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Social Security in America: History and Problems Report

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Updated: Sep 15th, 2021


Social Security is a form of insurance based upon a 19th century European tradition that dealt with social welfare. In 1912, Theodore Roosevelt made a plea before a convention of the Progressive Party where he indicated the stand that social security would eventually be based upon. He said:

We must protect the crushable elements at the base of our present industrial structure…it is abnormal for any industry to throw back upon the community the human wreckage due to its wear and tear, and the hazards of sickness, accident, invalidism, involuntary unemployment, and old age should be provided for through insurance.

by 1935 the social dynamics of the country had changed and the once farming reliant nation was now highly industrialized and facing various social and financial challenges in the process. Thus, the need to adopt a Social Security Act was shaped and born. Its features included an insurance principle that protects the policy holder against a defined risk and social element or situations. Social security usually covers disability, death, retirement, and unemployment.

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Then president Franklin D. Roosevelt did not get the act to pass without a problem though. He made known his intention to have Congress pass a Social Security program on June 8. 1934. Subsequently creating by Executive Order the Committee on Social Security. Their objective was to give the president an idea of the problem of economic insecurity and recommend possible moves that can be used in aid of legislation by Congress. By January 1935, the CES was in a position to advise the president and after filing their report, the president presented the same to both houses of Congress on January 17. The bill eventually passed with majority support and signed into law by President Roosevelt on August 14, 1935. One of the major provisions of the act that caught the notice of the public was the act indicating that the social insurance program would offer members over the age of 65, a pension or income after retiring from their current jobs.

But just like any act passed into law, the Social Security Act needed modifications over time in order to reflect the actual status and problems of society. So in 1939, amendments were made to cover the benefits received by spouses and children of the workers. These came to be known as dependent benefits.

Changes were also made to the governing structure of system. By 1950, the Social Security Board was abolished to give way to the Social Security Administration that was headed by a commissioner. Gradual changes were made as the system was tweaked in order to accommodate the growing needs of its new and aging members. In 1965, President Lyndon Johnson received the first Medicare card that would allow the retirees of the system to partake of health insurance in their golden years thus adding health benefits to the duties that the insurance had to provide.

But just like any insurance firm, the system is plagued by revenue collection problems and allotment issues. Although the finances of the SSA are professionally handled, that is not to say that it is not a troubled firm. The SSA remains somewhat mismanaged and is looking to privatization in order to solve its problems. But is privatization really the solution to what ails the system? No.

According to Congressman James E. Clyburn (6th district – South Carolina), threats of privatization and a bankrupt system are political ploys being employed by unscrupulous people who see the financial profits to be had by the government in such a scenario. It has nothing to do with protecting the members of extending the life of the benefits offered by the SSA. He even mentions in his statement that:

Unfortunately, today the politics of fear are being employed to scare Americans into believing there is a Social Security crisis. The logic that we must spend $2 trillion now while our government is operating at unprecedented deficits and under unimaginable debt in order to stave off a 25% shortfall in Social Security funds some 37 years from now is absurd at best and deceitful at worst. This is a smoke and mirrors argument to bolster the President’s desire to privatize the program and begin fulfilling the Republican Party’s goal of eliminating Social Security all together.

Due to the high number of Baby Boomers set to retire in the coming decade or so, the issue of Social Security has become a hot topic among the presidential candidates. Most notably, it has been a bone of contention between Senators Hillary Clinton and Barack Obama. They each have their own idea of how to reform and save social security and yet, nobody can say that one has the real solution and the other does not. Hillary Clinton believes that the key to fixing the social security problem lies in fiscal responsibility. It her opinion that by balancing budgets and surpluses, savings can be found that can be passed on to help the system recover and help the people it is mandated to protect. A view that I share as opposed to Sen. Obama’s proposal to tax the rich in order to close the budget gap. One thing the two candidates share in common though is their disapproval of privatizing the system as this will not solve any of the real problems and issues the system has.


In the end, we will come to realize the SSA is having problems, but is not in a crisis situation. It is just unfortunate the Democrats and the Republicans both have their own political agendas that they insist on making fit the actual situation of Social Security in the country today.

Work Cited

Cong. Clyburn, James E. “Privatization of Social Security Threatens America’s Future Security”. Capitol Column. 2005. Web.

Dewitt Larry. . SSA Historian’s Office. (2003). Web.

Lindner, Sarah. “Where Hillary Clinton and Barack Obama Stand On 4 Key Consumer Issues”. statesman.com. 2008. Web.

Ydstie, John. NPR. 2007. Web.

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IvyPanda. 2021. "Social Security in America: History and Problems." September 15, 2021. https://ivypanda.com/essays/social-security-in-america-history-and-problems/.


IvyPanda. (2021) 'Social Security in America: History and Problems'. 15 September.

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