The Social Security Act of 1935, enacted during President Franklin D. Roosevelt, has become a third rail in today’s American society. By third rail, various scholars explain that if a politician these days were to try to alter or change the structure of the law dramatically, then they could essentially destroy their political career. One must understand how the United States gained this transformative law through our country’s history, both the official and non official actors involved in enacting the act, different alternatives to the policy, how it was implemented, and the changes it has faced since 1935.
Every step taken from the emerging issue that brought the Social Security Act to life, to the controversies it faces today; have to be evaluated to gain a deeper understanding on its significance in the United States. Differing research techniques were used to evaluate social security, including but not limited to, various government documents and statistics, pioneers in the social security field’s printed works, and more.
The Social Security Act of 1935 is significant to everyone today because the millennial generation, specifically current college aged students, are projected to be he first generation to pay for social security benefits of others without reaping the rewards themselves once they reach retirement. The law is additionally important to evaluate to understand how it impacts this country so significantly, year after year. To begin, the Social Security Act of 1935 stemmed from one of the greatest economic tragedies the United States has ever witnessed.
After World War I, the society was finishing its transformation from a previously agricultural society to an industrial society. This was leaving millions out of jobs because they were not capable of keeping up with the ever-changing job arket. By the 1930’s, the United States was officially what is coined, the Great Depression. In 1932 the unemployment rate raised to 34% for non-agricultural workers, the national income dropped to 43%, the per capita income dropped by 19%, and the lifetime savings of thousands was completely erased.
The elderly were “Literally penny-less”, and approximately one half of the old age population was relying on family members or friends for total support. Prior to the Social Security Act, the only financial assistance came from various charities and non-profit organizations; however, their services were not adequate nough for the care the elderly needed to live. The country knew that something had to be done to begin digging out of the economic pit.
Continually, when the national government decided to step into action and begin proposing the Social Security Act of 1935, there were other policies already in place trying to solve the problem. Nearly thirty states were on track to providing pensions to the elderly through various policies. However, these had some faults because the pensions would cut spending in other programs dramatically and/or would take money from other individuals who were suffering greatly from the epression as well but simply weren’t within the pension age group.
Moreover, there were national “schemes” in place prior to the law to attract national attention on the elderly economic depression. One of these was called the Townsend Old Age Revolving Pension plan and stated that every American who was over the age of sixty years old would receive a monthly payment pension if unemployed and would be required to spend the entirety of their payment in that month. Another national plan that was in place for similar reasons was the Share the Wealth plan in which large monetary amounts from individuals were llocated for pensions for the elderly.
All of these policies are examples of minor steps that pushed the social security agenda. Franklin D. Roosevelt is a salient president in this country’s history for multiple reasons, including being the only president to serve more than two terms. One of these key reasons is the Social Security Act. When he began the proposal process to the legislative branch, he actually never used the terms ‘social security’. This is quite significant and sometimes overlooked when defining a problem and framing an issue.
FDR would often refer to the plan as economic security to be favorable from both he democrats and the republicans. Another emphasizing term used to frame social security was it’s focus on “Elderly assistance” and that the law is a child of the Great Depression, thus making social security seem innocent and innovative. Altymer states paraphrases President Roosevelt ‘s description as “Furthering the security of the citizen and his family through insurance”.
At the time of the law’s enactment, the specific problem being addressed was economic insecurity within the United States and moreover, the economic depression faced by the elderly and caregivers of the elderly. However, as legislation continued, the ssues evolved into old age pensions, unemployment compensation, contributory and noncontributory old age insurance, public assistance for the support of dependent children, federal grants to states that supported the new public health programs, disability insurance, and various welfare programs.
As with all forms of public policy, there are various actors involved in the different steps to policy formulation. The official actors for the Social Security Act broadly include the legislative branch, the executive branch, and the judicial branch. President Roosevelt was absolutely essential in the social security act and he role of the Supreme Court during the 1930’s. Previous Court decisions on the federal government becoming involved in social policy suggested that it would not declare the act constitutional.
Knowing this, FDR presented legislation to Congress that would add one justice to the Court whenever there was a justice over the age of seventy in order to “Relieve the work load burden”. However in his description of the bill it was clear that his true intentions were to pack the, currently evenly leveled, Supreme Court to a more liberal Court in order to protect the Social Security Act. The Supreme Court justices ust have been fearful of this being passed after months of Congress debating it because they changed their original views on the policy, declaring it constitutional.
This created a constitutional revolution during Roosevelt’s era. Comparatively, the law faced and always will face evaluation on different alternatives to social security. There are four alternatives discussed in various literatures; individual responsibility, means tested payments, universal pensions, and double-decker benefit plans. The individual responsibility alternative theorizes that since the establishment of the Social Security Act, there has been a large expansion in private industry for both group insurance programs and private pension programs, meaning individuals have multiple options outside of the federal government.
Another portion of the individual responsibility alternative suggests that personal savings should be used more frequently but is problematic because individuals repeatedly do not save enough money to suffice their needs when necessary. Secondly, the means tested payments alternative offers a plan where people who are receiving social security are reevaluated at certain time periods to ensure that nly ones who are presently in need of the benefits are receiving them.
Thirdly, the universal pensions alternative is quite different than what is currently being offered and the previous two alternatives. This idea offers a flat pension to anyone over a certain age or who reaches retirement; it removes all eligibility test and guarantees benefits. Lastly, the double decker benefit plan is similar to the universal pensions except that is also considers cost related benefits. This alternative provides a minimum, flat, payment at the very least and then will also take other options into considerations.
