According to the Republican critics at the time, the new liberal retirement program was "socialism." They said that it would a job killer, the death knell of democracy and the end of American prosperity. Republican presidential candidate Alf Landon said that it was "a cruel hoax" and "a fraud on the workingman. One GOP Representative from New York suggested that the new law was purposefully designed "to enslave workers, and to prevent any possibility of the employers providing work for the people." Another intoned ominously that "the lash of the dictator will be felt."
It all sounds oddly current and familiar. But it happened decades ago when Social Security was first proposed.
Social Security was signed into law 80 years ago by President Franklin Delano Roosevelt on August 14th, 1935. But it was Frances Perkins, the first female Secretary of Labor and cabinet member, who was the driving force behind the creation of the program.
In January of 1937, the one-time lump-sum first payment was made for a grand total of 17 cents. Regular ongoing monthly benefits began in January, 1940.
Over the years, Social Security has had to survive a great deal of opposition, including a barrage of lawsuits shortly after it was created. Republicans claimed that the law was unconstitutional. And several lawsuits eventually made their way up to the Supreme Court.
Eventually, in a 7-2 decision authored by the great Justice Benjamin Cardozo, ranked by legal scholars as among the most outstanding Supreme Court justices in our history, Social Security was found to be totally and completely constitutional.
Despite conservatives' gloomy warnings, the intervening years demonstrated they were absolutely wrong. Over the years, the retirement program known as Social Security expanded to become Old-Age, Survivors, and Disability Insurance, as it is now officially known. And it has become the most popular government program of all time.
Participants make payroll contributions based on earnings. Then benefits are paid to insured workers and eligible family members when they retire or become disabled, and to the survivors of deceased workers.
Over the decades, the program has helped to keep hundreds of millions out of the kind of grinding, hopeless poverty that was once the lot of so many seniors. In 2013, approximately 14.7 million people, including one-third of all seniors, would have lived in poverty without Social Security benefits. In addition, almost two-thirds of seniors rely on Social Security for more than half of their income.
And because women are less likely than men to have income outside of Social Security to rely on in retirement, Social Security is an especially important source of post‐retirement income, providing a life-long stream of income that is protected against inflation.
Frances Perkins would be proud if she could see Social Security today. As Secretary of Labor in the Roosevelt administration, she is the one who is generally given the credit for crafting the idea and pushing through the ground breaking new program of "social insurance" as well as the first unemployment insurance.
There are of course still critics out there, people who would like to see Social Security abolished or replaced. But we have already done a great experiment to see how things work out for people without Social Security. That experiment was called life during the 1920s and 1930s.
President Franklin Roosevelt was able to see the results first hand of that extended experiment in "smaller government." And as he remarked in his second inaugural address:
I see millions of families trying to live on incomes so meager that the pall of family disaster hangs over them day by day.
I see millions denied education, recreation, and the opportunity to better their lot and the lot of their children.
I see one-third of a nation ill-housed, ill-clad, ill-nourished.
And so Social Security was born 80 years ago and began to change all that. Happy Birthday Social Security! Thank you President Roosevelt and Frances Perkins!