Social Security Since Its Inception the Social Term Paper

Download this Term Paper in word format (.doc)

Note: Sample below may appear distorted but all corresponding word document files contain proper formatting

Excerpt from Term Paper:

Social Security

Since its inception, the Social Security system has provided benefits to augment the income of people upon their retirement. However, current projections point to a crisis in Social Security. Experts believe that by 2038, the Social Security trust fund will have been depleted (Williamson).

This paper presents an overview of the current social security crisis and evaluates the plans to address this problem. The first part of the paper provides a history of the Social Security system, from its inception in 1935 to its current status under the federal government.

The next part then studies how the Social Security system is funded. In the final part, the paper studies the problems facing many retirees who stand to be adversely affected by the Social Security deficit. It looks at the pitfalls of privatization and other methods now being used to address the problem, such as proposed tax credits, simplifying the tax process and key changes in retirement policy.

The theory and legislation behind Social Security

On August 14, 1935 President Franklin Roosevelt signed the Social Security Act into law. This represented a shift from the previous American tradition of individualism and self-sufficiency to a form of a welfare state, patterned after late 19th century Germany and its national social insurance program. Before Roosevelt, the United States was one of the few remaining industrialized nations without such a program. Since the beginning of the 20th century, countries such as Australia, France, Great Britain, Spain and Venezuela had instituted social insurance systems designed to provide for the welfare of workers in the form of illness, old age and death benefits (Schieber and Shoven, 28).

The first workers were registered by January 1, 1937, when they also began accruing credits towards their old-age insurance benefits. The early applications were distributed through the U.S. Postal Service, with over 30 million new Social Security numbers being issued. After these numbers were assigned, the government then began collecting payroll withholding taxes, as mandated by the Federal Insurance Contributions Act (FICA). The first monthly benefits were issued in 1940 (Schieber and Shoven, 30).

Since its inception, the coverage and benefits of Social Security have been expanded. While the original Social Security Act was limited to only retirement benefits for the worker, two 1939 amendments added benefit payments to the retirees' dependents (spouse and to the minor children) and survivor benefits to the family in case a covered worker dies prematurely. Thus ushered in the Social Security program that is in place today, one that provides security and benefits for the family rather than just an individual worker (Schieber and Shoven, 31).

By the 1950s, society was becoming increasingly aware of the problems faced by disabled citizens. Towards this, a disability insurance program was added in 1956, to benefit disabled workers and disabled adult offspring. By 1960, an estimated 559,000 people received disability benefits averaging $80 per month (Schieber and Shoven, 31).

President Lyndon B. Johnson expanded Social Security benefits further in 1965 when he signed the Medicare Bill. Under this new law, the Social Security Administration created a new insurance program covering the health-related expenses of all Americans aged 65 or older (Schieber and Shoven, 35).

Social Security has undergone several changes since the 1960s, though the basic structure remains the same. In 1996, President Bill Clinton signed a law disallowing benefits if the disability was caused by drug addiction and alcoholism. In 2000, Congress changed the law further to allow full benefits for all citizens over the age of 65, even if they choose to continue working.

Funding for Social Security

The most common misconception regarding Social Security is equating SS benefits with welfare. This is not the case, since recipients of these benefits begin contributing to the Social Security fund as early as their first payroll employment.

The money for the Social Security fund comes from payroll taxes collected from both the employer and the workers, as mandated by the FICA law. These taxes then deposited into the common Social Security Trust fund and invested in United States treasury bonds. The income from these contributions funds the benefits of retired workers and their dependents.

When the Social Security system was first enacted, it was intended merely to supplement the income of retirees. However, statistics from the President's Commission to Strengthen Social Security (PCSSS) shows that half the elderly population depends on…[continue]

Cite This Term Paper:

"Social Security Since Its Inception The Social" (2003, May 12) Retrieved December 4, 2016, from http://www.paperdue.com/essay/social-security-since-its-inception-the-148877

"Social Security Since Its Inception The Social" 12 May 2003. Web.4 December. 2016. <http://www.paperdue.com/essay/social-security-since-its-inception-the-148877>

"Social Security Since Its Inception The Social", 12 May 2003, Accessed.4 December. 2016, http://www.paperdue.com/essay/social-security-since-its-inception-the-148877

Other Documents Pertaining To This Topic

  • Social Security IT s Been More

    Social Security can be an effective tool in public personnel administration and can benefit common American a great deal if used effectively. Therefore it is imperative to look into the future prospects of the programs and remove loopholes and bottlenecks in its future implementation. Future Under the Social Security plan government is collecting more money today then it is paying out as benefits to citizens. The surplus money remains safe in

  • U S Healthcare Reform Since the

    Effects on Current Position With "The Patient Protection and Affordable Care Act," many healthcare professionals are affected (Democratic Policy Committee, n.d.). Nationwide, hospitals are scrambling to buy hospitals in an effort to control costs. Doctors are leaving small private practices. Large insurance companies are becoming more dominant as smaller ones disappear because they cannot stay competitive (New York Times, 2011). Furthermore, Republicans denounced the law as an intrusion by the government

  • Social Need & Public Services

    The current state of the British welfare state is in flux, and according to Field (1999), only time will tell whether the reformation schemes and ideals are actually effective. Whether they are or not, they are nonetheless somewhat more realistic than the views held in the past. When Stephen Berry wrote his article in 2004, little seems to have improved, particularly for the NHS. The author focuses on the health crises

  • Social Economic Inequality

    Social Economic Inequality When people think of social inequity, they generally frame this in terms of socio-economic class. People who have accumulated much wealth occupy the top echelons of society and enjoy the most privileges as brought on by their money and social status. On the other end, people who are poor have little or no access to these privileges and are often marginalized in terms of education and social services. However,

  • Social Work With Children in

    I told her that there had been three caseworkers since I had been in foster care this time, but none of them had ever gone to visit my mom. She had been alone in all of this. It wasn't fair for her. The third caseworker visited my mom and saw how hard she was trying. I was able to go home overnight and then, finally, we were all back together again

  • Homeland Security and the War on Terror

    Homeland Security and U.S. Intelligence Formation of Department of Homeland Security & U.S. Intelligence on Terrorism Definition of Intelligence Rationale for Formation of DHS Effectiveness of DHS Importance of Intelligence & Analysts Research Philosophy Research Methods & Its Limitations Data Collection & Analysis National security has been a major concern for United States in past few decades. However, since 2001, this concern has turn into a serious threat for national security. The given research is performed with the intent

  • Retirement Portability Is a Hot

    As Geisel (2004) notes: Income-tax deductions are worth the most to high-bracket taxpayers, who need little incentive to save, whereas the lowest-paid third of workers, whose tax burden consists primarily of the Social Security payroll tax (and who have no income-tax liability), receive no subsidy at all. Federal tax subsidies for retirement saving exceed $120 billion a year, but two thirds of that money benefits the most affluent 20% of


Read Full Term Paper
Copyright 2016 . All Rights Reserved