Wednesday, November 28, 2012
The idea of creating a supplemental retirement system called “social security” sounded like a good idea when president Franklin Delano Roosevelt signed the Social Security Act into law August 14, 1935. With the Great Depression a recent memory, selling security to the American people was easy. Each month, the federal government would take a small percentage of money from an employee’s paycheck. The employee’s employer would also be required to “contribute” (under duress) an equal percentage. At retirement, any person who paid into the system would get a monthly check from the Social Security Administration.
Payments of monthly benefits began in January 1940, just five years after the program was implemented. On January 31, 1940, the first monthly check was issued to a retired legal secretary, Ida May Fuller, of Ludlow, Vermont. She received a check for $22.54 (Hardy, xxiii). Fuller continued to receive benefits until she died in January 1975 at the age of 100. During her 35 years as a beneficiary, she received more than $22,000. For Fuller, Social Security turned out to be a great investment since her total “contribution” to the program was only $22.00.