Since 1935 Social Security has been the foundation of economic security for America’s workers, retirees and their families. This fundamental program provides benefits for million of people, including retirees, disabled workers and the families of deceased workers. Social Security is a financially sound program, with a current surplus of billions a year. Moreover Medicare is a social insurance program that has provided guaranteed health insurance to millions of older and disabled Americans since it was established in 1965. The social Security started as an anti-poverty program created to alleviate the impact of the Great Depression during the 1930s. President Franklin D. Roosevelt declared to the Congress his intentions to create a program for Social Security on June 8, 1934. The Social Security Act was signed on August 14, 1935, it was a social insurance intended to pay retired workers age 65 an older an ongoing income after retirement. The program began paying pension benefits in 1937. More than 35 million Social Security Cards were issued during 1936 and 1937 (2Facts 2-3).

In 1939 two new categories were added to the Social Security. Since the original act only c

Since the creation of these two programs Medicare and Medicaid have provided more than 93 million elderly and disabled Americans. Today Medicare serves 37 million elderly and grows at a rate of 9.9% annually. Medicaid has provided health care to more than 36 million poor people, elderly and disabled one in every 10 Americans.

overed retirement benefits to workers; the 1939 Amendments benefit with payments to the spouse and minor children of the retired worker called the dependents benefits and in the case of premature death of the worker the survivor benefits were paid to the family. There were no changes in Social Security until 1950. Benefits were very low so that during that year major amendments were created in order to raised the benefits and make this program on the way to the extended coverage that has today. Moreover, is hard to look at Social Security without looking at the annual increases in benefits called Cost-of-Living Adjustments (COLAs) to balance the effects of inflation on fixed incomes that the Congress legislated in 1950 to a 77% when ever they considered necessary. But in 1972 the law changed to an automatic COLAs increase based in changes on the annual consumer prices (ssa 4).

Social Security had faced many financial problems since its creation. To comprehend the problems of this system is important to know that Social Security is a “pay-as-you-go” program that works fine if there are enough workers to maintain the program going because Social Security is financed by the payroll taxes deducted from workers in order to paid remunerations to retirees. The most serious problem is the aging of about 76 million people called “baby boomers” born between 1946 and 1964 and the lowest level of birthrate ev

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