“Where Is the Money Coming From?”1 the Reconstruction of Social Security Finance

2012 ◽  
Author(s):  
Julian E. Zelizer
Keyword(s):  
Social Security ◽  
Tax System ◽  
Payroll Taxes ◽  
Social Security Tax ◽  
The Social ◽  
General Revenue ◽  
Fiscal Conservatism ◽  
Large Reserve

This chapter examines how Social Security finance was reconstructed in response to actions by Congress, which abolished the mandate for a large reserve and authorized the use of general revenue to pay for benefits when payroll taxes became insufficient. After describing the earmarked tax system created by Congress in 1935, the chapter considers the debate between 1939 and 1948 about the survival of the Social Security tax system and whether Social Security would be financed through the same monies as all other programs. It also looks at a cadre of policymakers, including Wilbur Mills and Robert Myers, who redesigned the earmarked tax system into the structure that defined the program until 1972. It shows that the earmarked tax system left the imprint of fiscal conservatism on Social Security by imposing certain long-term restrictions on the program.

“Where Is the Money Coming From?” The Reconstruction of Social Security Finance, 1939–1950

1997 ◽  
Vol 9 (4) ◽  
pp. 399-424 ◽  
Author(s):  
Julian Emmanuel Zelizer
Keyword(s):  
Social Security ◽  
Welfare State ◽  
American Politics ◽  
The Elderly ◽  
Tax System ◽  
Social Security Tax ◽  
The Social ◽  
Privileged Status ◽  
Working Families ◽  
As If

Social Security has achieved a privileged status in American politics. As a result of the Social Security tax, supporters claim, recipients have not received unearned benefits, nor has Congress felt as if it were building a massive welfare state. Indeed, the Social Security tax system has legitimated the program in the minds of policy experts, politicians, and recipients. Through Social Security, the American state has forged a strong alliance with the elderly and their descendants, both with retirees who received cash payments and with working families who did not have to finance their parents' retirement years.

scholarly journals Heterogeneous Scarring Effects of Full-Year Nonemployment

2017 ◽  
Vol 107 (5) ◽  
pp. 369-373 ◽  
Author(s):  
Fatih Guvenen ◽  
Fatih Karahan ◽  
Serdar Ozkan ◽  
Jae Song
Keyword(s):  
Social Security ◽  
Low Income ◽  
Social Security Administration ◽  
Earnings Distribution ◽  
Employment Effects ◽  
Long Period ◽  
Earnings Losses ◽  
The Social ◽  
Scarring Effects

Drawing on administrative data from the Social Security Administration, we find that individuals that go through a long period of non-employment suffer large and long-term earnings losses (around 35-40 percent) compared to individuals with similar age and previous earnings histories. Importantly, these differences depend on past earnings, and are largest at the bottom and top of the earnings distribution. Focusing on workers that are employed 10 years after a period of long-term non-employment, we find much smaller earnings losses (8-10 percent). Furthermore, the large earnings losses of low-income individuals are almost entirely due to employment effects.

scholarly journals Work incentives in the Social Security Disability benefit formula

2018 ◽  
Vol 18 (2) ◽  
pp. 165-189 ◽  
Author(s):  
GOPI SHAH GODA ◽  
JOHN B. SHOVEN ◽  
SITA NATARAJ SLAVOV
Keyword(s):  
Social Security ◽  
Older Workers ◽  
Extensive Margin ◽  
Disability Benefit ◽  
Payroll Tax ◽  
Payroll Taxes ◽  
The Social ◽  
Social Security Disability ◽  
Work Disincentives ◽  
Different Levels

AbstractWe examine the connection between taxes paid and benefits accrued under the Social Security Disability Insurance (SSDI) program on both the intensive and extensive margins. We perform these calculations for stylized workers given the existing benefit structure and disability hazard rates. On the intensive margin, we examine the effect of an additional dollar of earnings on the marginal payroll taxes contributed and future benefits earned. We find that the present discounted value of disability benefits received from an additional dollar of earnings, net of the SSDI payroll tax, generally declines with age, becoming negative around age 40 and reaching almost zero at age 63. On the extensive margin, we determine the effect of working an additional year on the additional payroll taxes and future benefits as a percentage of income. The return to working an additional year at an income level just large enough to earn Social Security credits for the year is large and positive through age 60. However, the return to working an additional full year is substantially smaller and becomes negative at approximately age 57. Thus, older workers face strong incentives to earn enough to obtain creditable coverage through age 60, but they face disincentives for additional earnings. In addition, workers aged 61 and older face work disincentives at any level of earnings. We repeat this analysis for stylized workers at different levels of earnings and find that, while the program transfers resources from high earners to low earners, the workers experience similar patterns in the returns to working.

Income Tax in Relation to Social Security

1946 ◽  
Vol 72 (1) ◽  
pp. 79-118 ◽  
Author(s):  
A. T. Haynes ◽  
R. J. Kirton
Keyword(s):  
Social Security ◽  
Income Tax ◽  
Combined Effect ◽  
Social Security Systems ◽  
Security Systems ◽  
Tax System ◽  
The Social ◽  
System Part ◽  
The Individual ◽  
Financial Relationship

This paper falls into three parts which form a progressive study involvingI. proposals for the reform of the Income Tax system as related to personal assessments,II. consideration of the interrelation of Income Tax and Social Security,III. proposals for the co-ordination of the Income Tax and Social Security systems.Part I of this progressive study is a plea for a business-like administration of the Income Tax system. Part II examines the combined effect upon the individual of the Income Tax system and the Social Security plan proposed by Sir William Beveridge. Part III sets out to co-ordinate Income Tax and Social Security and to simplify the financial relationship between the individual and the community.

Nicaragua protests signal dialogue, not regime change

2018 ◽  
Keyword(s):  
Law Enforcement ◽  
Social Security ◽  
Regime Change ◽  
Investment Decisions ◽  
Security Forces ◽  
Content Type ◽  
The Social ◽  
Social Security Reforms ◽  
Economic Slowdown

Significance The protests pose the greatest threat to President Daniel Ortega since he took power in 2007. The president’s eventual withdrawal of the social security reforms that had sparked the unrest has, instead of restoring order, emboldened protesters, who are now pushing for further political concessions and have called for a mass anti-government demonstration to be held tomorrow. Impacts Businesses may postpone investment decisions until after the national dialogue, posing a risk of economic slowdown. Damage to the reputation of the security forces threatens to foster long-term resentment, undermining law enforcement. The protests may spur anti-corruption protests in other parts of the region, such as Guatemala.

scholarly journals Recenzja książki Krzysztofa Brońskiego Finanse publiczne w Galicji w okresie autonomii (1867–1914). Kraków: Wydawnictwo Uniwersytetu Ekonomicznego w Krakowie, 2019, stron 319

2021 ◽  
Vol 14 (2) ◽  
pp. 271-275
Author(s):  
Mateusz Mataniak
Keyword(s):  
Public Finance ◽  
Social Security ◽  
Important Research ◽  
Tax System ◽  
Basic Principles ◽  
Financial Situation ◽  
Academic Literature ◽  
The Social ◽  
Economic Background ◽  
Statistical Studies

Review of Krzysztof Broński’s Book Public Finance of Galicia in the Autonomy Era (1867–1914). Kraków: Kraków University of Economics Press, 2019, 319 Pages The review discusses the latest book on the situation of public finances in Galicia during the period of autonomy (1867–1914). The author, using numerous statistical studies, materials of the Diet of Galicia and Lodomeria, and the National Department as well as academic literature (nineteenth-century and modern), presents Galicia’s place in the Austro-Hungarian tax system and recreates the structure of its budgets, as well as the financial situation of local government, and the basic principles of the social security system. This is all offered against a broad constitutional and political, as well as socio-economic, background. The result of the work is several important research theorems, which significantly enrich knowledge about Galicia.

scholarly journals Privatizing Social Security: Advisable But It Can Be A Roller-Coaster Ride To The U.S. Taxpayer

2014 ◽  
Vol 12 (4) ◽  
pp. 385
Author(s):  
Mahamood M. Hassan
Keyword(s):  
Social Security ◽  
Stock Market ◽  
Future Generations ◽  
Roller Coaster ◽  
Treasury Bonds ◽  
The Social ◽  
The 1960S ◽  
The One ◽  
The U.S

The ability of the Social Security retirement program to pay the promised benefits to future generations has been debated since the 1960s. Various suggestions have been made, but the one that has attracted the most passionate opinions has been whether some or all of the Social Security Trust Funds should be invested in the stock market, which would yield higher returns than on the Federal government issued bonds (Treasury Bonds). In reviewing 88 years of financial market data going back to 1926, the author shows that investing in the stock market (using the S&P 500 as the proxy) will most probably produce higher returns for the U.S. taxpayer (investor) over the long term, but the investor will have to be prepared for a roller-coaster ride of highs and lows.

scholarly journals Systematic Bias and Nontransparency in US Social Security Administration Forecasts

2015 ◽  
Vol 29 (2) ◽  
pp. 239-258 ◽  
Author(s):  
Konstantin Kashin ◽  
Gary King ◽  
Samir Soneji
Keyword(s):  
Social Security ◽  
Best Practices ◽  
Systematic Bias ◽  
Social Security Administration ◽  
Trust Funds ◽  
The Social ◽  
Forecasting Errors ◽  
Policy Proposals ◽  
Made In

We offer an evaluation of the Social Security Administration demographic and financial forecasts used to assess the long-term solvency of the Social Security Trust Funds. This same forecasting methodology is also used in evaluating policy proposals put forward by Congress to modify the Social Security program. Ours is the first evaluation to compare the SSA forecasts with observed truth; for example, we compare forecasts made in the 1980s, 1990s, and 2000s with outcomes that are now available. We find that Social Security Administration forecasting errors—as evaluated by how accurate the forecasts turned out to be—were approximately unbiased until 2000 and then became systematically biased afterward, and increasingly so over time. Also, most of the forecasting errors since 2000 are in the same direction, consistently misleading users of the forecasts to conclude that the Social Security Trust Funds are in better financial shape than turns out to be the case. Finally, the Social Security Administration's informal uncertainty intervals appear to have become increasingly inaccurate since 2000. At present, the Office of the Chief Actuary, at the Social Security Administration, does not reveal in full how its forecasts are made. Every future Trustees Report, without exception, should include a routine evaluation of all prior forecasts, and a discussion of what forecasting mistakes were made, what was learned from the mistakes, and what actions might be taken to improve forecasts going forward. And the Social Security Administration and its Office of the Chief Actuary should follow best practices in academia and many other parts of government and make their forecasting procedures public and replicable, and should calculate and report calibrated uncertainty intervals for all forecasts.

scholarly journals Sind die Probleme der Bevölkerungsalterung durch eine höhere Geburtenrate lösbar?

2004 ◽  
Vol 5 (1) ◽  
Author(s):  
Barbara Berkel ◽  
Axel Börsch-Supan ◽  
Alexander Ludwig ◽  
Joachim Winter
Keyword(s):  
Social Security ◽  
Baby Boomers ◽  
Birth Rate ◽  
Labour Force ◽  
Transitional Period ◽  
Human Capital Formation ◽  
Medium Term ◽  
Baby Boomer Generation ◽  
The Social

AbstractCan the aging problem be solved by a higher birth rate? While the popular notion - ‘‘if we have too many elderly we need more children in order to compensate for this” - seems plausible, the results of economic theory are ambiguous at best. This paper employs a quantitative macroeconomic simulation model for Germany and leads to a more subtle view, stressing the importance of human capital formation for long-term economic growth in this context. Moreover, it takes a very long transitional period until a higher fertility rate results in a larger and bettereducated labour force that contributes to social security. Therefore, reforms of the social security system still have the highest priority because this is the only way to solve the problems of an aging baby-boomer generation in the short and medium term - meaning the time until the baby boomers will retire.

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