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Essay The Social Security Blanket: Full of Holes?

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The Social Security Act was enacted in 1935, and since then it has undergone numerous revisions and amendments. Today the act covers a wide range of benefit programs, including Medicare, unemployment compensation, and Supplemental Security Income. The major portion for which the Social Security Act has become known, however, is the Old Age, Survivors, and Disability Insurance program, or OASDI. While today the OASDI program is most frequently referred to as “Social Security,” it is only a thread in what has been called the “social safety net.” Therefore, throughout this paper, it should be understood that Social Security will be the term used to refer to all its encompassed programs as a group, as a matter of convenience. Recent budget …show more content…

Obviously, this is an enormous allocation of resources, and as such, it would be irresponsible to deny that it has a far-reaching impact on the economy. Furthermore, these expenditures are, unless counteracted, likely to continue to grow as they have since Social Security's first inception. The championed cause of social responsibility is embodied in the Social Security program; at its core, Social Security's mission is to provide assistance to the elderly and less-privileged in society. Although it may have been a sound approach for its time – during the depths of the Great Depression, when many were poor and unemployed and the economy may truly have benefited from the increased spending – it has since become a bloated budgetary item. Many of its difficulties could be said to stem from its “pay-as-you-go” funding plan. Social Security withholdings are not put away for the future needs of the person from whom they are withheld, but are instead transferred to an existing claimant. The pay-as-you-go system means that current recipients are paid for out of current revenues. In good years, these revenues have outnumbered the claims laid to them, but it is clear that that period is coming to an end. The Baby Boomers – a massive population segment who, in their youth, contributed greatly to Social Security revenues – are now coming into their own as retirees, and will no longer provide the revenue that they did in their working years.

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