Every January, headlines announce “new laws” taking effect at the start of the year. Here’s one from nearly ninety years ago: 

 “Effective January 1, 1937, we are compelled by a Roosevelt ‘New Deal’ law to make a 1% deduction from your wages and turn it over to the Government…You might get this money back in future years… but only if Congress decides to make the appropriation for that purpose. There is NO guarantee.”            

             This and similar notices were actually issued by Republicans and anti-New Deal employers in November 1936, just before the presidential election between Roosevelt and Landon. New Dealers accused Republicans of trying to “intimidate labor,” and the Social Security Administration condemned the notices as “nearly all misleading.”  Roosevelt went on to win the election in a landslide, garnering 61% of the popular vote and carrying every state except for Maine and Vermont.  

Despite the ominous tone reflected above Social Security did pay benefits to workers who paid the tax. From 1937 to 1940, retirees received one-time lump sum payments. The first monthly retirement check was issued to Miss Ida May Fuller of Ludlow, Vermont, on January 31, 1940. Having paid a total of $24.75 in taxes over three years, her first check was for $22.54. Miss Fuller lived to be 100 years old and collected a total of $22,888.92 in benefits before her death in 1975. In 2024, Social Security expenditures were $1.5 trillion and accounted for 22% of Federal Government spending. 

Yet the warning contained a kernel of truth: Social Security benefits are entirely at Congress’s discretion. In Helvering v. Davis (1937), the Supreme Court stated, “The proceeds of both the employee and employer taxes are to be paid into the Treasury like any other internal revenue generally, and are not earmarked in any way,” implying Congress can spend the money in any manner they choose. This was reaffirmed in Fleming vs. Nestor (1960). The court held that Social Security benefits are not a contractual right but rather a non-contractual government benefit that Congress may modify at any time. 

Despite the pleas of many, Social Security benefits are a political promise, not a legal guarantee. Current projections warn that the Social Security system will become insolvent sometime in 2032.  

Nearly ninety years later, the debate endures: Social Security was never a promise etched in law, only a policy shaped by politics. If you’re betting your future on Social Security, you’re betting on Congress.