The Social Security system came into existence when the Social Security Act of 1935 was signed into law by President Roosevelt on August 14th of that year. This was the culmination of a process that had begun in June 1934 with the creation of the President's Committee on Economic Security (CES), under the leadership of Edwin Witte.
The original Social Security Act had eleven sections, or titles, that addressed various concerns. These have all changed today, with some concerns being expanded, others being reduced, and entirely new concerns being added. Nevertheless, the system implemented by the original legislation remains largely in effect today. In 1935 the primary concerns were for the elderly, the unemployed, and children.
Titles I and II were primarily concerned with the well-being of the elderly. Title I required the individual states to implement programs to care for their elderly. Once these programs were approved by the Social Security Board, the federal government would provide the states with annual grants to help finance them. Title II created the original personal benefit for the elderly, which allowed some people to receive a cash payment each month after they reached the age of sixty-five. The eligibility restrictions were rather severe in the original law, but they began easing soon thereafter.
Titles III, VIII, and IX were concerned with the unemployed. Title III required the separate states to develop aid programs for the unemployed. After these programs were approved by the Social Security Board, the state would receive a grant of federal funds to help defray the expense of the program. Title VIII implemented an additional income tax to help pay for the Social Security program. Title IX created the Unemployment Trust Fund to help pay for unemployment benefits and imposed an additional excise tax on employers to help fund it.
Titles IV and V dealt with relief for children without adequate provision. These titles followed the general pattern as illustrated in Titles I and III above. Specifically, they required the individual states to develop programs for helping dependent children that lacked providers and programs to help improve the health of mothers and children. Once the plans were developed they were submitted to the Social Security Board. If the Board approved the plan, the state would then receive annual grants from the federal government to help finance them.
As this series continues, we will look at how these original provisions were put into practice as well as the titles not discussed here. Implementing the Social Security system was a complex affair, beset by many problems, but one that ultimately worked better than anyone expected.