Social Security (United States)

Social Security Poster: old man (Photo credit: Wikipedia)

In the United States, Social Security refers to the Old-Age, Survivors, and Disability Insurance (OASDI) federal program. The original Social Security Act (1935) and the current version of the Act, as amended[3] encompass several social welfare and social insurance programs.

Social Security is primarily funded through dedicated payroll taxes called Federal Insurance Contributions Act tax (FICA). Tax deposits are formally entrusted to the Federal Old-Age and Survivors Insurance Trust Fund, the Federal Disability Insurance Trust Fund, the Federal Hospital Insurance Trust Fund, or the Federal Supplementary Medical Insurance Trust Fund which comprise the Social Security Trust Fund.

By dollars paid, the U.S. Social Security program is the largest government program in the world and the single greatest expenditure in the federal budget, with 20.8% for Social Security, compared to 20.5% for discretionary defense and 20.1% for Medicare/Medicaid. According to economist Martin Feldstein, the combined spending for all social insurance programs in 2003 constituted 37% of government expenditure and 7% of the gross domestic product. Social Security is currently estimated to keep roughly 40 percent of all Americans age 65 or older out of poverty.

The Social Security Administration is headquartered in Woodlawn, Maryland, just to the west of Baltimore.

Proposals to partially privatize Social Security became part of the Social Security debate during the Bill Clinton and George W. Bush presidencies.

Categories: Glossary