in 1942. (Under amendments passed in 1939, payments were advanced to 1940.)
The significance of the new social insurance program was that it sought to address the long-range problem of economic security for the aged through a contributory system in which the workers themselves contributed to their own future retirement benefit by making regular payments into a joint fund. It was thus distinct from the welfare benefits provided under Title I of the Act and from the various state “old-age pensions.” As President Roosevelt conceived of the Act, Title I was to be a temporary “relief” program that would eventually disappear as more people were able to obtain retirement income through the contributory system. The new social insurance system was also a very moderate alternative to the radical calls to action that were so common in the America of the 1930s.
Another provision of the Act established a Social Security Board (SSB) comprised of three members appointed by the President, with the chairman reporting directly to the President. The original members were John G. Winant, Chairman; Arthur J. Altmeyer; and Vincent M. Miles. (Winant was a former three-time Republican Governor of New Hampshire; Miles was a Democratic Party official in Arkansas; and Altmeyer was a civil servant working in Labor Department.)
During the first year, SSB was faced with the tasks of providing employers, employees and the public with information on how earnings were to be reported, what benefits were available and how they were to be provided. In addition, sites for field installations had to be chosen and personnel to staff these offices had to be selected and trained.
First meeting of the Social Security Board, September 14, 1935. Left to right: Arthur J. Altmeyer, John G. Winant (Chairman), and Vincent M. Miles.
Operation of the new program was hampered for several months when the budget bill for the Act was killed by a Senate filibuster at the end of August 1935. The new Social Security Board had to borrow money from other federal agencies to operate until January 1936 when the Congress reconvened and passed an appropriation to fund the programs and operations under the Social Security Act.
The Social Security Board begin as an independent agency of the federal government. In 1939 it became part of the cabinet-level Federal Security Agency, and in 1946 the SSB was abolished and replaced by the current Social Security Administration.
Excerpt From: Historical Background and Development of Social Security
For extended historical information, please see: Social Security History
Social security is designed, as the title suggests, to provide security. To protect individuals from unforeseen catastrophes, the government spreads certain risks among all members of society so that no single family bears the full burden of such occurrences.
In the United States, the Social Security Program was created in 1935 (42 U.S.C. 301 et seq.) to provide old age, survivors, and disability insurance benefits to workers and their families. Unlike welfare, social security benefits are paid to an individual or his or her family at least in part on the basis of that person's employment record and prior contributions to the system. The program is administered by the Social Secuirty Administration (SSA) and since 1965 it has included health insurance benefits under the Medicare program. While the original act used Social Security in a broad sense and included federally funded welfare programs and unemployment compensation within its scope, current usage associates the phrase with old age, survivors, and disability insurance.
The Federal Old Age, Survivors, and Disability Insurance (OASDI) pays out monthly benefits to retired people, to families whose wage earner has died, and to workers unemployed due to sickness or accident. Workers qualify for its protection by having been employed for a minimum amount of time and by having made contributions to the program. Once an individual has qualified for protection, certain other family members are, as well. Financial need is not a requirement.
While the Social Security Act (federal law) governs an applicant's right to benefits, state substantive law governs some of the family relationship issues that may bear on that right such as the validity of a marriage.
For greater detail on all these points visit the LII's Social Security Library.
The Social Security Handbook includes the provisions of the Social Security Act (the Act), regulations issued under the Act, and precedential case decisions (rulings). It is one of numerous publications about the Social Security programs. It is a readable, easy to understand resource for the very complex Social Security programs and services.
The Social Security programs are so complex it is impossible to include information about every topic. However, we have included what we believe is the most common and helpful information. In case of a conflict between the contents of the Handbook and the Act, Regulations, and Rulings, the latter take precedence.
Information about benefit programs administered by other agencies can be found at Government Benefits.
This is the ultimate Social Security Disability Guide *This is the name of the website, not the author's personal opinion.
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Updated Nov. 29, 2011