August
28, 1950
Soical
Security for the Self-Employed
U.S. President Truman signed
into law a bill that made 10,000,000 people (self-employed businesspersons,
domestic servants and farm workers) eligible for Social Security retirement. A
gradual increase federal payroll tax (at the time 1.5%) would go into effect in
1951 and be tripled by the year 1970. The average monthly benefit ($26) was
increased to $46 effective October 1. Old-age coverage was extended and made
optional for state and city government employees, including those of publicly
owned transit systems, as well as employees of non-profit organizations.
The
Social Security Act was enacted August 14,
1935. The Act was drafted during President Franklin D. Roosevelt's first term
by the President's Committee on Economic Security, under Frances
Perkins, and passed by Congress as part of the New Deal.
The Act was an attempt to limit what were seen as dangers in the modern
American life, including old age, poverty, unemployment, and the burdens of
widows and fatherless children.
The
Act provided benefits to retirees and the unemployed, and a lump-sum
benefit at death. Payments to current retirees are financed by a payroll
tax on current workers' wages, half directly as a payroll tax and half paid
by the employer. The act also gave money to states to provide assistance to
aged individuals (Title I), for unemployment insurance (Title III), Aid to Families with Dependent
Children (Title IV), Maternal and Child Welfare (Title V), public health
services (Title VI), and the blind (Title X).
Born in 1950?
Then
congratulations on entering the world of Medicare. Like to know more …
