Question

Why was the Social Security Act established?​

Answer 1

The Social Security Act was established in 1935 as part of the New Deal to provide financial security to the elderly, unemployed, disabled, and impoverished families, funded through employer and employee taxes.

Step-by-step explanation:

The Social Security Act (SSA) was established in 1935 as part of President Franklin D. Roosevelt’s New Deal during the Great Depression. As the economic crisis left many older Americans in dire straits, the SSA aimed to provide financial security to this vulnerable population. Additionally, the act was designed to support other groups, such as unemployed workers, people with disabilities, and impoverished children.

The program’s main components included old-age pensions for retired workers and their dependents, which were to be collected monthly upon reaching the age of 65, unemployment insurance, financial compensation for injured workers, and direct financial aid for families in need. It was primarily funded through taxes payable by both employers and employees to maintain a degree of self-sustainability for the system.

Despite its comprehensive scope, certain groups, including agricultural and domestic workers, were initially excluded from coverage, impacting a significant portion of the minority population. Over time, however, amendments have been made to expand coverage and address the needs of those initially left out.

Answer 2

On July 30, 1965, President Lyndon B. Johnson signed the Medicare and Medicaid Act, also known as the Social Security Amendments of 1965, into law. It established Medicare, a health insurance program for the elderly, and Medicaid, a health insurance program for people with limited income.