Medicare and the Economy

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Medicare and the Economy

In order to fully understand Medicare, we first have to look at how the whole Government program started. To do this, we will first look at Social Security.
Franklin D. Roosevelt signed the Social Security Act in August 1935. The first one-time, lump-sum payments were made in January 1937, and regular monthly benefits were first paid in January 1940. (http://www.ssa.gov)
Franklin Delano Roosevelt was quoted on August 14, 1935 to say: "This law represents a cornerstone in a structure which is being built but is by no means completed--a structure intended to lessen the force of possible future depressions, to act as a protection to future administrations of the Government against the necessity of going deeply into debt to furnish relief to the needy--a law to flatten out the peaks and valleys of deflation and of inflation--in other words, a law that will take care of human needs and at the same time provide for the United States an economic structure of vastly greater soundness." (http://www.ssa.gov)
The act created a uniquely American solution to the problem of old-age pensions. Unlike many European nations, U.S. social security "insurance" was supported from "contributions" in the form of taxes on individuals’ wages and employers’ payrolls rather than directly from Government funds. The act also provided funds to assist children, the blind, and the unemployed; to institute vocational training programs; and provide family health programs. As a result, enactment of Social Security brought into existence complex administrative challenges. The Social Security Act authorized the Social Security Board to register citizens for benefits, to administer the contributions received by the Federal Government, and to send payments to recipients. Prior to Social Security, the elderly routinely faced the prospect of poverty upon retirement. For the…...

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