Economic Feasibility of the Social Security System

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Will Social Security Survive the 21st Century? With all the concerns surrounding the economic feasibility of the Social Security system, perhaps the question should be asked whether the Social Security system would last another 20 years if drastic changes were not made soon. In the years leading up to 2011, when the first baby boomers would be eligible to start receiving Social Security benefits, alarms began to sound that the system was headed for trouble as this new deluge of retires, totally 77 million would soon bankrupt the system (Economics Resource Center, 2002). Without changes to the current pay-as-you-go system, chances are Social Security will not survive the 21st century and will go down in history as a government-sponsored Ponzi scheme that victimized the younger generation who were required to pay into the system and received nothing in return. When the Social Security Act of 1935 was enacted as a social insurance program under the administration of Franklin D. Roosevelt, it was not meant to be a large monthly stipend and it was not attached to inflation. It was not until the 1950s that the amount paid was almost doubled through legislation. Until 1975 when annual cost of living increases were tied to Social Security benefits, the only increases had come through special acts by Congress. This system was implemented as the nation was changing and becoming more industrialized and as this was occurring; the family unit was becoming less interdependent on one
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