2. By: Alyssa Fingerman and Lauren Huston SOCIAL SECURITY

3. Background You should have read your textbook silly! You really think I’m going to type it out for you?

4. Just Kidding Background: During the Great Depression (FDR and New Deal): Needed some type of welfare program to help people, but questions of constitutionality and whether it would crush individualistic spirit of America remained Despite these qualms, TADA!... The Social Security Act of 1935 oInsurance program - for unemployed and elderly (pay contributions while working) oAssistance program – for blind, dependent children and aged oAdministered by states, funded by federal government

5. AND NOW FOR THE GARBAGE CAN!

6. Problems By 2014 current tax revenues will be insufficient to pay current benefits By 2029 the social security trust fund will be exhausted Because: Life expectancy is increasing faster than expected. The fertility rate is decreasing faster than expected (it is already less than the rate of 2.1 needed just to replace the existing population). The elderly portion of the population is expected to rise from 12 percent today to 20 percent by 2050. The smaller working age population and larger elderly population means that where there were more than five workers for each retiree in 1960 and 3.3 workers per retiree today by 2030 there will be just two workers to pay the taxes for the benefits of each retiree.

7. Proposals Obama Administration Proposal Obama Administration Proposal “Make it easier for Americans to save for retirement and prepare for unforeseen expenses” by making adjustments to the budgets Creates a way for Americans to make retirement accounts at work enact simple rules and “automatic enrollment that experts estimate will increase savings participation to 80% for low- and middle-income workers” Council on Foreign Relations Council on Foreign Relations Raise payroll taxes; raise other taxes and earmark the revenues for Social Security; lower benefits; raise the retirement age; privatize part of the system and let individuals invest in stocks, bonds, and mutual funds in order to attain higher rates of return on their payroll taxes. Ex-President Bush Ex-President Bush Partially privatize social security by allowing workers to invest in Personal Retirement Accounts

8. Proposals (continued) AARP- System isn’t broken Proposes: “Raise the cap on the amount of wages taxed to support Social Security”– therefore it would equal the same amount of wages as in the past. “That would gradually raise today's cap of $106,800 to approximately $213,000.” Also include all newly hired state and local government workers in Social Security to make it truly universal. Alliance for Retired Americans Proposes: Raising or eliminating the cap on taxable earnings. Dedicating estate tax revenues above a certain limit to the Social Security trust funds.

9. Obama’s Budget United States Federal Budget for Fiscal Year 2010: A New Era of Responsibility: Renewing America's Promise “Provides $11.6 billion for the Social Security Administration,” a 10% increase from last year Budget was passed Supposed to : “Provides funding for increasing program integrity efforts to ensure payments are made to the right person and in the correct amount” “ Modernizes rules for evaluating disability” “Providing the American public with better service” A Step Toward Accomplishing Obama’s Objective: continue to spend money in the hope that eventually something will happen (hey, it worked for FDR) Motto: “If we fund it, it will happen” ~Field of Dreams Hope

10. Politics: Parties The scary monster in every politician’s closet is Social Security. It is ‘political poison’ because the career of anyone who has tried to change it has gone down the drain. Both sides seem to believe that Social Security is one of the those necessary evils we have to live with. Both parties are for it (it would be a death sentence not to be). In order for them to facilitate change they need the wholehearted support of their constituents.

11. Politics: Interest Groups AARP AARP – This powerful interest group’s support is necessary for anything new concerning social security. Any cut in benefits would probably bring howls of outrage while any increase in benefits would be greeted with smiles. In order to maintain their support, any changes would have to maintain benefits in some way, or we could simply push full speed ahead with out their support – but chances are that would be extremely difficult.

12. Politics: Interest Groups (continued) Alliance for Retired Americans Alliance for Retired Americans Believe social security is VERY important, but reform is necessary. While not as prominent as the AARP, their support is necessary to pass anything that could affect the people they are representing – elderly Americans

13. Politics: Public opinion According to a recent Gallup poll, “Americans are increasingly concerned about retirement income.” In order to change Social Security the government will NEED the support of the masses as this effects all Americans. Americans do not want a decrease in benefits but many are wary of the deficit and many fear the benefits will not be available to them by the time they retire.

14. Politics: Public Opinion (Continued) Once the Baby Boomers retire, there will simply not be enough workers supplying social security taxes to pay for the retirees Social Security. Many non-retirees fear this program will vanish by the time they retire and they will not receive the benefits they paid for. If politicians were able to capitalize effectively on this fear they might be able to make changes to the decrepit system but this is highly unlikely.

15. THE END!

16. Sources www.whitehouse.gov www.ssa.gov http://www.gallup.com/poll/117703/Americans-Increasingly- Concerned-Retirement-Income.aspx http://www.gallup.com/poll/117703/Americans-Increasingly- Concerned-Retirement-Income.aspx http://www.whitehouse.gov/omb/ http://www.democrats.org/a/national/american_dream/secure _retirement/ http://www.democrats.org/a/national/american_dream/secure _retirement/ http://www.cfr.org/publication/7579/social_security_reform.h tml http://www.cfr.org/publication/7579/social_security_reform.h tml http://www.heritage.org/Press/Commentary/ed051205a.cfm http://www.whitehouse.gov/omb/assets/fy2010_new_era/Soci al_Security_Administration1.pdf http://www.whitehouse.gov/omb/assets/fy2010_new_era/Soci al_Security_Administration1.pdf http://gop.com/

17. Sources (continued) http://www.ncpa.org/sub/dpd/index.php?Article_ID=17 582 http://www.ncpa.org/sub/dpd/index.php?Article_ID=17 582 http://www.aarp.org/money/social_security/articles/finan cing_of_Social_Security.html http://www.aarp.org/money/social_security/articles/finan cing_of_Social_Security.html http://www.aarp.org/money/social_security/articles/keep ing_Social_Security_strong.html http://www.aarp.org/money/social_security/articles/keep ing_Social_Security_strong.html http://www.retiredamericans.org/ht/a/GetDocumentActi on/i/2804 http://www.retiredamericans.org/ht/a/GetDocumentActi on/i/2804