Which party created social security?

Social Security was created as a response to the economic impact of the Great Depression, as part of President Franklin Roosevelt’s New Deal domestic program. It was designed to provide benefits for retired workers, the jobless, dependent spouses and children, and people with disabilities. However, there is a debate on who created Social Security. 

The Social Security Act was signed into law on August 14^th, 1935 by President Franklin Roosevelt, a member of the Democratic Party. When the "Social Security Act of 1935" bill was presented to congress, it was passed with majority support from Democrats and little support from Republicans. In the House of Representatives, the bill was passed by a vote of 372 to 33, while in the Senate, the bill was passed by a vote of 77 against 6, with a majority of Democrats voting in favor of the bill in both houses.

Which political party created Social Security?

The Social Security Act was passed into law on August 14, 1935, by US President Franklin Roosevelt, a member of the Democratic Party. Before the Social Security Act became law, President Roosevelt set up the committee on Economic Security in 1934 to develop a social welfare program proposal.

When the 74^th Congress convened in January 1935, the committee’s proposal was introduced to Congress as the “Economic Security bill” by Senator Robert Wagner (New York) and Representative David Lewis (Maryland) for hearing and debating. During the debate, the name of the bill changed to the “Social Security Act of 1935.”

The bill was passed in the house on April 1935 with 372 to 33 votes, with a majority of Democrats voting in favor of the bill. In the Senate, the bill was passed in June 1935 by a vote of 77 against 6, with a majority of Democrats voting in favor of the bill. The bill passed in both houses with strong support from Democrats and little support from Republicans.

History of the Social Security Act

The Social Security Act is a law that established a system for old-age retiree benefits, unemployment insurance, benefits for victims of industrial accidents, benefits for dependent mothers and children, benefits for people with disability, and benefits for people who are blind. Before the act was signed into law, support for elderly workers was limited to state and local governments, and there were no federal support systems.

Due to the economic impacts of the Great Depression, there were calls for a national old-age insurance system to support retired workers. At least five million retired workers joined nationwide Townsend clubs in the early 1930s to demand a $200 monthly pension for people above age 60. The widespread impact of the Great Depression prompted calls for congressional support for a national insurance system.

President Roosevelt set up the Committee on Economic Security (CES) in June 1934, tasked with the responsibility of creating an economic security bill. CES drafted the Social Security Act, which provided various recommendations on an old-age pension, unemployment insurance, financial assistance for mothers and children, and financial assistance for disabled workers and people who are blind.

Eventually, the bill was presented to both houses for debate in 1935, and Congress voted to pass the bill. In August 1935, President Roosevelt signed the Social Security Act into law. The new law provided old-age benefits funded by payroll taxes on both employees and employers. It also authorized the Social Security Board to enroll citizens for benefits, administer contributions, and disburse payments to eligible beneficiaries.

Since the Social Security Act was enacted, it has been subject to various amendments to expand coverage, and bring more workers into the system, while adjusting taxes and benefits to keep up with inflation.

Why was the Social Security program created?

The Social Security program was created in response to calls for a national Social Security program to protect old-age workers. It was designed to provide economic security to American workers and their dependents.

Originally, the Social Security Act provided old-age benefits to retired workers, aid to dependent children, and unemployment insurance to workers who become unemployed. The law created Aid to Dependent Children program to provide financial assistance to families headed by single mothers and the unemployment insurance program administered by states to provide temporary relief to unemployed workers.

When Social Security began paying benefits, payments were made in lump sums until 1940 when a monthly payment system was adopted. The program was designed to be funded by a payroll tax from both the employer and employee.

How has the Social Security Act changed?

Over the years, various amendments have been made to the original Social Security Act. Here is an overview of how the Social Security Act has changed over time:

Dependents and survivors of retired workers

The 1939 amendments expanded the Social Security coverage to include payments to the spouse(s) and children of retired workers, as well as payments to families of deceased workers. The amendments allowed retirement-age spouses, minor children, widowed mothers of minor children, and aged widows to receive Social Security benefits.

Disability benefits

In 1956, a new law created disability benefits for older workers. In 1960, President Eisenhower signed into law amendments allowing disabled workers of all ages and their dependents to receive Social Security benefits.

Payroll tax rate

The original Social Security tax rate was 1% of earnings, with an equivalent employer’s match. This rate has gradually increased to 1.5% in 1950, 5% by 1978, to 6.2% in 1990. The 6.2% tax rate has remained in place till today. Also, the tax rate is applied on earnings up to a specific limit- the limit has increased from $51,300 in 1990 to 160,200 in 2023.

Full retirement age

Originally, the Social Security Act allowed workers to claim benefits starting from age 65. However, a 1961 amendment allowed workers to claim reduced benefits at age 62. Later in 1983, Congress passed a law that increased the full retirement age to 66 and 67, depending on the year of birth. The amendments also allowed increased payments for workers who delay claiming benefits after reaching the full retirement age until age 70.

Cost of living adjustments

When Social Security was established, a cost of living adjustment was only granted to recipients after Congress approval. In 1972, Congress approved an amendment that approved automatic cost of living adjustments based on annual increases in consumer prices.