Difference between revisions of "Social Security"

Revision as of 13:24, October 26, 2009

Social Security is a compulsory social insurance program primarily for old people and the disabled, sponsored by the U.S. federal government. It is strongly endorsed by all major conservative politicians in recent decades, and was expanded by presidents George W. Bush and Dwight D. Eisenhower, and put on a stable financial basis by Ronald Reagan. Social Security includes Medicare, starting in 1965, which covers medical costs of beneficiaries.

Social Security is part of the Welfare State, but it is not considered a welfare program because the beneficiaries have paid into it all their working lives.

Social security programs were first introduced by conservatives and pro-business politicians, such as Otto von Bismark in Germany and Winston Churchill in Britain, in order to weaken Socialism. All developed countries have a system somewhat similar to the U.S.

History

In 1889 Germany was the first country to introduce government pension plans. Britain introduced its program in 1907.

In the United States Social Security was passed by Congress in 1935, endorsed at the 1936 election, and started operations in 1937. Since benefits required at least 5 years of payments, a special program was included in 1937 to help old people who already were retired and who had high rates of poverty.

The Social Security Act was drafted by President Franklin Delano Roosevelt's committee on economic security, under Edwin E. Witte, and passed by Congress as part of the New Deal. It was opposed by conservatives at first, but they came to support it. Indeed, Social Security has been called the "third rail of American politics" because politicians get badly burned if they try to tamper with it. In 2009 conservatives attacked the Democrats health care reform program because it involves large cut-backs to Medicare.

In 1956 the US Congress enacted the Medicare program which guaranteed affordable health care to citizens over the age of 65. A Medicaid program was established to provide health care for those who could not afford private health insurance.

Today most developed nations have an extensive social security system, however the United States are an exception compared to Western Europe, Japan and Australia.

Social security will face many problems in the 21st century, most notably the aging of the population in developed nations, although more problematic in Europe and especially Japan, will strain American social security budgets ^[1]

Social Security and African-Americans

When Social Security was first passed most blacks worked on farms or as domestics and were not covered. Nealry all have left the farms--and the the few remaining domestics are now covered.

The amount of social security benefits received depends on how long one lives after retiring. African-Americans generally have lower life expectancies than other groups. When a black man reaches age 65, he is expected to live only another 13.9 years, almost 2 years (24 payments) less than a white male. The RAND Corporation concluded that, because of differences in life expectancies and marriage rates, on a life-time basis the income transfer from blacks to whites is as much as $10,000 per person. However, blacks aree more likely to receive disability benefits.

African-Americans are much more likely than other groups to be largely dependent on Social Security for retirement income.

Reform

Is Social Security going bankrupt?^[2] Actuaries say that thanks to the Reagan reforms of 1983, Social Security is fullly funded for 75 years. Medicare is much harder to gauge, because no one knows the future rate of growth of medical costs, which have been quite high in recent decades.

Pro's and cons of social security

This is a list of the most common arguments used in favour of, and against social security, some may not apply to American social security, since it is not as extensive as that of other developed nations.

Pro's

Safety Net

Guaranteed affordable health care for everyone over 65.
Guaranteed income for the elderly who can't afford a private pension plan.

Security

Pensions can not "disappear" because of fraud within a pension fund, or because a pension-funds goes bankrupt.
Victims of an economic recession won't fall into extreme poverty.
Social security decreases extreme poverty, which in turn decreases crime ^[3].

Con's

Individual Empowerment: individuals would have more motivation to work hard and succeed, this does however doesn't benefit the disabled and the economy is unpredictable (recessions).

Higher Returns and Greater Benefits: even the most conservative investors would accrue substantial assets during their lifetimes through privately invested accounts, yielding far more than Social Security promises in retirement income.

Improved Economy: economists believe that the overall economy will benefit from an increase in savings and investment resulting from this system.

Some individuals will get "lazy" and choose not to work, only costing society.

References

↑ Will social security and Medicare remain viable as the US population is aging? (pdf) Henning Bohn[1]
↑ Social Security Commissioner, 2006 Social Security Statement
↑ Poverty, Income Inequality, and Violent Crime: A Meta-Analysis of Recent Aggregate Data Studies Ching-Chi Hsieh [2]

[1] Will social security and Medicare remain viable as the US population is aging? (pdf) Henning Bohn[1]

[2] Social Security Commissioner, 2006 Social Security Statement

[3] Poverty, Income Inequality, and Violent Crime: A Meta-Analysis of Recent Aggregate Data Studies Ching-Chi Hsieh [2]

[1]

[2]

[3]

@@ Line 1: / Line 1: @@
-<div style="width: 70%; margin: 0 15% 1em 15%; text-align: center; background-color: #DEE6ED; padding: 0.5em; border: solid 1px 	#6699CC;">
+'''Social Security''' is a compulsory social insurance program primarily for old people and the disabled, sponsored by the U.S. federal government. It is strongly endorsed by all major conservative politicians in recent decades, and was expanded by presidents [[George W. Bush]] and [[Dwight D. Eisenhower]], and put on a stable financial basis by [[Ronald Reagan]]. Social Security includes [[Medicare]], starting in 1965, which covers medical costs of beneficiaries.
-This article has been identified as having a '''lack of credible references'''. You can and are encouraged to make this article better by contributing. Please locate accurate and reliable reference sources for this article. Please remember to abide by [[Conservapedia:Commandments|The Conservapedia Commandments]] in your actions, though.
-</div>
-<includeonly>[[Category:Articles needing proper referencing]]</includeonly>
-'''Social Security''' is a compulsort social insurance program primarily for old people and the disabled, sponsored by the U.S. federal government. It is strongly endorsed by all major conservative politicans in recent decades, and was expanded by presidents [[George W. Bush]] and [[Dwight D. Eisenhower]], and put on a stable financial basis by [[Ronald reagan]].
-Social security programs were first introduced by conservatives and pro-business politicians, such as [[Otto Von Bismark]] in Germany and [[Winston Churchill]] in Britain, in order to weaken Socialism. All developed countries have a system somewhat similar to the U.S.
+Social Security is part of the [[Welfare State]], but it is not considered a welfare program because the beneficiaries have paid into it all their working lives.
+Social security programs were first introduced by conservatives and pro-business politicians, such as [[Otto von Bismark]] in Germany and [[Winston Churchill]] in Britain, in order to weaken Socialism. All developed countries have a system somewhat similar to the U.S.
 ==History==
@@ Line 11: / Line 9: @@
 In 1889 Germany was the first country to introduce government pension plans.  Britain introduced its program in 1907.
-In the United States Social Security was passed by Congress in 1935, endorsed at the 1936 election, and started operations in 1937. Since benefits required at least 5 years of payments, a special progarm was included in 1937 to help old people who already were retired and who had high rates of poverty.
+In the United States Social Security was passed by Congress in 1935, endorsed at the 1936 election, and started operations in 1937. Since benefits required at least 5 years of payments, a special program was included in 1937 to help old people who already were retired and who had high rates of poverty.
-The Social Security Act was drafted by President [[Franklin Delano Roosevelt]]'s committee on economic security, under Edwin E. Witte, and passed by Congress as part of the [[New Deal]]. It was controversial when originally proposed, with one point of opposition being that it would cause a loss of jobs. Historians such as Edward Berkowitz subsequently contended that the Act was a cause of the "Roosevelt Recession" in 1937 and 1938.
+The Social Security Act was drafted by President [[Franklin Delano Roosevelt]]'s committee on economic security, under Edwin E. Witte, and passed by Congress as part of the [[New Deal]]. It was opposed by conservatives at first, but they came to support it. Indeed, Social Security has been called the "third rail of American politics" because politicians get badly burned if they try to tamper with it. In 2009 conservatives attacked the Democrats health care reform program because it involves large cut-backs to Medicare.
 In 1956 the US Congress enacted the [[Medicare]] program which guaranteed affordable health care to citizens over the age of 65. A [[Medicaid ]] program was established to provide health care for those who could not afford private health insurance.
@@ Line 19: / Line 17: @@
 Today most developed nations have an extensive social security system, however the United States are an exception compared to Western [[Europe]], Japan and Australia.
-Social security will face many problems in the 21st century, most notably the aging of the population in developed nations, although more problematic in Europe and especially Japan, will strain American social security budgets <ref>Will social security and medicaire remain viable as the US population is aging? (pdf) <i>Henning Bohn</i>[http://www.econ.ucsb.edu/~bohn/papers/Aging.pdf]</ref>
+Social security will face many problems in the 21st century, most notably the aging of the population in developed nations, although more problematic in Europe and especially Japan, will strain American social security budgets <ref>Will social security and Medicare remain viable as the US population is aging? (pdf) <i>Henning Bohn</i>[http://www.econ.ucsb.edu/~bohn/papers/Aging.pdf]</ref>
 ==Social Security and African-Americans==
+When Social Security was first passed most blacks worked on farms or as domestics and were not covered.  Nealry all have left the farms--and the the few remaining domestics are now covered.
-African-Americans pay too much into Social Security while working and get back too little in retirement benefits to make Social Security a viable benefit. {{fact}}
+The amount of social security benefits received depends on how long one lives after retiring. African-Americans generally have lower life expectancies than other groups. When a black man reaches age 65, he is expected to live only another 13.9 years, almost 2 years (24 payments) less than a white male. The RAND Corporation concluded that, because of differences in life expectancies and marriage rates, on a life-time basis the income transfer from blacks to whites is as much as $10,000 per person.  However, blacks aree more likely to receive disability benefits.
-The amount of social security benefits received is partly dependent on the length of one's life, and African-Americans generally have lower life expectancies than other groups.{{fact}} When a black man reaches age 65, he is expected to live only another 13.9 years,{{fact}} almost 2 years (24 payments) less than a white male. The RAND Corporation concluded that, because of differences in life expectancies and marriage rates, on a life-time basis the income transfer from blacks to whites is as much as $10,000 per person.{{fact}}
-African-Americans often do not have enough money left over after paying taxes to save for retirement.{{fact}} Elderly African-Americans are much more likely than other groups to be totally dependent on Social Security for retirement income.{{fact}} Social Security's benefits are simply not enough: the poverty rates among black elderly women is 29 percent-almost twice the rate for all women.{{fact}}
-African-Americans would be among those with the most to gain from transforming Social Security into a system of individually owned, privately invested accounts, similar to IRAs or 401k plans.{{fact}} Social Security reform must be looked at in light of the alternatives.{{fact}} Incremental reforms to prop up the existing system-such as raising payroll taxes or cutting benefits-could disproportionately harm African-Americans.{{fact}}
-==Social Security and women==
-According to a study by researchers at Harvard University, virtually every woman-single, divorced, married, or widowed-would probably be better off financially under a system of personal retirement accounts, the earnings of which could be shared by spouses.{{fact}} The researchers studied 1,992 actual women who retired in 1981, and compared their Social Security benefits to what they would have received from a personal account that returned 6.2 percent.{{fact}} Every woman studied would have been as well off or better off with a personal account.{{fact}} Not one woman was worse off under a voluntary system. On average, personal accounts would have provided the single women with 58 percent more than Social Security and wives with 208 percent more.{{fact}} Those higher returns are critical to women's well-being in retirement. Today, Social Security leaves 13.6 percent of women in poverty. {{fact}} Research shows that it doesn't have to be that way.{{fact}} In addition, voluntary account plans typically include a safety net that can ensure that every woman's retirement income is at least at or above the poverty line.{{fact}}
+African-Americans are much more likely than other groups to be largely dependent on Social Security for retirement income.
 ==Reform==
-Social Security is going bankrupt.<ref>Social Security Commissioner, 2006 Social Security Statement</ref> The U.S. federal government's largest spending program, accounting for nearly 22 percent of all federal spending, faces irresistible demographic and fiscal pressures that threaten the future retirement security of today's young workers.{{fact}} According to the 2003 report of the Social Security system's Board of Trustees, in 2018, just 14 years from now, the Social Security system will begin to run a deficit.{{fact}} That is, it will begin to spend more on benefits than it brings in through taxes. Anyone who has ever run a business--or balanced a checkbook--understands that when you are spending more than you bring in, something has to give--you need to start either earning more money or spending less to keep things balanced. For Social Security, that means either higher taxes or lower benefits.{{fact}}
+Is Social Security going bankrupt?<ref>Social Security Commissioner, 2006 Social Security Statement</ref>  Actuaries say that thanks to the Reagan reforms of 1983, Social Security is fullly funded for 75 years.  Medicare is much harder to gauge, because no one knows the future rate of growth of medical costs, which have been quite high in recent decades.
-Even if Social Security's financial difficulties could be fixed by raising taxes or cutting benefits, the system would still need to be reformed. Social Security simply costs too much and pays too little. Social Security's rate of return on payroll taxes is dismal (about 2 percent) and declining. Workers deserve a retirement system that will make the most of their money.
-Social Security Reform would lead to an increase in national saving, with hundreds of billions of dollars invested through individual accounts every year.{{fact}} Those investments, in turn, would substantially increase national investment, productivity, wages, jobs, and overall economic growth.{{fact}} In addition, Social Security Reform would amount to an effective cut in payroll taxes, boosting productivity and employment.{{fact}} Martin Feldstein, of Harvard University, estimates that modernizing Social Security has a value of $10-$20 trillion to the U.S. economy and would permanently increase our GDP by 5 percent. That would translate into at least one million new jobs and an increase in annual income of $5,000 for a family of four.{{fact}}
 ==Pro's and cons of social security==
 This is a list of the most common arguments used in favour of, and against social security, some may not apply to American social security, since it is not as extensive as that of other developed nations.
 ===Pro's===
+====Safety Net====
-* Guaranteed affordable health care for everyone.
+* Guaranteed affordable health care for everyone over 65.
 * Guaranteed income for the elderly who can't afford a private pension plan.
+====Security====
-* Higher education becomes open to all social classes: chance to escape from the poverty cycle, people with high potential but small bank accounts can go to college.
 * Pensions can not "disappear" because of fraud within a pension fund, or because a pension-funds goes bankrupt.
 * Victims of an economic recession won't fall into extreme poverty.
 * Social security decreases extreme poverty, which in turn decreases crime <ref>Poverty, Income Inequality, and Violent Crime: A Meta-Analysis of Recent Aggregate Data Studies <i>Ching-Chi Hsieh</i> [http://cjr.sagepub.com/cgi/content/abstract/18/2/182]</ref>.
 ===Con's===
 * Individual Empowerment: individuals would have more motivation to work hard and succeed, this does however doesn't benefit the disabled and the economy is unpredictable (recessions).
@@ Line 76: / Line 56: @@
 <references/>
 [[category:New Deal]]
+[[Category:Welfare State]]