Financial History Issue 114 (Summer 2015) | Page 38

© Bettmann/CORBIS

BENEFITS OF
HINDSIGHT
A Brief
Look Back at
80 Years of
Social Security

Clerks in the US Census Bureau office catalog
the names of more than 75 million Americans
potentially eligible for Social Security benefits,
November 10, 1935.

By Kristin Aguilera
This year marks the 80th anniversary of
Social Security, as President Franklin D.
Roosevelt signed the Social Security Act
into law on August 14, 1935. But while
this legislation was known as the “crown
jewel” of FDR’s New Deal program, it
was actually his distant cousin, Theodore
Roosevelt, who introduced America to the
notion of social insurance.
In Theodore Roosevelt’s 1912 address to
the convention of the Progressive Party,
he stated, “We pledge ourselves to work
unceasingly in state and nation for…the
protection of home life against the hazards
of sickness, irregular employment, and old
age through the adoption of a system of
social insurance…”
The idea of social insurance was not
Theodore or Franklin Roosevelt’s, however, nor was it an American invention
at all. First adopted in Germany in 1889,
it was already operating in 34 countries

36    FINANCIAL HISTORY  |  Summer 2015  | www.MoAF.org

by the time the US implemented such a
system.
In the years between Theodore Roosevelt’s speech in 1912 and the signing of
the Social Security Act in 1935, many disparate ideas were proposed for ensuring
the economic security of the American
people as the Great Depression took hold.
Some of the more famous proponents of
these plans were California doctor Francis
E. Townsend (who advocated for federal government pensions), Senator Huey
Long (who wanted the government to
confiscate and redistribute money from
the wealthy) and novelist Upton Sinclair (whose 12-point plan for California
included the issuance of script currency,
a barter system and a state pension plan).
One of the major problems FDR saw in
these and other radical calls to action was
the undermining of the American capitalist
system. Thus, when he introduced his Social
Security program at the height of the Depression, many saw this action as an innovative,