Notes from the old New Deal

by Michael Smith.

I ran across some historical tidbits about Social Security on the Internet. The first person to receive benefits was Ernest Ackerman, who collected 17 cents in January 1937. Mister, we could use a man like Ernest Ackerman again…and again…and again. He might lead the way to solvency.

As it happened, the problem with solvency was foreshadowed three years later:   

“The first person to receive monthly benefits was Ida May Fuller from Vermont, who retired in November 1939 and started collecting benefits in January 1940 at age 65. In the three years that Fuller worked under the program, she contributed a total of $24.75. Her first benefit check was for $22.54 and she went on collecting benefits for 35 years, until 1975, when she died at age 100. In this time she collected a total of $22,888.92.”

Thanks a lot, Ida May—way to start a pyramid scheme! You pulled this off when the average American lived barely long enough to become eligible. Of course, you did have 16 workers behind you when the first of your 420 checks arrived, so we really can’t hold anything against you.

Our problem today is that we have about 3.3 active workers for every retiree, and the average American lives about 13 years after becoming eligible. Demographics will gradually worsen the picture: by 2030, we’ll have two workers per recipient and more people than ever will be pushing Ida May’s century mark.

Those two workers better be hellacious, don’t you think?

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