RMI 3501 Lecture Notes - Lecture 1: Political Campaign, Social Security Disability Insurance, Advantageous
22 Oct 2017
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Social security old age and survivor insurance program. Social security is an income replacement program designed to provide basic support for former workers and their dependents. The benefits, which are adjusted upward annually to track inflation, are paid monthly. This law contained several other important programs, including the basis of today"s unemployment insurance and programs to provide aid to families with dependent children. As initially written, the program covered more than 30 million workers but excluded large groups, including the self-employed, government workers, and agricultural and domestic employees. Social security replaces a far higher proportion of low-income retirees" previous salaries than it does of high-income retirees" salaries. Congress increased benefits from time to time to maintain their purchasing power. Basing this adjustment on prices rather than wages guaranteed that recipients" purchasing power would remain constant even if wages rose more slowly than prices. Reduced benefits continue to be available at age 62.
