Social Security Act
The Downside of Social Security Act
The original intent of Social Security Act of 1935 is to give protection to the retirees when old age comes. The guarantee of a pension in the later life secured the working classes of America not to fear poverty when they retire. However, the steps that the government must take in order to fulfill the visions of the law is to charge incredible amount of taxes to the same working class people.
The calculation of pension and insurance was based on the income; so in effect, the workers who receive low wages even received much lower salaries. Because of the act, the bigger chunk of their wages is spent paying for taxes as compared to upper class citizens. This is deemed unfair by the critics, saying it the act is an advantage only for the upper class workers.
The coverage of the said act is also poor. Workers in the industrial and commercial companies were the only ones covered by the Social Security Act. How about the other classes of workers such as farmers, carpenters, government employees, and the likes? For some reason only known to the authors of the law, they were excluded from the so-called old age pension benefits.
The biggest problem of the said is the absence of national standards of unemployment. Everything is up to the State to decide. With a defective system like that, problems have been quick to arise, then and until now.
The poor have stayed even poorer because of the high taxes. Only the workers with higher income and the industrial and commercial conglomerates benefit the greatest from the Social Security Act. Now here comes economic recession, and companies can declare bankruptcy in a snap, causing the so-called savings to turn into dust.
Every penny that goes back into the system, as a form of early retirement savings is not guaranteed to be restored when the time comes, given the current economic instability.