The Pros And Cons Of The Social Security Act

When Roosevelt signed the Social Security Act in 1935, it was designed as a safety net and was intended to protect American workers upon retirement, disability or in the event of an early death. This program is the largest government program in the world and uses a pay-as-you-go system where workers contribute 6.2% of their salaries into the plan and come time to give up work, and they will be eligible to receive a limited monthly income to assist them during retirement. In other words, the individuals working today are paying for the former workers now in retirement, hoping that others will do the same when it comes their time to retire. Those who have contributed can start collecting these aids at 62 with the amount paid per month reduced, while workers who retire at age 67 will receive their benefits in full. The Social Security program has had some complications back in 1980’s due to budget …show more content…
These changes would be just the beginning of obstacles that lie ahead. Per Procon.org. An early sign of financial distress to come, was when 57 million Americans got denied their cost of living adjustment (COLA) in their allowances. This brought awareness because it was the first year without the automatic adjustment since COLA got introduced in 1975. In an article, Procon.org. Claims that “According to the 2009 annual report of the Social Security Board of Trustees, the program faces a budget shortfall of more than $15 trillion over the next 75 years.” (Procon.org, 2015, p.1) Because of this, many predict that the funds for Social Security will be insolvent by 2037. For this program to achieve long-range solvency, the benefit cuts, and tax increases need to be twice as much as needed than ten years