Major Decisions in the House and Senate on Social Security: 1935-2000
Major Decisions in the House and Senate
on Social Security: 1935-2006
Updated October 25, 2007
Gary Sidor
Information Research Specialist
Knowledge Services Group
Major Decisions in the House and Senate on
Social Security: 1935-2006
Summary
Since its enactment in 1935, the Social Security Act has been amended
numerous times. This paper is not fully comprehensive. It briefly summarizes
discussions on individual major amendments. These summations do not characterize
the complete range of motivations behind Social Security votes; rather they record
the arguments expressed at the time and, by so doing, attempt to give the reader the
tone and context of the debate on major Social Security issues brought before the
House and Senate chambers.
This report is intended to respond to the many inquiries that CRS gets for Social
Security vote information, which range from requests for general information about
legislative action over the years to requests for information about specific floor
amendments. Thus, it is intended to be a reference document on the major statutory
decisions made by Congress on the Social Security program. A detailed table of
contents and a summary table of the legislation discussed are provided to aid the
reader. This report will be updated as additional major Social Security provisions are
considered.
Contents
In troduction ......................................................1
Chamber Votes....................................................4
A. P.L. 271 — 74th Congress, Enactment of the Social Security Act.....4
1. House Action...........................................4
2. Senate Action..........................................7
3. Conference Action......................................8
B. P.L. 379 — 76th Congress, Social Security Amendments of 1939.....9
1. House Action..........................................9
2. Senate Action.........................................12
3. Conference Action.....................................12
C. Payroll Tax Freeze, 1942-1947...............................12
D. P.L. 492 — 80th Congress, 1948 Provision for Exclusion of
Certain Newspaper and Magazine Vendors From Social Security
Coverage (H.R. 5052) and P.L. 642 — 80th Congress, 1948 Provision
to Maintain Status Quo Concept of Employee ..................14
1. House Action.........................................15
2. Senate Action.........................................16
3. Veto.................................................16
4. Veto override.........................................16
E. P.L. 734 — 81st Congress, Social Security Act Amendments of 1950.17
1. House Action.........................................17
2. Senate Action.........................................19
3. Conference Action.....................................20
F. P.L. 590 — 82nd Congress, Social Security Act Amendments of 195220
1. House Action.........................................20
2. Senate Action.........................................21
3. Conference Action.....................................21
G. P.L. 761 — 83d Congress, Social Security Amendments of 1954....22
1. House Action.........................................23
2. Senate Action.........................................23
3. Conference Action.....................................24
H. P.L. 880 — 84th Congress, Social Security Amendments of 1956....24
1. House Action.........................................25
2. Senate Action..........................................25
3. Conference Action.....................................26
I. P.L. 85-840, Social Security Amendments of 1958.................26
1. House Action.........................................26
2. Senate Action.........................................26
3. House Concurrence.....................................27
J. P.L. 86-778, Social Security Amendments of 1960................27
1. House Action.........................................28
2. Senate Action.........................................28
3. Conference Action.....................................29
K. P.L. 87-64, Social Security Amendments of 1961.................29
1. House Action.........................................30
L. Proposed Social Security Amendments of 1964..................31
1. House Action.........................................32
2. Senate Action.........................................32
3. Conference Action.....................................32
M. P.L. 89-97, Social Security Amendments of 1965................32
1. House Action.........................................33
2. Senate Action.........................................34
3. Conference Action.....................................35
N. P.L. 89-368, Tax Adjustment Act of 1966.......................36
1. House Action.........................................36
2. Senate Action.........................................36
3. Conference Action......................................36
O. P.L. 90-248, Social Security Amendments of 1967 (H.R. 12080).....37
1. House Action.........................................37
2. Senate Action.........................................37
3. Conference Action.....................................38
P. P.L. 91-172, The Tax Reform Act of 1969.......................39
1. House Action.........................................39
2. Senate Action.........................................39
3. Conference Action.....................................39
Q. P. L. 92-5, Public Debt Limit Increase; Social Security Amendments.40
1. House Action.........................................40
2. Senate Action.........................................40
3. Conference Action.....................................41
R. P.L. 92-336, Public Debt Limit; Disaster losses; Social Security
Act Amendments.........................................41
1. House Action.........................................42
2. Senate Action.........................................42
3. House Response to Senate Amendment.....................42
4. Conference Action.....................................42
S. P.L. 92-603, Social Security Amendments of 1972................43
1. House Action.........................................44
2. Senate Action.........................................44
3. Conference Action.....................................45
T. P.L. 93-233, Social Security Benefits Increase....................45
1. House Action.........................................45
2. Senate Action.........................................46
3. Conference Action.....................................47
U. P.L. 95-216. The Social Security Amendments of 1977............47
1. House Action.........................................48
2. Senate Action.........................................50
3. Conference Action.....................................52
V. P.L. 96-265, Social Security Disability Amendments of 1980.......52
1. House Action.........................................53
2. Senate Action.........................................53
3. Conference Action.....................................54
W. P.L. 96-403, Reallocation of OASl and Dl Taxes.................55
1. House Action.........................................55
2. Senate Action.........................................55
X. P.L. 96-473, Retirement Test Amendments......................56
3. House Concurrence.....................................57
4. Senate Concurrence....................................58
Y. P.L. 97-35, The Omnibus Budget Reconciliation Act of 1981.......58
1. Senate Action.........................................58
2. House Action.........................................59
3. Conference Action.....................................60
Z. P.L. 97-123, The Social Security Amendments of 1981............60
I. House Action..........................................61
2. Senate Action.........................................61
3. Conference Action.....................................62
AA. P.L. 97-455, An Act Relating to Taxes on Virgin Island Source
Income and Social Security Disability Benefits..................63
1. Senate Action.........................................63
2. House Action.........................................64
3. Conference Action.....................................64
BB. P.L. 98-21, The Social Security Amendments of 1983............64
1. House Action.........................................65
2. Senate Action.........................................66
3. Conference Action.....................................67
CC. P.L. 98-460, Social Security Disability Benefits Reform Act of 198467
1. House Action.........................................68
2. Administrative Action...................................69
3. Senate Action.........................................69
4. Conference Action.....................................70
DD. P.L. 99-177, Public Debt Limit — Balanced Budget and
Emergency Deficit Control Act of 1985.......................70
1. House Action.........................................71
2. Senate Action.........................................71
3. Conference Action.....................................71
EE. S.Con.Res. 32, Proposed COLA Constraints in FY1986
Budget Resolution........................................71
1. Senate Action.........................................72
2. House Action.........................................72
3. Conference Action.....................................73
FF. P.L. 99-509, The Omnibus Budget Reconciliation Act of 1986.....73
1. Senate Action.........................................73
2. House Action.........................................74
3. Conference Action.....................................74
GG. P.L. 100-203, The Omnibus Budget Reconciliation Act of 1987....74
1. House Action..........................................74
2. Senate Action.........................................74
3. Conference Action......................................75
HH. P.L. 100-647, The Technical and Miscellaneous Revenue
Act of 1988.............................................75
1. House Action..........................................75
2. Senate Action.........................................75
3. Conference Action.....................................76
II. P.L. 101-239, The Omnibus Budget Reconciliation Act of 1989.....76
1. House Action.........................................76
2. Senate Action.........................................76
1. House Action.........................................77
2. Senate Action.........................................78
3. Conference Action.....................................79
KK. P.L. 103-66, The Omnibus Budget Reconciliation Act of 1993.....79
1. House Action.........................................80
2. Senate Action.........................................80
3. Conference Action.....................................80
4. House Action.........................................81
5. Senate Action.........................................81
6. Conference Action.....................................81
LL. P.L. 103-296, The Social Security Administrative Reform
Act of 1994.............................................82
1. House Action.........................................83
2. Senate Action.........................................83
3. Conference Action.....................................83
MM. P.L. 103-387, The Social Security Domestic Reform Act of 1994..83
1. House Action.........................................84
2. Senate Action.........................................84
3. Conference Action.....................................84
NN. P.L. 104-121, The Senior Citizens Right to Work Act of 1996.....84
1. House Action.........................................85
2. Senate Action.........................................85
OO. P.L. 106-170, The Ticket to Work and Work Incentives Improvement
Act of 1999.............................................85
1. House Action.........................................86
2. Senate Action.........................................86
3. Conference Action.....................................86
PP. P.L. 106-182, The Senior Citizens Right to Work Act............86
1. House Action.........................................87
2. Senate Action.........................................87
3. Conference Action.....................................87
QQ. P.L. 108-203, The Social Security Protection Act of 2004.........88
1. House Action.........................................90
2. Senate Action.........................................90
3. House Response to Senate Action..........................90
List of Tables
Table 1. Social Security Laws, 1935-2006..............................2
Major Decisions in the House and Senate
on Social Security: 1935-2006
Introduction1
The Social Security Act of 1935 established a federal old-age pension financed
with employee-employer payroll taxes for most workers in commerce and industry.
Congress since then has changed the Social Security program many times.
Amendments to the original Act have: added survivors’ and dependents’
benefits; added disability, hospital, and medical insurance; expanded coverage to new
groups of workers; lowered the minimum age for retirement benefits; increased
payroll taxes; raised benefits; provided for automatic adjustment of benefits to reflect
inflation; and made numerous other changes. This paper reviews the major votes
taken by the House and Senate in passing the original Act and in amending it from
1936 through 2006. Discussion centers on Old-Age, Survivors and Disability
Insurance (OASDI) votes, although Medicare and other programs are brought up
occasionally. The discussion of the votes is set forth in terms of House action,
Senate action, and conference agreements and it gives the party breakdown for most
votes discussed (D = Democrat, R=Republican, I = Independent). The paper looks
not only at votes on final passage of bills and adoption of conference reports, but also
at votes on amendments considered on the floor of the House and Senate and at votes
for recommittal to committee just before passage. It generally does not examine
votes that occurred at the committee level. The primary source of the vote
information was the Congressional Record. The primary source of the information
for the separation of the vote by political party was the Congressional Quarterly.
From the start the old-age benefits program aroused argument. Opponents said
that the payroll or Social Security tax was likely to overburden industry, reduce the
purchasing power of workers, and endanger the growth of private pension plans. In
addition, some argued that huge reserves to be built up in the old-age reserve account
would become a tempting source of funds that the government could borrow for
current spending and, thus, would lead to an increase in the federal debt. Fear that
the reserve account would be used to subsidize “New Deal” projects was one reason
why some Members argued for current financing (pay-as-you-go) of old-age benefits.
Some opponents maintained that the federal government did not have the
constitutional power to create a national pension plan. Some questioned whether the
system could be kept financially sound and whether adequate earnings records could
be maintained for so many millions of workers. Still others said that the program
1 This report was originally written by Geoffrey Kollmann and Carmen Solomon-Fears. The
listed author updated the report and can respond to inquiries on the subject.
was not generous enough. They protested that it gave only partial protection and
minimal benefits and that it imposed a regressive, “soak-the-poor” tax.
Proponents maintained that Social Security would provide protection against
destitution and dependency in old age and that it would provide persons with an
opportunity to care for themselves on a more adequate basis than could be obtained
from state old-age assistance payments (welfare). Some regarded the proposal’s self-
financing method — payroll taxes on employers and employees — as a strength. As
workers would be required to pay taxes on their wages in order to receive Social
Security, they would acquire an earned right to benefits, and no income test would
apply. Further, some said that because the system would be financed by earmarked
payroll taxes, it would be relatively free from political and economic pressures that
might impair its financial soundness and capacity to do the job intended.
Table 1. Social Security Laws, 1935-2006
Year TitlePublic LawBill Number
1935Social Security ActP.L. 74-271*H.R. 7260
1939Social Security Amendments of 1939P.L. 76-379*H.R. 6635
1942Revenue Act of 1942P.L. 77-753*H.R. 7378
1943Joint Resolution Regarding Tariff ActP.L. 78-211*H.J.Res. 171
1943Revenue Act of 1943P.L. 78-235*H.R. 3687
1944Federal Insurance Contributions Act of 1945P.L. 78-495*H.R. 5564
1945Revenue Act of 1945P.L. 79-214*H.R. 4309
1946Social Security Amendments of 1946P.L. 79-719*H.R. 7037
1947Social Security Amendments of 1947P.L. 80-379*H.R. 3818
1948Exclusion of Certain Newspaper and Magazine VendorsP.L. 80-492*H.R. 5052
from Social Security Coverage
1948Maintain Status Quo Concept of EmployeeP.L. 80-642*H.J. Res 296
1950Social Security Act Amendments of 1950P.L. 81-734*H.R. 6000
1952Social Security Act Amendments of 1952P.L. 82-590*H.R. 7800
1954Social Security Amendments of 1954P.L. 83-761*H.R. 9366
1956Social Security Amendments of 1956P.L. 84-880*H.R. 7225
1958Social Security Amendments of 1958P.L. 85-840H.R. 13549
1960Social Security Amendments of 1960P.L. 86-778H.R. 12580
1961Social Security Amendments of 1961P.L. 87-64H.R. 6027
1964Proposed Social Security Amendments of 1964—— — H.R. 11865
1965Social Security Amendments of 1965P.L. 89-97H.R. 6675
1966Tax Adjustment Act of 1966P.L. 89-368H.R. 12752
1967Social Security Amendments of 1967P.L. 90-248H.R. 12080
1969Tax Reform Act of 1969P.L. 91-172H.R. 13270
1971Public Debt Limit, Increase; Social Security Act, P.L. 92-5H.R. 4690
Amendments
1972Public Debt Limit; Disaster Losses; Social Security Act,P.L. 92-336H.R. 15390
Amendments
Year TitlePublic LawBill Number
1973Social Security Benefits, IncreaseP.L. 93-233H.R. 11333
1977Social Security Amendments of 1977P.L. 95-216H.R. 9346
1980Social Security Disability Amendments of 1980P.L. 96-265H.R. 3236
1980Reallocation of OASl and Dl TaxesP.L. 96-403H.R. 7670
1980Earnings Test AmendmentsP.L. 96-473H.R. 5295
1981Omnibus Budget Reconciliation Act of 1981P.L. 97-35H.R. 3982
1981Social Security Amendments of 1981P.L. 97-123H.R. 4331
1983An Act Relating to Taxes on Virgin Islands Source IncomeP.L. 97-455H.R. 7093
and Social Security Disability Benefits
1983Social Security Amendments of 1983P.L. 98-21H.R. 1900
1984Social Security Disability Benefits Reform Act of 1984P.L. 98-460H.R. 3755
1985Public Debt Limit — Balanced Budget and Emergency P.L. 99-177H.J. Res 372
Deficit Control Act of 1985
1985COLA Constraints in FY86 Budget Resolution —— — S.Con.Res. 32
1986Omnibus Budget Reconciliation Act of 1986P.L. 99-509H.R. 5300
1987Budget Reconciliation Act of 1987P.L. 100-203H.R. 3545
1988Technical and Miscellaneous Act of 1988P.L. 100-647H.R. 4333
1989Omnibus Budget Reconciliation Act of 1989P.L. 101-239H.R. 3299
1990Omnibus Budget Reconciliation Act of 1990P.L. 101-508H.R. 5835
1993Omnibus Budget Reconciliation Act of 1993P.L. 103-66H.R. 2264
1994Social Security Administrative Reform Act of 1994P.L. 103-296H.R. 4277
1994Social Security Domestic Reform Act of 1994P.L. 103-387H.R. 4278
1996Senior Citizens Right to Work Act of 1996P.L. 104-121H.R. 3136
1999Ticket to Work and Work Incentives Improvement Act ofP.L. 106-170H.R. 1180
1999
2000Senior Citizens Freedom to Work Act P.L. 106-182H.R. 5
2004Social Security Protection Act of 2004P.L. 108-203H.R. 743
* The printed law does not show the ordinal number of the Congress that passed it. The number is given here for
reference purposes.
Chamber Votes
A. P.L. 271 — 74th Congress, Enactment of the Social
Security Act
The Social Security Act became law on August 14, 1935, when President
Roosevelt signed H.R. 7260. Title II of the act created a compulsory national old-age
benefits program, covering nearly all workers in commerce and industry and
providing monthly pensions at age 65 for insured workers. A benefit weighted
toward lower-paid workers was to be based on cumulative wages and was to be
payable beginning in 1942 to persons aged 65 and over who had paid Social Security
taxes for at least five years. The benefit was to be withheld from an otherwise
qualified person in any month in which he or she did any work. Under Title VIII of
the act, a payroll tax of 1%, each, on employees and employers, payable on earnings
up to $3,000 each year, was to be imposed as of January 1, 1937, on covered jobs,
and was scheduled to rise in steps to 3% by 1949.
Besides old-age benefits, the act provided for a system of federal-state
unemployment compensation funded with employer payroll taxes, and for grants to
states to help fund assistance payments to certain categories of needy persons (the
aged, the blind, and children under 16 who had been deprived of parental support),
child welfare services, and maternal and child health services.
When the act was debated in Congress, prominent Republicans in the House and
Senate made attempts to delete the provisions creating the old-age pension system.
They said they preferred to rely solely on the assistance (charity/welfare) approach
to help the aged. They argued that the payroll tax/insurance mechanism of the old-
age benefits provisions might be unconstitutional and that it would impose a heavy
tax burden on businesses that would retard economic development. Members of the
minority stated, in the Ways and Means Committee’s report to the House, that the
old-age benefits program (Title II) and the method by which the money was to be
raised to pay for the program (Title VIII) established a “bureaucracy in the field of
insurance in competition with private business.” They contended further that the
program would “destroy old-age retirement systems set up by private industries,
which in most instances provide more liberal benefits than are contemplated under
Title II.”2 Although some party members tried to remove the old-age benefits
provisions, the majority of Republicans in both chambers nevertheless did vote for
the final Social Security bill. During congressional debate, Democrats generally
supported the proposed old-age benefits program.
1. House Action. Debate on the Social Security bill started in the House on
April 11 and lasted until April 19, 1935. Approximately 50 amendments were
offered, but none passed. According to Edwin Witte, a key player in the
2 U.S. Congress. House. Committee on Ways and Means. The Social Security Bill. Report
to Accompany H.R. 7260. Report No.615, 74th Cong., 1st Sess. Washington, GPO, 1935.
p. 44.
development of the Social Security Act, House leaders passed the word that they
wanted all amendments defeated.3
Four particularly significant votes were: Mr. Monaghan’s amendment
proposing a revised “Townsend plan” and Mr. Connery’s amendment proposing the
Lundeen plan, both of which (described below) called for a more generous social
insurance system; Mr. Treadway’s motion to recommit H.R. 7260 to delete the old-
age benefits program and its related taxes; and the vote on final passage of the bill.
a.On April 18, 1935, Mr. Monaghan (D-MT) offered an amendment, introduced
in its original form by Mr. Groarty (D-CA) and referred to as the Townsend
plan, which required the federal government to pay a $200-a-month pension to
everyone 60 years of age and older, to be financed by a 2% tax on “all financial”
transactions (essentially a sales tax). (For more details on the Townsend plan
see discussion of the 1939 amendments, beginning on page 9.) Mr. Monaghan’s
amendment, although less costly than the original Townsend plan, was rejected
by a vote of 56 to 206.4
b.On April 18, 1935, Mr. Connery (D-MA) offered an amendment that contained
the provisions of a bill sponsored by Mr. Lundeen (Farmer-Laborite-MN). The
Lundeen bill, which was approved 7-6 by the House Labor Committee, called
for the “establishment of a system of social insurance to compensate all workers
and farmers, 18 years of age and over, in all industries, occupations, and
professions, who are unemployed through no fault of their own ...”5 Mr.
Lundeen’s plan offered higher benefits than the Committee’s bill, and tied
benefits to the cost of living. Under the Lundeen proposal, a more generous
social insurance program was to be extended to all workers and farmers unable
to work because of illness, old age, maternity, industrial injury, or any other
disability. This system was to be financed by taxes falling most heavily on
persons with higher incomes (by levying additional taxation on inheritances,
gifts, and individual and corporation incomes of $5,000 a year and over). There
was a division vote of 52 in favor and 204 opposed. Mr. Connery asked for
tellers. The Connery amendment was rejected by a 40-158 teller vote.6
3 Witte, Edwin E. The Development of the Social Security Act. University of Wisconsin
Press, 1963. p. 98. (Hereafter cited as Witte, The Development of the Social Security Act.)
4 Congressional Record. April 18, 1935. House. p. 5958. The vote on the Townsend plan
amendment was not taken by roll call, but by division. A division vote is taken as follows:
Members in favor of a proposal stand and are counted by a presiding officer; then Members
opposed stand and are counted. There is no record of how individual Members voted. The
Members voting for the Townsend plan, however, were listed in newspapers. The majority
of Members who voted for the Townsend plan were conservative Republicans who opposed
the entire Social Security bill. Witte, The Development of the Social Security Act, p. 99.
5 Congressional Record. April 18, 1935. House. In floor remarks by Mr. Lundeen. p.
6 Congressional Record. April 18, 1935. House. p. 5969. In the House, Members would
file past tellers and be counted as for or against a measure, but they were not recorded by
name. The teller vote has not been used in the House in many years and was never used in
the Senate.
c.On April 18, 1935, Mr. Treadway (R-MA), the ranking minority member of the
Ways and Means Committee, offered an amendment to strike Title II, the old-
age benefit provisions, from the bill. Mr. Treadway was opposed to the old-age
benefits provision and to the taxing provisions of Title VIII. He said that the
financing arrangement was unconstitutional. He indicated that the tax would
be particularly burdensome on industry, running up to 6% on payrolls. He said
that “business and industry are already operating under very heavy burdens” and
maintained that to add a payroll tax to their burden would probably cause more
unemployment and more uncertainty.7 Mr. Jenkins (R-OH), supporter of the
Treadway amendment, stated that making each worker pay 3% of his money for
old-age benefits, whether he wanted to or not, and requiring employers to do the
same, was clearly unconstitutional. He said, “Why talk about wanting to relieve
the Depression, why talk about charity, why talk about all these other things
when you are placing a financial lash upon the backs of the people whose backs
are breaking under a load of debts and taxes?” He described the old-age
benefits system as “compulsion of the rankest kind.”8 The Treadway
amendment was defeated by a 49-125 teller vote.9
d.On April 19, 1935, Mr. Treadway made a motion to recommit H.R. 7260,
including instructions to the Ways and Means Committee to strike out the old-
age and unemployment insurance provisions and to increase the federal
contribution for the welfare program of old-age assistance, Title I of the bill.10
Mr. Treadway stated that the old-age benefit and unemployment insurance
provisions of the bill were not emergency measures and that they “would not
become effective in time to help present economic conditions, but, on the
contrary would be a definite drag on recovery.” He was opposed to levying a
tax against both the employer and the employee. During his remarks on April
12, 1935, Mr. Treadway stated that he would “vote most strenuously in
opposition to the bill at each and every opportunity.”11 During his April 19,
1935, remarks, Mr. Treadway said he was disgusted “at the attitude of business
in that it has not shown the proper interest in protecting itself by stating its case
before Congress.”12 His motion to recommit was rejected by a vote of 149 (95-
R, 45-D, 9-1) to 253 (l-R, 252-D).13
7 Congressional Record. April 18, 1935. House. In floor remarks by Mr. Treadway. p.
8 Congressional Record. April 18,1935. House. In floor remarks by Mr. Jenkins. p. 5993.
9 Congressional Record. April 18, 1935. House. p. 5994.
10 Congressional Record. April 19, 1935. p. 6068.
11 Congressional Record. April 12, 1935. House. In floor remarks by Mr. Treadway. p.
12 Congressional Record. April 19, 1935. House. In floor remarks by Mr. Treadway. p.
13 Congressional Record. April 19, 1935. House. Roll call no. 56, not voting 29. p. 6068-
e.On April 19, 1935, the House passed the Social Security bill by a vote of 372
(77-R, 288-D, 7-I) to 33 (18-R, 13-D, 2-I).14
Long’s (D-LA) proposal to substitute taxes on wealth and property for the payroll
tax; Mr. Clark’s amendment to exempt from coverage employees in firms with
private pensions; Mr. Hastings’ motion to recommit; and the vote on final passage
of the bill.
a.On June 17, 1935, Mr. Long offered an amendment to liberalize the proposed
old-age assistance program (Title I of the bill) and delete the payroll tax
provisions (Title VIII and IX). In place of the payroll tax, Mr. Long
recommended that states levy a tax on wealth or property. Mr. Long’s
amendment was rejected by voice vote.15
b.On June 19, 1935, Mr. Clark (D-MO) offered an amendment to exempt from
coverage under the old-age benefits system employees in firms with private old-
age pension systems. This idea came from an official of a Philadelphia
insurance brokerage firm that specialized in group annuity contracts.
Proponents of the amendment stated that employees would benefit from more
liberal private annuities which would be in true proportion to earnings and
service; joint annuities to protect spouses; earlier retirement for disability; and
other reasons. Supporters of the amendment also maintained that the
government would benefit because the reserves of private annuity plans would
increase investment and create more income to tax. The Administration (being
opposed to the amendment) argued that the amendment did not provide true
retirement income guarantees because private pension programs could be
cancelled, or the firm sponsoring them could go out of business. Critics also
maintained that the amendment discouraged the employment of older men. The
Ways and Means Committee rejected the proposal and so did the Finance
Committee (by a narrow margin), but when Senator Clark offered it as an
amendment on the Senate floor, it was passed by a vote of 51 (16-R, 35-D) to
c.On June 19, 1935, Mr. Hastings (R-DE) made a motion to strike out the old-age
benefits provisions from the bill. Mr. Hastings stated that those provisions were
an effort to write into law a forced annuity system for a certain group of people.
He maintained that the reserve account to take care of people in the future was
not a contract and the American public could not depend upon it. He stated that
the accumulation of huge sums of money for persons who had not yet reached
retirement age would be subjected to many demands and most likely could not
be preserved intact. He also said “let us not deceive that youth by making him
believe that here is an annuity whereby he is contributing 50% and his employer
is contributing 50%, and that it goes to his credit, when as a matter of fact, part
of it is taken from him in order that we may take care of the older people of
14 Congressional Record. April 19, 1935. House. Roll call no. 57, not voting 25. p. 6069-
15 Congressional Record. June 17, 1935. Senate. p. 9427-9437.
16 Congressional Record. June 19, 1935. Senate. Not voting 9. p. 9631.
today.”17 Mr. Hastings’ amendment was rejected by a vote of 15 (12-R, 3-D)
to 63 (7-R, 54-D, 2-I).18
d.On June 19, 1935, Mr. George (D-GA) offered an amendment to encourage
formation of industrial pensions as a substitute for Titles II and VIII. Under the
amendment, employers were to operate and manage their own plans. The
amendment called for a uniform schedule of benefits nationwide and provided
for disability and survivor benefits along with old-age and unemployment
benefits. The amendment was defeated by voice vote.19
e.The Senate passed the bill on June 19, 1935 by a vote of 77 (15-R, 60-D, 2-1)
to 6 (5-R, 1-D).20
3. Conference Action. The conferees settled all differences except on the
Clark amendments related to employees under private pension plans. The conference
committee reported the bill without the Clark amendments, but with an
understanding that the Chairmen of the Ways and Means and Finance Committees
would appoint a special joint committee to study whether to exempt industrial
employers with private pension plans from coverage under Social Security and to
report to the next Congress.21
a.On July 17, 1935, the House rejected Mr. Treadway’s motion to accept the22
Clark amendment by a vote of 78 to 268; then agreed by a vote of 269 to 65
to a motion by Mr. Doughton (D-NC) that the House insist that the Senate drop23
the Clark amendment.
b.On July 17, 1935, the Senate agreed, by voice vote, to Mr. Harrison’s motion24
to insist on keeping the Clark amendment and ask for a further conference.
c.On August 8, 1935, the conference report cleared the House by a voice vote.25
d.On August 9, 1935, the Senate conferees agreed to delete the Clark
amendment;26 the Senate then agreed to the conference report by a voice vote.27
17 Congressional Record. June 17,1935. Senate. In floor remarks by Mr. Hastings. p.
18 Congressional Record. Senate. June 19,1935. Not voting 17. p. 9648.
19 Congressional Record. June 19, 1935. Senate. p. 9650.
20 Congressional Record. June 19, 1935. Senate. Not voting 12. p. 9646.
21 The issue, however, does not appear to have emerged in subsequent Social Security
legislation. It has been said that deferring the Clark amendment was crucial to the passage
of the bill (Derthick, Martha, Policymaking for Social Security. The Brookings Institution,
22 Congressional Record. July 17, 1935. House. Roll call no. 132, not voting 83. p. 11342-
23 Congressional Record. July 17, 1935. House. Roll call no. 133, not voting 95. p. 11343.
24 Congressional Record. July 17, 1935. Senate. p. 11310.
25 Congressional Record. August 8, 1935. House. p. 12760.
26 Congressional Record. August 9, 1935. Senate. p. 12793-12794.
27 Congressional Record. August 9, 1935. Senate. p. 12794.
B. P.L. 379 — 76th Congress, Social Security Amendments
of 1939
H.R. 6635, the Social Security Amendments of 1939, was signed into law on
August 10, 1939, by President Roosevelt. Congress expressly provided in the 1935
Act that the Social Security Board (a three-member panel appointed by the President
with advice and consent of the Senate) study and make recommendations on the most
effective methods of providing economic security through social insurance. An
advisory council appointed by the Senate Special Committee on Social Security and
the Social Security Board was created in May 1937 to work with the Social Security
Board to study amending Titles II and VII of the Social Security Act. Some members
of the advisory council represented employees, some represented employers, and
others represented the general public. Both the Social Security Board and the
advisory council made recommendations on how the old-age benefits program should
be changed, and many of their recommendations were the same. The President sent
the Social Security Board’s recommendations to Congress on January 16, 1939. The
The 1939 amendments extended benefits to dependents and survivors of
workers covered by Social Security. Dependents included an aged wife, a child
under 16 (under 18 if attending school), a widowed mother caring for an eligible
child, an aged widow, and a dependent aged parent if there were no eligible widow
or child. Widows would receive 75% of the primary insurance amount (PIA)28 of the
worker, and all other dependents would receive 50% of the PIA.
The starting date for monthly benefits was accelerated to January 1, 1940,
instead of January 1, 1942. Also, benefits were based on average monthly wages
rather than on cumulative wages. In addition, Congress repealed the tax rate increase
to 1.5%, scheduled to go into effect in 1940, replacing it with an increase to 2% in
1943-45. The amendments also modified qualifying provisions, including the
definition of insured status, for consistency with other changes in the act.29 Further,
people receiving OASI benefits were permitted to earn up to $14.99 monthly: dollar-
for-dollar deductions were to be made for any month in which the recipient earned
$15 or more in covered employment. The system now was called old-age and
survivors insurance (OASI). Congress also changed the old-age reserve account to
a trust fund, managed by a board of trustees.
1. House Action. On June 2, 1939, following public hearings on the
proposed amendments and six weeks of executive sessions, the Committee on Ways
and Means reported to the House H.R. 6635, embodying its recommendations for
amendments to the Social Security Act. The day before, the House had debated and
voted on the Townsend old-age pension bill. The Townsend plan, embodied in H.R.
28 The PIA was the basic benefit amount for a worker who began receiving benefits at age
29 Benefits can be paid to workers or their dependents or survivors only if the worker is
“insured” for these benefits. Insured status is measured in terms of “quarters of coverage.”
A person who had one year of coverage for every two years after 1936 and before death or
reaching age 65 was fully insured.
6466 introduced by Mr. McGroarty (D-CA) in January 1935, was offered as a
substitute for H.R. 6635.30 The Townsend plan would have provided a monthly
pension of $200 to every citizen 60 years of age or older who had not been convicted
of a felony. To receive the pension, a person could not earn wages and was required
to spend the entire pension within 30 days. The plan would have been financed by
a 2% tax on every commercial and financial transaction; the President would have
been given discretionary power to raise the tax to 3% or to lower it to 1%. During
a 1935 Ways and Means Committee hearing, Mr. Townsend stated that his plan was
only incidentally a pension plan. He said the principal objectives of the proposal
were to solve the unemployment problem and to restore prosperity by giving people
purchasing power. He cited Census Bureau data that four million people over the age
of 60 held jobs in 1930. He reiterated that in order to be eligible for the proposed
pension of $200 a month, those elderly people would have to give up their jobs,
which he said meant that 4 million jobs would become available to middle-aged and
younger people. In addition, he said that requiring 8 million elderly persons to buy
$200 worth of goods and services each month would increase demand and result in
more jobs.31
Mr. Sabath (D-IL) said he thought it was “decidedly out of place to bring the
Townsend bill to the floor.” He said that the bill “had no chance of passing in the
first place; neither was it feasible nor possible of operation.”32 Others branded the
bill as “crackpot,” and in general objected because they thought that the Social
Security program was a better means of caring for the aged, asserting that any
liberalization of pensions should be done within the framework of the Social Security
Act.
Mr. Witte, in his book on the development of the Social Security Act, said:
The members of the House of Representatives at all times took the Townsend
movement much more seriously than did the senators. The thousands of letters
that the members received in support of this plan worried them greatly. With the
exception of probably not than a half dozen members, all felt that the Townsend33
plan was utterly impossible; at the same time they hesitated to vote against it.
The House rejected H.R. 6466, the Townsend plan bill, on June 1, 1939, by a
vote of 97 (55-R, 40-D, 2-I) to 302 (107-R, 194-D, 1-I).34
30 The Townsend movement, led by a California doctor named Francis E. Townsend, began
in 1934, survived for some 20 years, and was at its peak in the 1935-1941 period, according
to Derthick, p. 193.
31 U.S. Congress. House. Committee on Ways and Means. Economic Security Act.
Hearings on H.R. 4120, 74th Cong., lst Sess., January 21-31 and February 1, 2, 4-8, and 12,
32 Congressional Record. June 6, 1939. House. p. 6681.
33 Witte, The Development of the Social Security Act, p. 95-96.
34 Congressional Record. June 1, 1939. House. Roll call no. 85, not voting 29. p. 6524-
A New York Times editorial reported that “the psychological effect of the
presentation of the Townsend bill was to make these liberalized benefits (referring
to the provisions in H.R. 6635) seem small. Most of those who voted against the
Townsend plan will be eager to vote for these liberalized benefits to show that their
hearts are in the right place. The result is that the real cost of the new Social Security
scale of benefits is not likely to receive very serious attention.”35
The House took up H.R. 6635 on June 6, 1939. The bill had the general support
of the Ways and Means Committee. The minority stated in the Committee’s report
to the House that “while the bill in no sense represents a complete or satisfactory
solution of the problem of Social Security, it at least makes certain improvements in
the present law (some of which we have ourselves heretofore suggested) which we
believe justify us in supporting it despite its defects.”36
a.On June 9, 1939, Mr. Havenner (D-CA) offered an amendment, endorsed by the
American Federation of Labor, to extend Social Security coverage to workers
employed in college clubs or fraternities or sororities; employees in nonprofit
religious, charitable, or educational institutions; student nurses; and some
agricultural workers. The amendment was rejected by voice vote.37
b.On June 9, 1939, Mr. Kean (R-NJ) offered an amendment that required that the
money derived from the Social Security payroll tax be invested in one-year
marketable U.S. government bonds rather than in special nonmarketable
Treasury obligations. Mr. Kean remarked that the adoption of the amendment
would “prevent the present practice of using old-age taxes for current
expenses.” The amendment was rejected by voice vote.38
c.On June 9, 1939, Mr. Carlson (R-KS) offered an amendment to exclude non-
citizens from coverage under Social Security. Mr. Carlson was opposed to
putting foreigners under the U.S. old-age insurance provisions. Opponents of
the amendment argued that exemption of such people would give employers of
aliens a competitive advantage over vessels owned and manned by Americans.
Mr. Carlson’s amendment was rejected 24 to 59 by a division vote.39
d.On June 10, 1939, Mr. Carlson moved to recommit H.R. 6635 to the Committee
on Ways and Means. The motion was rejected by voice vote.40
e.On June 10, 1939, the House passed H.R. 6635 by a vote of 364 (142-R, 222-D)
to 2 (2-R).41
35 New York Times. June 2, 1939. Editorial page.
36 U.S. Congress. House. Committee on Ways and Means. Social Security Amendments of
Washington, GPO, 1939. p. 113.
37 Congressional Record. June 9, 1939. House. p. 6935.
38 Congressional Record. June 9, 1939. House. p. 6936.
39 Congressional Record. June 9, 1939. House. p. 6937-6939.
40 Congressional Record. June 10, 1939. House. p. 6970.
41 Congressional Record. June 10. 1939. House. Roll call no. 91, not voting 63. p. 6970-
2. Senate Action. On July 13, 1939, Mr. Downey (D-CA), in the course of
his statement on how “unworkable, unjust, and unfair” the Social Security Act was,
moved that the bill be recommitted to the Finance Committee for more study of the
whole pension and savings field. Mr. Downey stated that under H.R. 6635 covered
workers in 1942 would receive only one-half as much in old-age benefits as those
receiving government subsidies (old-age assistance benefits/cash relief). Under H.R.
6635, the average monthly Social Security benefit was projected at between $19 and
$20 for 80% of workers in 1942, whereas the maximum old-age assistance benefit
was $40. The motion was rejected by a vote of 18 (12-R, 5-D, 1-I) to 47 (4-R, 41-D,
a.On July 13, 1939, Mr. Reynolds (D-NC) offered an amendment to prohibit non-
U.S. citizens from being eligible for Social Security coverage or benefits. Mr.
Harrison (D-MS) offered additional language to Mr. Reynolds’ amendment that
allowed benefit payments to aliens if they lived within 50 miles of the U.S. The
amendment as modified was agreed to by voice vote.43
b.The Senate passed H.R. 6635 on July 13, 1939, by a vote of 57 (8-R, 45-D, 4-I)
to 8 (6-R, 2-D).44
3. Conference Action. The conference report was approved by the House
on August 4, 1939, by voice vote,45 and by the Senate on August 5, 1939, by a vote
of 59 (14-R, 42-D, 3-I) to 4 (4-D).46
C. Payroll Tax Freeze, 1942-1947
Between 1942 and 1947, the Social Security payroll tax rate increase was
postponed seven times. It was not until 1950 that the 1% Social Security tax rate was
allowed to rise to 1.5%.
1.The Revenue Act of 1942, P.L. 753 (H.R. 7378, 77th Congress) was
signed by President Roosevelt on October 21, 1942. It provided that for
calendar year 1943, the payroll tax rate for old-age and survivors benefits
would be frozen at the existing rate of 1% for employees and employers,
each, instead of being increased to 2% on each as otherwise would have
been required.
2.P.L. 211, (H.J.Res. 171, 78th Congress), a joint resolution regarding the
Tariff Act, signed by President Roosevelt on December 22, 1943, froze the
payroll tax at the 1% rate until March 1, 1944. The purpose of the
resolution was to give Congress time to consider the scheduled payroll tax
increase before it went into effect.
42 Congressional Record. July 13, 1939. Senate. Not voting 31. p. 9023.
43 Congressional Record. July 13, 1939. Senate. p. 9030.
44 Congressional Record. July 13, 1939. Senate. Not voting 31. p. 9031.
45 Congressional Record. August 4, 1939. House. p. 11092.
46 Congressional Record. August 5, 1939. Senate. Not voting 33. p. 11146.
3.The Revenue Act of 1943, P.L. 235 (H.R. 3687, 78th Congress), was
vetoed by President Roosevelt on February 22, 1944; the veto was
overridden by the House on February 24, 1944 and by the Senate on
February 25, 1944. The bill deferred the scheduled payroll tax increase
(from 1 to 2%) until 1945.
P.L. 235 also contained an amendment by Senator Murray (D-MT) that
authorized the use of general revenues if payroll taxes were insufficient to
meet Social Security benefit obligations. Senator Murray stated that the
amendment merely stated in law what had been implied in the Senate
Committee report. Senator Vandenberg (R-MI) replied that the
amendment “has no immediate application, it has no immediate menace,
it contemplates and anticipates no immediate appropriation; but as the
statement of a principle, I agree with the amendment completely.”47 The
amendment passed by voice vote.48 The “Murray-Vandenberg” general
revenue provision was repealed in 1950, when the tax rate was increased.
1944, froze the payroll tax rate at 1% until 1946 and scheduled the payroll
tax rate to rise to 2.5% for the years 1946 through 1948, and to 3%
thereafter.
5.The Revenue Act of 1945, P.L. 214 (H.R. 4309, 79th Congress), signed by
President Truman on November 8, 1945, deferred the tax rate increase
until 1947.
6.The Social Security Amendments of 1946, P.L. 719 (H.R. 7037, 79th
Congress), signed by President Truman on August 10, 1946, deferred the
tax rate increase until 1948.
7.The Social Security Amendments of 1947, P.L. 379 (H.R. 3818, 80th
Congress), signed by President Truman on August 6, 1947, continued the
freeze on the tax rate increase until 1950 and provided that it would rise to
Members who favored these payroll tax freezes argued that the Social Security
reserves were adequate and that benefit payments in the immediate future could be
met with the current payroll tax rate. In a 1942 letter to the Senate Finance
Committee, President Roosevelt said that “a failure to allow the scheduled increase
in rates to take place under the present favorable circumstances would cause a real
and justifiable fear that adequate funds will not be accumulated to meet the heavy
obligations of the future and that the claims for benefits accruing under the present
law may be jeopardized.” He also stated that “expanded Social Security, together
with other fiscal measures, would set up a bulwark of economic security for the
people now and after the war and at the same time would provide anti-inflationary
47 Congressional Record. January 19, 1944. Senate. In floor statement by Mr.
Vandenberg. p. 374
48 Congressional Record. January 19, 1944. Senate. p. 374.
sources for financing the war.”49 Members who were opposed to the freeze argued
that the scheduled payroll tax increase was important for the long-term soundness of
the OASI trust fund and that postponing the tax increase would mean higher payroll
tax rates in the future and perhaps Government subsidies to meet obligations. Some
proponents of the freeze maintained that the Administration wanted the tax increase
to retire the public debt accumulated by wartime expenditures.
Although Senator Vandenberg (R-MI) was the main spokesman for postponing
the payroll tax increases, the legislative effort to defer tax increases was bipartisan.
“Without regard to party or ideology, elected representatives of the people were not
willing to argue for increases in an earmarked tax if a current need for them could not
be demonstrated,” one scholar observed.50
D. P.L. 492 — 80th Congress, 1948 Provision for Exclusion
of Certain Newspaper and Magazine Vendors From Social
Security Coverage (H.R. 5052) and P.L. 642 — 80th Congress,
1948 Provision to Maintain Status Quo Concept of Employee
Two pieces of 1948 legislation, H.R. 5052 and H.J.Res. 296, settled the
argument of who was considered an employee for purposes of Social Security
coverage. The term “employee” was not defined in the Social Security Act or in the
Internal Revenue Code. However, in 1936 the Social Security Board and the
Treasury Department issued regulations that to a certain extent explained the
meaning of the terms “employee” and “employer.” In defining “employer,” both sets
of regulations emphasized the concept of “control” — the right to give instructions,
but other significant factors such as the right to discharge, the furnishing of tools and
a place to work were also mentioned in the regulations. During the next few years,
the Social Security Board and the Treasury Department issued numerous rulings to
clarify the boundaries of the employee-employer relationship and a number of court
cases established generally applicable precedents. The common-law meaning of the
term employee, however, was very unclear in cases of outside salesmen.51
On December 31, 1946, the U.S. district court, in the case of Hearst
Publications, Inc. v. The United States, ruled that newspaper vendors should be
considered employees rather than independent contractors. H.R. 5052, introduced
in 1948, proposed to treat newspaper and magazine vendors as independent
contractors rather than employees and thereby to exclude them from Social Security
coverage. In addition, in 1948 Congress addressed the broader issue of who was to
be considered an employee by passing H.J.Res. 296, a resolution to maintain the
status quo of treating newspaper vendors as independent contractors, by stating that
Congress, not the courts nor the Social Security Administration (SSA), should
49 Congressional Record. October 9, 1942. Senate. p. 7983-7984.
50 Derthick, Policymaking for Social Security. p. 237.
51 Social Security Administration. “Social Security Legislation. January-June 1948:
Legislative History and Background” (by) Wilbur Cohen and James L. Calhoon. Social
Security Bulletin, v. 11, no. 7, July 1948. p. 3-11.
determine national policy regarding Social Security coverage. It was reported that
H.J.Res. 296 was primarily introduced to prevent the release of new federal
regulations defining the meaning of the term “employee” along the lines interpreted
by the Supreme Court in three cases decided in June 1947.52 H.J.Res. 296 excluded
from Social Security coverage (and unemployment insurance) any person who was
not considered an employee under the common-law rules. In effect, H.J.Res. 296
said that independent contractors (e.g., door-to-door salesmen, insurance salesmen,
and pieceworkers) were not to be considered employees. H.R. 5052 and H.J.Res. 296
were vetoed by President Truman. Congress overrode both vetoes.
In his veto of H.R. 5052, President Truman asserted that the Nation’s security
and welfare demanded that Social Security be expanded to cover the groups excluded
from the program: “Any step in the opposite direction can only serve to undermine
the program and destroy the confidence of our people in the permanence of its
protection against the hazards of old age, premature death, and unemployment.”53
The action taken on H.R. 5052 illustrated the controversial issues involved in
determining who should be covered under Social Security.
1. House Action. On March 4, 1948, Mr. Gearhart (R-CA) asked unanimous
consent for immediate consideration of H.R. 5052. Mr. Gearhart stated that “until
the rendition of the federal court decisions I have referred to were rendered the status
of the newspaper and magazine vendors was considered by everyone, and as this
Congress clearly intended, to be that of independent contractors since they bought
their periodicals at a low price and sold them at a higher price, deriving their54
livelihood from the profit in the operation.” Under the court decisions “these
vendors were arbitrarily declared to be employees and therefore subject to the payroll
taxes though the money they receive is not wages, as generally understood, but
profits derived from an independent business operation of their own.” Under the
court decisions, newspaper and magazine vendors were in essence “employees” of
all of the newspaper and magazine companies with which they had an arrangement.
H.R. 5052 excluded newspaper and magazine vendors from coverage under the
Social Security Act. Mr. Gearhart stated in his remarks that “when newspaper
vendors are covered into the Social Security system — and I believe they will be by
act of Congress before this session ends — they will be brought in as the independent
contractors which they are, as the self-employed ...” H.R. 5052 was passed in the
House on March 4, 1948, by unanimous consent.55
c.On February 27, 1948, H.J.Res. 296 was passed by a vote of 275 to 52.56
52 Ibid.
53 Congressional Record. April 6, 1948. House. p. 4134.
54 United States v. Silk (67 S. Ct. 1463), Harrison v. Grayvan Lines, Inc. (67 S. Ct. 1463),
and Bartels v. Birmingham (67 S. Ct. 1547).
55 Congressional Record. March 4, 1948. House. p. 2143.
56 Congressional Record. February 27, 1948. House. Roll call no.18, not voting 103. p.
2. Senate Action. On March 23, 1948, the Senate passed by unanimous
consent H.R. 5052 in form identical to that passed by the House.57
a.On June 4, 1948, H.J.Res. 296 was passed, after public assistance amendments58
increasing federal assistance to states were added, by a vote of 74 to 6.
Although there was no conference on H.J.Res. 296, the House concurred in the59
Senate amendments on June 4, 1948 by voice vote.
a.On April 6, 1948, in the veto message on H.R. 5052, President Truman stated
that some vendors work under arrangements “which make them bona fide
employees of the publishers, and, consequently, are entitled to the benefits of
the Social Security Act.” President Truman further stated that “It is said that
news vendors affected by this bill could more appropriately be covered by the
Social Security laws as independent contractors when and if coverage is
extended to the self-employed. Whether that is true or not, surely they should
continue to receive the benefits to which they are now entitled until the broader
coverage is provided. It would be most inequitable to extinguish their present
rights pending a determination as to whether it is more appropriate for them to60
be covered on some other basis.”
b.On June 14, 1948, President Truman vetoed H.J.Res. 296, saying that “If our
Social Security program is to endure, it must be protected against these
piecemeal attacks. Coverage must be permanently expanded and no employer
or special group of employers should be permitted to reverse that trend by
efforts to avoid the burden which millions of other employers have carried61
without serious inconvenience or complaint.”
a.The House overrode President Truman’s veto of H.R. 5052 and passed the bill
on April 14, 1948, by a vote of 308 (207-R, 101-D) to 28 (2-R, 24-D. 2-I).62 On
April 20, 1948, the Senate overrode the President’s veto and passed H.R. 5052
by a vote of 77 (48-R, 29-D) to 7 (7-D).63
57 Congressional Record. March 23, 1948. Senate, p. 3267
58 Congressional Record. June 4. 1948. Senate. Not voting 16. p. 7134
59 Congressional Record. June 4, 1948. House. p. 7215.
60 Congressional Record. April 6, 1948. House. p. 4134.
61 Congressional Record. June 14. 1948. House. p. 8188.
62 Congressional Record. April 14, 1948. House. Roll call no. 44, not voting 93. p. 4432.
63 Congressional Record. April 20, 1948. Senate. Not voting 12. p. 4594.
b.On June 14, 1948, President Truman’s veto of H.J.Res. 296 was overridden in
the House by a vote of 298 to 75;64 and in the Senate by a vote of 65 (37-R, 28-
D) to 12 (2-R, 10-D).65
E. P.L. 734 — 81st Congress, Social Security Act
Amendments of 1950
H.R. 6000, the Social Security Act Amendments of 1950, was signed by
President Truman on August 28, 1950. H.R. 6000 broadened the Social Security Act
to cover roughly 10 million additional persons, including regularly employed farm
and domestic workers, self-employed people other than doctors, lawyers, engineers
and certain other professional groups, certain federal employees not covered by
government pension plans, and workers in Puerto Rico and the Virgin Islands. On
a voluntary group basis, coverage was offered to employees of state and local
governments not under public employee retirement systems and to employees of
nonprofit organizations. Dependent husbands, widowers, and, under certain
circumstances children of insured women were also made eligible for benefits
(before, such benefits were not generally available to children of women workers).
In addition, Congress raised benefits by about 77%; raised the wage base from
$3,000 to $3,600; raised employer and employee taxes gradually from 1.5% to an
ultimate rate of 3.25% each in 1970 and years thereafter; set the OASI tax rate for the
self-employed at 75% of the combined employer-employee rate; eased requirements
for eligibility for benefits by making 1950 the starting date for most people in
determining the quarters of coverage needed; permitted recipients to have higher
earnings ($50 a month) without losing any OASI benefits (those aged 75 and over
could now earn any amount without losing OASI benefits); and gave free wage
credits of $160 for each month in which military service was performed between66
September 16, 1940, and July 24, 1947.
1. House Action. On August 22, 1949, the Committee on Ways and Means
reported H.R. 6000. H.R. 6000 did not include President Truman’s
recommendations for health insurance or his request to lower the OASI eligibility age
to 60 for women, but it did include disability protection for both Social Security and
public assistance recipients. It also extended coverage to farm and domestic workers.
All 10 Republicans on the Committee (including seven who voted to send H.R.
6000 to the floor) filed a minority report stating that OASI coverage and benefits
should be limited so as to provide only a “basic floor” of economic protection. The
64 Congressional Record. June 14, 1948. House. Roll call no. 105. Not voting 57. p. 8191.
65 Congressional Record. June 14, 1948. Senate. Not voting 19. p. 8093.
66 Several subsequent pieces of legislation during the early 1950s extended these wage
credits to periods of service up to December 31, 1956. The 1967 amendments gave military
wage credits of $300 per calendar quarter of service after 1967 (amended in 1972 to be
effective in 1957). The 1977 amendments gave wage credits of $100 per $300 of basic pay,
up to a maximum of $1,200 credit per year, beginning in 1978.
minority report opposed the disability insurance provision, saying that aid to the
disabled should be limited to charity aid provided under the proposed public
assistance program for the permanently and totally disabled.67
The Committee on Rules at first refused to send H.R. 6000 to the floor, but,
after much debate, a closed rule barring floor amendments was granted. A number
of Members opposed the rule because they said it foreclosed their right to improve
the bill through floor amendments.
a.On October 4, 1949, Mr. Sabath (D-IL) offered a resolution for four days of
debate, with only the Committee on Ways and Means having the right to offer
amendments, and with only a motion to recommit being in order. Those
favoring the resolution stated that the Ways and Means Committee had devoted
six months to considering the bill, had heard testimony from 250 witnesses and
thus knew best how to improve the program. Those opposing the closed rule
said the bill was very controversial and that the whole House should settle
difficult questions of policy. They said the closed rule negated the importance
of other House Members and usurped their rights.
The House agreed to the resolution for a closed rule by a vote of 189 (12-R,
b.On October 5, 1949, Mr. Mason (R-IL) moved to recommit H.R. 6000, and
offered H.R. 6297 (a bill that carried out the minority view on H.R. 6000) as its
substitute. H.R. 6297, introduced by Mr. Kean (R-NJ) on October 3, 1949, held
the wage base to $3,000; recommended greater coverage for domestic workers
so that those who were less regularly employed would be included; exempted
teachers, firemen, and policemen with their own pension systems from
coverage; confined disability payments to the public assistance program; and
recommended that Congress establish an independent Social Security system in
Puerto Rico, the Virgin Islands, and other possessions rather than include them
in the existing OASI program.
The motion to recommit was defeated by a vote of 113 (112-R, 1-D) to 232 (29-
R, 202-D, 1-I).69
c.Immediately following the rejection of the motion, H.R. 6000 was passed in the
House by a vote of 333 (R-130, D-202, 1-I) to 14 (R-12, D-2).70
67 U.S. Congress. House. Committee on Ways and Means. Social Security Act of 1949.
Report to Accompany H.R. 6000. Report No. 1300. 81st Cong., 1st Sess. Washington,
GPO, 1949. p. 157-165.
68 Congressional Record. October 4, 1949. House. Roll call no. 215, not voting 106. p.
69 Congressional Record. October 5, 1949. House. Roll call no. 217, not voting 84. p.
70 Congressional Record. October 5, 1949. House. Roll call no. 218, not voting-84. p.
(continued...)
the Senate did not consider H.R. 6000 until 1950. The Senate Finance Committee
held extensive hearings and adopted many amendments to H.R. 6000. The
Committee stated that the chief purpose of the bill was to strengthen the OAS1
system so that OASI would be the primary method of offering “basic security to
retired persons and survivors,”71 with public assistance (particularly old-age
assistance) playing strictly a supplementary and secondary role. The Finance
Committee version of the bill did not include the disability insurance provision
passed by the House nor the provision providing federal grants to states for needy
persons who were permanently and totally disabled, nor President Truman’s health
insurance proposal. The bill was reported to the Senate on May 17, 1950, and debate
began on June 12, 1950.
a.On June 14, 1950, following a Senate Republican Policy Committee meeting,
Mr. Millikin (R-CO) and Mr. Taft (R-OH) indicated that Republicans would
support H.R. 6000 but favored a study to determine whether the OASI and old-
age assistance programs eventually should be united in a universal pay-as-you-
go system. Under this proposal, all elderly persons in the United States would
become eligible for subsistence-level pensions at age 65, with pension amounts
the same for all (rather than varied to reflect earnings during the work career),72
and financed from current revenues rather than a trust fund.
b.An amendment offered by Mr. Myers (D-PA) to add a disability insurance73
program to OASI was rejected by a voice vote.
c.On June 20, 1950, another amendment offered by Mr. Myers to boost the OASI
wage base from $3,000 to $4,200, closer to what President Truman had
requested (instead of $3,600 specified in the George amendment — see below),74
was rejected 36 (9-R, 27-D) to 45 (27-R, 18-D).
d.On June 20, 1950, Mr. Long (D-LA) introduced an amendment to provide
federal grants to States for needy disabled persons. The amendment was rejected
by a vote of 41 (4-R, 37-D) to 42 (33-R, 9-D).75
e.On June 20, 1950, Mr. George’s (D-GA) amendment to increase the basic wage
base from $3,000 to $3,600 was agreed to by voice vote.76
70 (...continued)
71 U.S. Congress. Senate. Committee on Finance. Social Security Act Amendments of 1950.
Report to Accompany H.R. 6000. Report No.1669, 81st Cong., 2d Sess. May 17, 1950.
Washington, GPO, 1950. p. 2.
72 Congress and the Nation: 1945-1964. Washington, Congressional Quarterly Inc., 1965.
p. 1243.
73 Congressional Record. June 20, 1950. Senate. p. 8904.
74 Congressional Record. June 20, 1950. Senate. Not voting 15. p. 8883.
75 Congressional Record. June 20, 1950. Senate. Not voting 13. p. 8889.
76 Congressional Record. June 20, 1950. Senate. p. 8883.
f.On June 20, 1950, by a voice vote, the Senate adopted S.Res. 300, authorizing
a study of a universal pay-as-you-go old-age pension system.77
g.The Senate passed H.R. 6000 on June 20 by a vote of 81 (35-R, 47-D) to 2 (2-
R).78
but retained the public assistance program for the permanently and totally disabled
(the so-called charity approach). The conference report was submitted to the House
on August 1, 1950.
a.On August 16, 1950, Mr. Byrnes (R-WI) moved to recommit the conference
report on H.R. 6000. He stated that his main reason for doing so was to prevent
any attempt to remove from the bill a Senate floor amendment by Mr.
Knowland (R-CA) to reduce federal control over state administration of
unemployment insurance. Mr. Doughton (D-NC) moved the previous question
on the motion to recommit.79 The motion on the previous question was passed
by a vote of 188 (120-R, 68-D) to 186 (20-R, l65-D, 1-I). The motion to
recommit the conference report was rejected.
b.The conference report passed the House on August 16, 1950, 374 (140-R, 234-
D) to 1 (l-R);80 and the Senate on August 17, 1950, by voice vote.81
F. P.L. 590 — 82nd Congress, Social Security Act
Amendments of 1952
H.R. 7800, the Social Security Amendments of 1952, was signed into law on
July 18, 1952, by President Truman. The amendments increased OASI benefits for
both present and future recipients (by an average of 15% for those on the rolls),
permitted recipients to earn $75 a month (instead of $50) without losing OASI
benefits, extended wage credits of $160 for each month in which active military or
naval service was performed during the period from July 24, 1947, through
December 1953, and provided for a disability “freeze,” which in principle preserved
the Social Security benefits of qualified workers who became permanently and totally
disabled before retirement by averaging the person’s wages only over his or her
working years. (See following conference action section for more details.)
1. House Action. In the House, debate centered largely on a so-called
“disability freeze” proposed by the Committee on Ways and Means. Under the
provision, if a person became permanently and totally disabled, the period of
77 Congressional Record. June 20, 1950. Senate. p. 8878.
78 Congressional Record. June 20,1950. Senate. Not voting 13. p. 8910.
79 A motion for the previous question, when carried, has the effect of stopping all debate and
amendments, forcing a vote on the pending matter. This parliamentary maneuver is used
only in the House.
80 Congressional Record. August 16, 1950. House. Roll call no. 242, not voting 55. p.
81 Congressional Record. August 17, 1950. House. p. 12718.
disability was to be excluded in computing the number of quarters of coverage he or
she needed to be eligible for benefits, and in computing the average earnings on
which the benefits would be based. The provision, in effect, preserved benefit rights
while a person was disabled. Medical examinations by doctors and public
institutions would be designated and paid for by the Federal Security Agency (FSA).
The American Medical Association (AMA) claimed that this arrangement would lead
to socialized medicine. Mr. Reed (R-NY), the minority leader of the Ways and
Means Committee, was the primary spokesman for Members who endorsed the AMA
position.
a.On May 19, 1952, when H.R. 7800 was brought to the floor under suspension
of the rules procedure — requiring a two-thirds vote for passage and barring
amendments — the majority of Republicans voted against it because of the
disability provision, and it was rejected by a vote of 151 (52-R, 98-D, 1-I) to
b.On June 16, 1952, Democratic leaders brought H.R. 7800 to the floor under
suspension of the rules. An amended version of the revised bill empowered the
FSA to make disability determinations, but omitted the language specifying how
the FSA administrator should do so. Mr. Reed said “. . . let no person on this
floor be deceived. You have the same old H.R. 7800 here before you. While
the socialized medicine advocates pretend to remove the specific instructions
to the Administrator, they now give him more powers under general provisions
of the law than he had before. You have socialized medicine here stronger in
this bill than was H.R. 7800, heretofore defeated.”83 Mr. Reed later contended
that because of the approaching election many Members chose to go on record
in favor of the other OASI provisions and so voted for the amended version of
H.R. 7800. The bill was approved 361 (165-R, 195-D, 1-I) to 22 (20-R, 2-D)
on June 17, 1952.84
2. Senate Action. When the bill came to the Senate Finance Committee, it
dropped the disability freeze provision. The Finance Committee said there was
inadequate time to study the issue properly.
a. The Committee amendment, offered by Mr. George (D-GA), to drop the85
disability freeze provision, was passed by voice vote on June 26, 1952.
b.H.R. 7800 (without the disability freeze provision) was passed in the Senate by86
a voice vote on June 26, 1952.
3. Conference Action. The conferees retained the disability freeze
provision, in principle. The compromise terminated the freeze provision on June 30,
82 Congressional Record. May 19, 1952. House. Roll call no. 79, not voting 139. p. 5483-
83 Congressional Record. June 16, 1952. House. p. 7293.
84 Congressional Record. June 17, 1952. House. Roll call no. 106, not voting 46. p. 7387.
85 Congressional Record. June 26, 1952. Senate. p. 8141.
86 Congressional Record. June 26, 1952. Senate. p. 8155.
in subsequent legislation, were to take action to remove the bar. The stated intent in
making the provision inoperative was to permit “the working out of tentative
agreements with the States for possible administration of these provisions.”87 In
addition, the conferees gave responsibility for determining whether an applicant was
disabled to appropriate state agencies (public assistance, vocational rehabilitation, or
workmen’s compensation), instead of the FSA. The Federal Security Administrator
would be able to overturn a ruling by the State agencies that a person was disabled,
but would not be able to reverse a ruling by the State agencies that a person was not
disabled.
a.The conference report was agreed to July 5, 1952, by voice votes in both
cham bers. 88
G. P.L. 761 — 83d Congress, Social Security Amendments of
1954
H.R. 9366, the Social Security Amendments of 1954, was signed by President
Eisenhower on September 1, 1954. In his 1953 State of the Union Message, the
President recommended that “OASI should promptly be expanded to cover millions
of citizens who have been left out of the Social Security system.” The Social
Security Amendments of 1954 extended mandatory coverage to, among others, some
self-employed farmers, self-employed engineers, architects, accountants, and funeral
directors, all federal employees not covered by government pension plans, farm and
domestic service workers not covered by the 1950 amendments, and voluntary
coverage to ministers and certain state and local government employees already
covered by staff retirement systems. The bill also raised the wage base for the OASI
tax to $4,200; raised the tax rate to 3.5%, each, for employers and employees
beginning in 1970, and to 4.0%, each, beginning in 1975, with the tax rate for the
self-employed continuing at 1.5 times the employee rate (or 75% of the combined
employee-employer rate). OASI benefits for recipients were raised by roughly 15%,
with the maximum individual benefit rising from $85 to $98.50 a month, and a
revised benefit formula was provided for future retirees that increased benefits by
roughly 27%, with the maximum benefit rising from $85 a month to $108.50. The
bill also put the disability freeze into effect (see discussion of House action on the
1952 amendments, beginning on page 20), with disability determinations to be made
by the appropriate State agencies, permitted a recipient to earn up to $1,200 a year
without deductions, eliminated the earnings test for people age 72 and over, and
dropped the five years of lowest earnings from average monthly wage determinations
for benefit computation purposes.
87 U.S. Congress. Conference Committee. 1952. Social Security Act Amendments of 1952.
Conference Report to Accompany H.R. 7800. July 1952. House Report No.2491, 82d
Cong., 2d Sess. Washington, GPO, 1952. p. 9.
88 Congressional Record. July 5, 1952. House. p. 9670. Also see, Congressional Record.
July 5, 1952. Senate. p. 9523.
1. House Action. On June 1, 1954, Mr. Smith (D-VA) and other farm area
Democrats objected to bringing H.R. 9366 to the floor under a closed rule because
coverage of farmers was included in the bill. Mr. Smith stated, “I object to the
feature of this bill that prohibits you from offering any amendment. I think that
requires a little discussion and a little understanding. We all agree that on an
ordinary tax bill it is not feasible or practical to write it on the floor of the House, and
therefore we have adopted the theory that we have closed rules on tax bills ... all we
asked for in the Rules Committee was that the individual members of this House be
given an opportunity to offer amendments to designate what classifications of
persons should be included.”89 On June 1, 1954, by a vote of 270 (171-R, 98-D, 1-I)90
to 76 (5-R, 71-D), debate of the closed rule was cut off, and the closed rule was
then adopted by voice vote.
a.The House bill also included provisions extending mandatory coverage to all
self-employed professionals but doctors (dentists and other medical
professionals would have been covered under the House bill).91
b.The House passed H.R. 9366 on June 1, 1954, by a vote of 356 (18l-R, 174-D,
2. Senate Action. H.R. 9366 as reported by the Finance Committee included
the coverage of farm and domestic service workers, ministers, employees of state and
local governments covered by a retirement system, and a small number of
professionals. It also increased the earnings test threshold to $1,200 a year, reduced
to 72 the age at the earnings test no longer applied, and increased the lump-sum death
benefit from $255 to $325.50. During the Senate debate on H.R. 9366, nine
amendments were adopted, six were rejected, and six were presented and then
withdrawn.93
a.Among the amendments adopted on the floor by the Senate was a provision by
Mr. Long (D-LA) to require the Department of Health, Education, and Welfare
to study the feasibility and costs of providing increased minimum benefits of
$55, $60, and $75 a month under the Social Security program. On August 13,
b.Among the amendments defeated were the Johnston (D-SC) amendment to
reduce the Social Security eligibility age to 60; the Stennis (D-MS) amendments
89 Congressional Record. June 1, 1954. House. In floor remarks by Mr. Smith. p. 7423.
90 Congressional Record. House. June 1, 1954. Roll call no.77, not voting 87. p. 7425.
91 The American Dental Association (ADA) and the American Medical Association (AMA)
strongly opposed Social Security coverage for their groups. The AMA said it was
incompatible with the free enterprise system. Congressional Record. August 13, 1954.
Senate. In floor remarks by Mr. Millikin (R-CO). p. 14422.
92 Congressional Record. June 1, 1954. House. Roll call no. 78, not voting 68. p. 7468.
93 Social Security Administration. “Social Security Act Amendments of 1954: A Summary
and Legislative History” [by] Wilbur J. Cohen, Robert M. Ball, and Robert J. Myers. Social
Security Bulletin, v. 17, no. 9, September 1954. p. 3-18.
94 Congressional Record. August 13, 1954. Senate. p. 14442.
that would have left the coverage of farm workers unchanged; and the
Humphrey (D-MN) amendment to increase the widow’s benefit to 100% of the
primary insurance amount. On August 13, 1954, Mr. Johnston’s amendment
was rejected by voice vote.95 On August 13, 1954, the Stennis amendments
were rejected en bloc by voice vote.96 On August 13, 1954, Mr. Humphrey’s
amendment was rejected on a division vote.97
c.Among the amendments that were presented and then withdrawn was an
amendment by Mr. Lehman (D-NY) to extend Social Security coverage,
increase benefits, add permanent and total disability and temporary disability
Social Security benefits, and to make other changes.98
d.On August 13, 1954, the Senate passed H.R. 9366, by voice vote.99
3. Conference Action. The conferees, among other things, accepted a
provision mandatorily covering self-employed farmers, accountants, architects,
engineers, and funeral directors, but excluding lawyers, doctors, dentists, or other
medical professionals, and extended coverage to federal employees not covered by
staff retirement systems.
a.Both chambers agreed to the conference report without amendments by voice
vote on August 20, 1954, the last day of the session.100
H. P.L. 880 — 84th Congress, Social Security Amendments
of 1956
H.R. 7225, the Social Security Amendments of 1956, was signed by President
Eisenhower on August 1, 1956. The amendments provided benefits, after a
six-month waiting period, for permanently and totally disabled workers aged 50 to
64 who were fully insured and had at least 5 years of coverage in the 10-year period
before becoming disabled; to a dependent child 18 and older of a deceased or retired
insured worker if the child became disabled before age 18; to women workers and
wives at the age of 62, instead of 65, with actuarially reduced benefits; reduced from
65 to 62 the age at which benefits were payable to widows or parents, with no
reduction; extended coverage to lawyers, dentists, veterinarians, optometrists, and all
other self-employed professionals except doctors;101 increased the tax rate by 0.25%
95 Congressional Record. August 13, 1954. Senate. p. 14433.
96 Congressional Record. August 13, 1954. Senate. p. 14435.
97 Congressional Record. August 13, 1954. Senate. p. 14444.
98 Congressional Record. August 13, 1954. Senate. p. 14419.
99 Congressional Record. August 13, 1954. Senate. p. 14446.
100 Congressional Record. August 20, 1954. House. p. 15544. Also, Congressional
Record. August 20, 1954. Senate. p. 15414.
101 P.L. 881 — 84th Congress, the Servicemen’s and Veterans’ Survivor Benefit Act (H.R.
7089), extended coverage of the OASDI system to members of the uniformed services on
active duty on a permanent contributory basis beginning in 1957. It was signed into law on
(continued...)
on employer and employee each (0.375% for self-employed people) to finance
disability benefits (thereby raising the aggregate tax rate ultimately to 4.25%); and
created a separate disability insurance (DI) trust fund. The Social Security program
now consisted of old-age, survivors, and disability insurance (OASDI).
1. House Action. Major House Ways and Means Committee provisions
provided benefits to disabled persons age 50 and older and reduced the age at which
women could first receive OASI benefits to 62. Although some Members maintained
that not enough time was spent in working out the details of these two controversial
provisions, H.R. 7225 was brought to the floor under suspension of the rules, which
barred floor amendments and required a two-thirds vote for passage. H.R. 7225 was
passed by the House on July 18, 1955, by a vote of 372 (169-R, 203-D) to 31 (23-R,102
passed bill, the Secretary of Health, Education, and Welfare, Mr. Folsom, stated that
the Administration was opposed to reducing the retirement age to 62 for women and
providing disability benefits. According to Congress and the Nation, Mr. Folsom
said that OASI had stayed actuarially sound without excessive taxes because it had
been restricted to one purpose with “predictable costs”: providing income for the
aged.103 Spokesmen for the AFL-CIO and several other groups maintained that union
experience with welfare plans and federal studies dating back to 1937 showed that
disability insurance was both administratively and financially sound.
a.On June 5, 1956, the Senate Finance Committee reported H.R. 7225 after
eliminating the Disability Insurance program and the tax increase to pay for it,
and limiting retirement benefits at age 62 to widows only.
b.On July 17, 1956, Mr. George (D-GA) offered an amendment reinstating the
Disability Insurance program and the tax increase to finance it. The amendment
provided for a separate disability insurance trust fund (instead of operating the
new program out of the OASI fund). The amendment was passed by a vote of
c.Also, on July 17, 1956, the Senate agreed to Mr. Kerr’s (D-OK) amendment to
permit women to receive benefits at age 62 at actuarially reduced rates. The
amendment passed by a vote of 86 (40-R, 46-D) to 7 (5-R, 2-D).105
101 (...continued)
August 1, 1956.
102 Congressional Record. July 18, 1955. House. Roll call no. 119, not voting 29. p.
103 Mr. Folsom stated that until the ultimate costs were known, whether it was possible to
make disability determinations good enough to avoid “fraudulent’ claims for benefits, and
whether disability pensions might discourage individual rehabilitative efforts, adding
disability insurance to OASI would risk “overburdening and thus wrecking” the Social
Security system. Congress and the Nation: 1945-1964. p. 1251.
104 Congressional Record. July 17, 1956. Senate. Not voting 4. p. 13056.
105 Congressional Record. July 17, 1956. Senate. Not voting 3. p. 13073.
d.On July 17, 1956, the Senate passed H.R. 7225 by a vote of 90 (45-R, 45-D) to
July 27, 1956, cleared the conference report on H.R. 7225 without amendments by
voice votes.
I. P.L. 85-840, Social Security Amendments of 1958
H.R. 13549, the Social Security Amendments of 1958, was signed by President
Eisenhower on August 28, 1958. The amendments raised recipients’ benefits an
average of 7%, with benefits ranging from $33 to $127 per month for future
recipients; increased maximum family benefits from $200 to $254; raised the wage
base from $4,200 to $4,800 a year; increased the tax rate by 0.25% on employers and
employees each and 0.375% for the self-employed; provided benefits to dependents
of workers receiving disability benefits; and permitted the aged dependent parents of
an insured deceased worker to receive survivors’ benefits even if the worker’s widow
or dependent widower or child were alive and also eligible for benefits.
1. House Action. Most of the controversy over H.R. 13549 pertained to
public assistance programs. There was relatively little controversy over the proposed
OASDI provisions. During debate on H.R. 13549, Mr. Reed (R-NY) stated that the
bill would strengthen the actuarial soundness of the Social Security program.109
a.On July 31, 1958, the House passed H.R. 13549 by a vote of 374 to 2.110
2. Senate Action. On August 15, 1958, Mr. Yarborough (D-TX) offered an
amendment to increase benefits by 10%, rather than 7%, as proposed in H.R. 13549.
Mr. Yarborough stated that in many states old-age public assistance payments were
higher than the “Social Security payments the people have earned by putting their111
money into the Social Security fund.”
a.Proponents of the amendment mentioned that a 10% increase would alleviate
erosion of benefits due to inflation. Opponents of the amendment argued that
many persons getting Social Security also received income from other sources.
Some opponents of the amendment maintained that it would jeopardize the
106 Congressional Record. July 17, 1956. Senate. Not voting 6. p. 13103.
107 Congressional Record. July 26, 1956. House. p. 14828.
108 Congressional Record. July 26, 1956. Senate. p. 15107.
109 Congressional Record. July 31, 1958. House. p. 15740.
110 Congressional Record. July 31, 1958. House. Roll call no. 149, not voting 54. p.
111 Congressional Record. August I5, 1958. Senate. p. 17798.
enactment of the bill. Mr. Yarborough’s amendment was rejected by a vote of
b.On August 16, 1958, Mr. Kennedy (D-MA) offered an amendment to increase
Social Security benefits by 8% (rather than 7%). The Kennedy-Case
amendment was rejected by voice vote.113
c.On August 16, 1958, Mr. Morse (D-OR) offered an amendment to increase
Social Security benefits by 25%, to provide health insurance, and to make other
changes. Mr. Morse’s amendment was rejected by voice vote.114
dOn August 16, 1958, Mr. Humphrey (D-MN) offered an amendment to provide
health insurance (Mr. Morse’s amendment was based in part on this Humphrey
amendment). Mr. Humphrey withdrew his amendment.115
e.On August 16, 1958, Mr. Kennedy offered an amendment for himself and Mr.
Smathers (D-NJ) to eliminate the dollar ceiling of $255 on the lump-sum death
benefit and restore the 3-to-1 ratio between the death benefit and the regular
monthly benefit. The amendment was rejected by voice vote.116
f.On August 16, 1958, Mr. Revercomb (R-WV) offered an amendment to provide
full Social Security retirement benefits at age 62, for both men and women. Mr.
Revercomb’s amendment was rejected by voice vote.117
g.The Senate passed H.R. 13549 on August 16, 1958, by a vote of 79 (37-R, 42-
D) to 0.118
agreed to the Senate amendments.
J. P.L. 86-778, Social Security Amendments of 1960
H.R. 12580, the Social Security Amendments of 1960, was signed by President
Eisenhower on September 13, 1960. Health care for the aged was the primary issue
in 1960. At the crux of the debate was the question of whether the federal
government should assume major responsibility for the health care of the Nation’s
elderly people, and, if so, whether medical assistance should be provided through the
Social Security system or through the public assistance programs (charity approach).
The 1960 amendments provided more federal funds for old-age assistance
(OAA) programs so that states could choose to improve or establish medical care
services to OAA recipients. In addition, the legislation known as “Kerr-Mills”
established a new voluntary program (under jurisdiction of the OAA program) of
112 Congressional Record. August 16, 1958 . Senate. Not voting 11. p. 17971-17972.
113 Congressional Record. August 16, 1958. Senate. p. 17985.
114 Congressional Record. August 16, 1958. Senate. p. 18005.
115 Congressional Record. August 16, 1958. Senate. p. 18008.
116 Congressional Record. August 16, 1958. Senate. p. 17986.
117 Congressional Record. August 16, 1958. Senate. p. 17982.
118 Congressional Record. August 16, 1958. Senate. Not voting 17. p. 18014.
119 Congressional Record. August 19, 1958. House. p. 18540.
medical assistance for the aged, under which states received federal funds to help pay
for medical care for persons aged 65 and older who were not recipients of OAA but
whose income and resources were insufficient to meet their medical expenses.
The 1960 amendments also contained a number of OASDI provisions. The
amendments made disability benefits available to workers under age 50; established
a new earnings test whereby each dollar of yearly earnings between $1,200 and
$1,500 would cause only a 50-cent reduction in benefits with a dollar-for-dollar
reduction for earnings above $1,500; liberalized requirements for fully insured status
so that to be eligible for benefits a person needed only one quarter of covered work
for every three calendar quarters (rather than 1 for every 2 quarters, as under the old
law) elapsing after 1950 and before retirement, disability, or death; and raised the
survivor benefit of each child to 75% of the parent’s PIA.
1. House Action. H.R. 12580 as reported by the Ways and Means
Committee contained two medical care provisions for elderly people. The first
provision provided the states with additional funding to improve or to establish
medical care programs for old-age assistance recipients. The second provision
established a new federal-state program (under a new title of the Social Security Act)
designed to assist aged persons who were not eligible for public assistance but who
were unable to pay their medical bills.
The Ways and Means Committee rejected H.R. 4700, introduced by Mr. Forand
(D-RI), which would have provided insurance against the cost of hospital, nursing120
home, and surgical services for OASDI recipients, by a vote of 17 to 8.
Proponents of H.R. 12580 said that it provided medical assistance for every
aged person in any state that implemented a medical assistance program. Mr.
Thompson (D-NJ), a supporter of the Forand bill stated that, under H.R. 12580,
people would be “denied the opportunity of contributing to their old-age health
insurance coverage while employed and would be forced to rely upon charity after
their working days were over.”121 He contended further that “even this charity . . .122
is contingent upon the action of the separate states.”
a.The House passed H.R. 12580 on June 23, 1960, by a vote of 381 (137-R, 244-
D) to 23 (7-R, 16-D).123
2. Senate Action. The Senate deleted the bill’s new title, and instead
adopted an amendment by Mr. Kerr (D-OK) and Mr. Frear (D-DE) that amended
120 See Social Security Online: Chronology, March 31, 1960
[ h t t p : / / www.ssa.gov/ h i s t o r y/ 1960.ht ml ]
121 Congressional Record. June 22, 1960. House. In floor remarks by Mr. Thompson. p.
122 Congressional Record. June 22, 1960. House. In floor remarks by Mr. Thompson. p.
123 Congressional Record. June 23, 1960. House. Roll call no. 143, not voting 24. p.
Title I of the Social Security Act to provide medical services for medically needy
aged persons.
a.On August 20, 1960, Mr. Javits (R-NY) offered an amendment to provide
federal matching grants to states to enable them to give health care to needy
persons aged 65 or older. (This proposal was more generous than the provisions
— also based on the public assistance, i.e., charity approach — already in the
report by the Finance Committee.) On August 23, 1960, Mr. Javits’ amendment
was rejected by a vote of 28 (28-R) to 67 (5-R, 62-D).124
b.Also on August 20, 1960, Mr. Anderson (D-NM) offered an amendment to use
Social Security as well as the public assistance program for the aged to provide
health care to the elderly. On August 23, 1960, Mr. Anderson’s amendment
was rejected by a vote of 44 (l-R, 43-D) to 51 (32-R, 19-D).125
c.On August 23, 1960, the Senate passed by voice vote Mr. Byrd’s (D-WV)
amendment to permit men to retire at age 62 with actuarially reduced benefits.
(The amendment was later dropped in conference.)126
d.The Senate passed H.R. 12580 on August 23, 1960, by a vote of 91 (31-R, 60-
D) to 2 (l-R, 1-D).127
3. Conference Action. The conferees agreed to the medical care provisions
in the Senate-passed bill (i.e., no new title for a program for aged persons not eligible
for OAA benefits). The medical provisions became known as the Kerr-Mills
program, named for Senator Robert Kerr (D-OK) and House Ways and Means
Committee Chairman Wilbur Mills (D-AR).
a.The House agreed to the conference report on August 26, 1960, by a vote of 369128
(132-R, 237-D) to 17 (8-R, 9-D).
b.The Senate agreed to the conference report on August 29, 1960, by a vote of 74129
(31-R, 43-D) to 11 (l-R, 10-D).
K. P.L. 87-64, Social Security Amendments of 1961
H.R. 6027, the Social Security Amendments of 1961, was signed into law on
June 30, 1961, by President Kennedy. In general, the amendments made many of the
changes in the Social Security program recommended by President Kennedy in his
124 Congressional Record. August 23, 1960. Senate. Roll call no. 305, not voting 5. p.
125 Congressional Record. August 23, 1960. Senate. Roll call no. 307, not voting 5. p.
126 Congressional Record. August 23, 1960. Senate. p. 17234.
127 Congressional Record. August 23, 1960. Senate. Roll call no. 309, not voting 7. p.
128 Congressional Record. August 26, 1960. House. Roll call no. 197, not voting 44. p.
129 Congressional Record. August 29, 1960. Senate. Roll call no. 314, not voting 15. p.
February 2, 1961, message to Congress, in which he outlined a program to restore
momentum to the national economy.130 The amendments raised the minimum benefit
to $40 per month; permitted men to retire at age 62, instead of 65, with actuarially
reduced benefits; liberalized the insured status requirement so that, subject to the 6-
quarter minimum and the 40-quarter maximum, an individual was fully insured if he
had one quarter of coverage for every calendar year that elapsed between January 1,
or reached retirement age; increased benefits to a surviving aged widow, widower,
or dependent parent of an insured deceased worker from 75 to 82.5% of the benefit
the worker would have been entitled to if alive; changed the earnings test so that an
aged recipient had no benefits withheld for the first $1,200 a year of earnings, $1
withheld for each $2 earned between $1,200 and $1,700, and a dollar-for-dollar
reduction of earnings above $1,700; and raised the employer and employee tax rates
by 0.125% and the self-employed tax rate by 0.1875%.131
1. House Action. In the House, the principal point of dissension was the
provision in H.R. 6027 that lowered the eligibility age for men from 65 to 62.
Several Republicans opposed the provision on the basis that it would likely start a
trend toward “compulsory retirement” at age 62. Speaking for himself and most of
the minority Committee members, Mr. Curtis (R-MO) stated, “The reason [we are]
against the age 62 [provision] is this: our older people are having a hard enough time
now to stay in the labor market. This provides further incentive to drive them out.”132
a.On April 20, 1961, Mr. Curtis made a motion to recommit H.R. 6027133 and
substitute a measure that cut out the provisions for lowering the first eligibility
age for men, increased benefits for widows, and raised the minimum benefit134
from $33 to $40. The motion was rejected by voice vote. Note that the
provisions raising the minimum benefit and increasing benefits for widows were
already in H.R. 6027 as reported out of Committee.
b.The House passed H.R. 6027 on April 20, 1961, by a vote of 400 (149-R, 251-135
D) to 14 (14-R).
amendment made on June 26, 1961 to increase the earnings test limit to $1,800 a
year.136 Mr. Kerr (D-OK) said that Mr. Cotton’s amendment failed to provide
increased OASDI taxes to pay for the additional $427-$615 million that would be
130 Social Security Administration. “Social Security Amendments of 1961: Summary and
Legislative History” [by] Wilbur J. Cohen and William L. Mitchell. Social Security
Bulletin, v. 24, no. 9, September 1961. p. 8.
131 Congress and the Nation: 1945-1964. p. 1255.
132 Congressional Record. April 20, 1961. House. In floor remarks by Mr. Curtis. p. 6471.
133 Congressional Record. April 20, 1961. House. p. 6492.
134 Congressional Record. April 20, 1961. House. p. 6495.
135 Congressional Record. April 20, 1961. House. Roll call no. 40, not voting 17. p. 6495.
136 Congressional Record. June 26, 1961. Senate. p. 11309.
paid out each year under the proposed amendment.137 Mr. Kerr stated that “an
amendment which would result in the impairment of the fiscal integrity of the fund
should not be pressed.”138
a.Mr. Hartke (D-IN) offered a substitute amendment that provided a slightly less
generous new earnings test limit ($1,700). The substitute amendment was
passed June 26, 1961, by a vote of 59 (3-R, 56-D) to 30 (30-R).139 Provisions
to finance this change were agreed to by unanimous-consent.140
b.On June 26, 1961, Mr. Hartke’s amendment to broaden the definition of
disability was rejected by voice vote.141
c.The Senate passed H.R. 6027 90 (33-R, 57-D) to 0 on June 26, 1961.142
3. Conference Action. Both chambers cleared the conference report by
voice votes June 29, 1961.143
L. Proposed Social Security Amendments of 1964
H.R. 11865, the proposed Social Security Amendments of 1964, was passed by
both the House and the Senate but the Conference Committee could not reach
agreement, adjourning on October 3, 1964 without making any recommendations.
The proposed Social Security Amendments of 1964 as passed by the House
contained a 5% across-the-board Social Security benefit increase; extended the
child’s benefit to age 22 if he or she were in school; allowed widows to retire at age
60, with actuarially reduced benefits; provided limited benefits to persons aged 72
and over who had some Social Security coverage but not enough to meet the
minimum requirements of existing law; and extended Social Security coverage to
groups of persons who previously had been excluded. The House-passed bill
contained no provision relating to hospital insurance for the aged.
The proposed Social Security Amendments of 1964 as passed by the Senate
contained a hospital insurance program, the so-called King-Anderson bill; increased
benefits: raised the earnings base; liberalized the earnings test; changed the eligibility
requirements for the blind; and permitted religious groups to reject Social Security
coverage if they had religious objections to social insurance).
137 Congressional Record. June 26, 1961. Senate. p. 11314.
138 Congressional Record. June 26, 1961. Senate. In floor remarks by Mr. Kerr. p. 11310.
139 Congressional Record. June 26, 1961. Senate. Roll call no. 83, not voting 11. p. 11318.
140 Congressional Record. June 26, 1961. Senate. p. 11325.
141 Congressional Record. June 26, 1961. Senate. p. 11327.
142 Congressional Record. June 26, 1961. Senate. Roll call no. 85, not voting 10. p. 11328.
143 Congressional Record. June 29, 1961. House. p. 11791. And, Congressional Record.
June 29, 1961. Senate. p. 11693.
1. House Action. H.R. 11865, the proposed Social Security Amendments
of 1964, was reported out of the Ways and Means Committee on July 7, 1964. The
bill was debated under a rule that permitted only Committee amendments. No
amendments were offered.
a.On July 29, 1964, the House passed H.R. 11865 by a vote of 388 to 8.144
2. Senate Action. The Finance Committee approved H.R. 11865 on August
21, 1964. The Committee rejected several amendments that would have created a
hospital insurance program for the aged through the Social Security program.
a.On August 31, 1964, Mr. Gore (D-TN) offered an amendment to Mr. Long’s
(D-LA) amendment145 to increase the proposed across-the-board benefit increase
to 7% (instead of the proposed 5% increase) and liberalized the earnings test.146
Mr. Gore’s amendment included the 1963 King (D-CA)-Anderson (D-NM) bill
(H.R. 3920/S. 880), that would have provided hospital insurance benefits for the
aged under the Social Security program.
b.On September 2, 1964, the Gore amendment passed by a vote of 49 to 44.147
c.On September 3, 1964, the Senate passed H.R. 11865 by a vote of 60 to 28.148
3. Conference Action. The Conference Committee on H.R. 11865 could
not reach agreement. The conferees from the Senate voted 4 to 3 to insist on
including the hospital insurance provisions; the conferees from the House, by a 3 to
2 vote, refused to accept such provisions.149 The Conference Committee adjourned
on October 2, 1964.
M. P.L. 89-97, Social Security Amendments of 1965
H.R. 6675, the Social Security Amendments of 1965, was signed into law on
July 30, 1965, by President Johnson. Although a federally operated health insurance
program covering the entire nation was considered by the Roosevelt Administration
in 1935, it was not explicitly endorsed until January 1945, when President
Roosevelt’s budget message called for an “extended Social Security including
medical care.” Such a plan was submitted to Congress by President Truman in
November 1945, but neither chamber acted on the proposal, in large part due to
strong opposition by the AMA. The controversy surrounding the establishment of
a federal health insurance program for the aged was finally ended by the 1965
144 Congressional Record. July 29, 1964. House. Roll call no.193, not voting 35. p. 17298-
145 Congressional Record. August 31, 1964. Senate. p. 21103.
146 Congressional Record. August 31, 1964. Senate. p. 21086.
147 Congressional Record. September 2, 1964. Senate. Roll call no. 558, not voting 7. p.
148 Congressional Record. September 3, 1964. Senate. Roll call no. 561, not voting 12. p.
149 Social Security Administration. “Social Security Legislation.” Commissioner’s Bulletin,
no. 17, October 3, 1964.
amendments (H.R. 6675),150 which established a basic two-part health insurance
program called Medicare (Title XVIII of the Social Security Act). The costs of
hospitalization and related care would be met in part by a compulsory program of
Hospital Insurance (HI, part A), financed by a separate payroll tax. The program
would serve recipients of the Social Security and railroad retirement programs, age
would help pay doctor bills and related services, for all persons age 65 and older,
financed through monthly premiums paid by the recipient and a matching federal
payment from general revenues.
The amendments also provided a 7% across-the-board increase in OASDI
benefits, extended compulsory self-employment coverage to doctors, made child’s
benefits available through age 21 if the child attended school full time (under prior
law, they were available only through age 17), permitted widows to receive
actuarially reduced benefits at age 60 rather than age 62, provided benefits to
divorced wives and widows under certain conditions, increased the earnings test
amount to $1,500 with $1 withheld for every $2 earned up to $2,700, and provided
that an insured worker would be eligible for disability benefits if his or her disability
was expected to end in death or to last for 12 consecutive months, instead of
indefinitely. The 1965 amendments also increased the payroll tax rate and the
taxable wage base. In addition, P.L. 89-97 reduced the number of quarters of work
necessary for persons age 72 or over to have insured status (from 6 quarters to 3
quarters for a worker and from 6 quarters to 3 quarters for a wife who reached age
72 in or before 1966, to 4 quarters for a wife who turned 72 in 1967, and to 5 quarters
for a wife who attained age 72 in 1968).
Further, a new federal-state medical assistance program established under Title
XIX of the Social Security Act replaced the Kerr-Mills law (medica1 assistance for
the aged that was enacted in 1960). The program was to be administered by the
states, with federal matching funds. The new Medicaid program was available to all
people receiving assistance under the public assistance titles (Title I, Title IV, Title
X, and Title XIV) and to people who were able to provide for their own maintenance
but whose income and resources were insufficient to meet their medical costs.
1. House Action. A federal hospital insurance program, or “Medicare,” had
been passed only once by the Senate, in 1964, and then by a narrow margin. It had
never been approved by the Ways and Means Committee and thus had not been put
to a House vote. The 1964 congressional elections, however, brought 42 new151
Northern Democrats into the House, almost all of them Medicare supporters.
The Ways and Means Committee began holding executive sessions on H.R. 1,
a bill to establish a social insurance program for hospital and related care for the
aged, on January 27, 1965. The Committee reported H.R. 6675 March 29, 1965,
with all 17 Democrats favoring the bill and all 8 Republicans opposing it.
150 President Johnson flew to Independence, Missouri, to sign H.R. 6675 in the presence of
Harry S. Truman, the first President to propose a national health insurance program.
151 Congressional Quarterly Almanac: 1965. Washington, Congressional Quarterly, Inc.
p. 236.
House floor debate centered on the Medicare proposal. Supporters said it was
long overdue. Critics opposed its compulsory nature, argued that it would be
financed by a “regressive” payroll tax, and said it would endanger the Social Security
cash benefit program. Republican spokesmen instead wanted a voluntary health plan
(as opposed to a mandatory social insurance approach) with a Medicaid-like program
underpinning it to provide medical assistance for the needy aged.
a.On April 8, 1965, the House rejected Mr. Byrnes’ (R-WI) motion to recommit
H.R. 6675 to the Ways and Means Committee with instructions to substitute the
text of H.R. 7057, a bill that Mr. Byrnes had introduced a week earlier. H.R.
7057 was not offered as an amendment because the rule did not permit such
action. H.R. 7057 provided for all hospitalization, nursing home, medical and
surgical care to be financed through a voluntary system with payment split
between the patient and general revenues, rather than from a tax on the payrolls
of employers. The motion to recommit was rejected by a vote of 191 (128-R,
b.On April 8, 1965, the House passed H.R. 6675 by a vote of 313 (65-R, 248-D)
to 115 (73-R, 42-D).153
2. Senate Action. On June 30, 1965, the Finance Committee reported its
version of H.R. 6675. The Committee approved the bill by a vote of 12 (2-R, 10-D)
to 5 (4-R, 1-D).
a.On July 7 and 8, 1965, three moves to expand H.R. 6675 were rejected. Mr.
Ribicoff’s (D-CT) amendment to remove all time limits on length of hospital
stays under Medicare was rejected by a vote of 39 (13-R, 26-D) to 43 (12-R, 31-154
D). Mr. Miller’s (R-IA) amendment to provide for an automatic 3% increase
in Social Security pensions whenever a 3% increase occurred in the “retail”155
price index was rejected by a vote of 21 (15-R, 6-D) to 64 (9-R, 55-D). Mr.
Prouty’s (R-VT) amendment to provide benefit increases ranging from 75% in
the low-income brackets to 7% in the upper-income brackets was rejected by a
vote of 12 (10-R, 2-D) to 79 (18-R, 61-D).156 In addition, Mr. Curtis’ (R-NE)
amendment to provide that the Medicare patient pay a deductible based on
ability to pay was rejected by a vote of 41 (25-R, 16-D) to 51 (4-R, 47-D).157
b.On July 7, 1965, Mr. Byrd’s (D-WV) amendment to lower the age at which
workers could receive Social Security benefits to 60 (rather than age 62, the158
existing minimum) was agreed to by voice vote.
152 Congressional Record. April 8, 1965. House. Roll call no. 70, not voting 5. p. 7443-
153 Congressional Record. April 8, 1965. House. Roll call no. 71, not voting 5. p. 7444.
154 Congressional Record. July 7, 1965. Senate. Roll call no. 165, not voting 18. p. 15835.
155 Congressional Record. July 8, 1965. Senate. Roll call no. 166, not voting 15. p. 15869.
156 Congressional Record. July 8, 1965. Senate. Roll call no. 167, not voting 9. p. 15909.
157 Congressional Record. July 8, 1965. Senate. Roll call no. 168, not voting 8. p. 15927.
158 Congressional Record. July 7, 1965. Senate. p. 15794.
c.On July 8, 1965, Mr. Kennedy’s (D-NY) amendment to prohibit federal
payments to any hospital not meeting the standards required by the state or local
government was passed by voice vote.159
d.On July 9, 1965, Mr. Hartke’s (D-IN) amendment to liberalize the definition of
blindness under the Social Security program, provide benefits to blind workers
with at least 6 quarters of Social Security coverage, and permit blind workers
to receive benefits regardless of other earnings was passed by a vote of 78 (28-
R, 50-D) to 11 (11-D).160
e.On July 9, 1965, Mr. Hartke’s amendment to eliminate the time limit on
hospital care under the proposed program was agreed to by voice vote.161
f.On July 9, 1965, Mr. Smathers’ (D-FL) amendment to raise payroll taxes to
finance the benefits provided in floor amendments passed by a voice vote.162
g.On July 9, 1965, Mr. Curtis (R-NE) offered an amendment to strike Medicare,
parts A and B, from the bill. The amendment was rejected by a vote of 26 (18-
R, 8-D) to 64 (11-R, 53-D).163 Mr. Curtis also reintroduced, in a slightly
different form, his amendment to provide a deductible based on the Medicare
patient’s ability to pay. This amendment, too, was rejected by a vote of 40 to
52.164 In addition, Mr. Curtis moved to recommit H.R. 6675 with instructions
to strike out the portions related to Medicare and substitute a plan patterned
after the health insurance program used by retired federal employees, but
financed from current premiums. The motion to recommit H.R. 6675 was
rejected by a vote of 26 (18-R, 8-D) to 63 (10-R, 53-D).165
h.H.R. 6675 was passed by the Senate on July 9, 1965, by a vote of 68 (13-R, 55-
D) to 21 (14-R, 7-D).166
a.On July 27, 1965, the House adopted the conference report by a vote of 307 (70-
R, 237-D) to 116 (68-R, 48-D).167
b.On July 28, 1965, the Senate adopted the conference report by a vote of 70 (13-
R, 57-D) to 24 (17-R, 7-D).168
159 Congressional Record. July 8, 1965. Senate. p. 15904.
160 Congressional Record. July 9, 1965. Senate. p. 16115.
161 Congressional Record. July 9, 1965. Senate. p. 16130.
162 Congressional Record. July 9, 1965. Senate. p. 16138.
163 Congressional Record. July 9, 1965. Senate. Roll call no. 170, not voting 10. p. 16100.
164 Congressional Record. July 9, 1965. Senate. Roll call no. 174, not voting 8. p. 16119.
165 Congressional Record. July 9, 1965. Senate. Roll call no. 175, not voting 11. p. 16126.
166 Congressional Record. July 9, 1965. Senate. Roll call no. 176, not voting 11. p. 16157.
167 Congressional Record. July 27, 1965. House. Roll call no. 203, not voting 11. p.
168 Congressional Record. July 28, 1965. Senate. Roll call no.201, not voting 6. p. 18514.
N. P.L. 89-368, Tax Adjustment Act of 1966
H.R. 12752, signed by President Johnson on March 15, 1966, raised income
taxes to help pay for the Vietnam War. In addition, it extended OASI benefits of $35
per month to persons over age 71who were not covered, but with the benefit reduced
by the amount of payments received under government pension plans, veteran’s or
civil service pensions, teacher’s retirement pension plans, or welfare programs.
a.The House passed H.R. 12752, the Tax Adjustment Act of 1966, by a vote of
did not contain any Social Security provisions.
VT) offered an amendment to extend a minimum Social Security payment of $44 a
month to all persons age 70 or older who were not then eligible for benefits (an170
estimated 1.8 million persons at a cost of $760 million in FY1967).
a.On March 8, 1966, Mr. Long (D-LA) moved to table the Prouty amendment but
his motion was rejected by a vote of 37 (l-R, 36-D) to 51 (30-R, 21-D).171
b.On March 8, 1966, the Senate passed the Prouty amendment by a vote of 45
(21-R, 24-D) to 40 (9-R, 31-D);172 and adopted by a vote of 44 (25-R, 19-D) to
43 (6-R, 37-D) a motion by Mr. Prouty to table Mr. Mansfield’s (D-MT) motion
to reconsider the vote on passage of the amendment.173
c.On March 9, 1966, the Senate passed the Tax Adjustment Act of 1966 by a vote
of 79 (24-R, 55-D) to 9 (4-R, 5-D).174
3. Conference Action. On March 10, 1966, the conferees included the
Prouty amendment in the final version of H.R. 12752, but changed the monthly
benefit to $35.
a.On March 15, 1966, the House adopted the conference report on H.R. 12752 by175
a vote of 288 (68-R, 220-D) to 102 (59-R, 43-D).
169 Congressional Record. February 23, 1966. House. Roll call no. 20, not voting 41. p.
170 Congressional Record. March 8, 1966. Senate. In floor remarks by Mr. Prouty. p.
171 Congressional Record. March 8, 1966. Senate. Roll call no. 46, not voting 12. p. 5298.
172 Congressional Record. March 8, 1966. Senate. Roll call no. 47, not voting 15. p. 5298.
173 Congressional Record. March 8, 1966. Senate. Roll call no. 48, not voting 13. p. 5301.
174 Congressional Record. March 9, 1966. Senate. Roll call no. 52, not voting 12. p. 5485.
175 Congressional Record. March 15, 1966. House. Roll call no. 36, not voting 41. p.
b.On March 15, 1966, the Senate adopted the conference report on H.R. 12752 by
a vote of 72 (23-R, 49-D) to 5 (4-R, I-D).176
O. P.L. 90-248, Social Security Amendments of 1967 (H.R.
H.R. 12080, the Social Security Amendments of 1967, was signed by President
Johnson on January 2, 1968. The amendments provided a 13% across-the-board
increase in benefits; raised the taxable wage base from $6,600 to $7,800; increased
the payroll tax rate from 4.4% on employers and employees to 4.8% in 1969; raised
the minimum benefit from $44 to $55 per month; raised the earnings test limit to
$1,680 a year instead of $1,500 (recipient lost $1 for every $2 earned between $1,680
and $2,880, and lost dollar-for-dollar for earnings above $2,880); added benefits for
disabled widows and widowers at age 50, with a stricter definition of disability;
liberalized the definition of blindness for disability payments; and clarified the
definition of disability.
President Johnson had called for a 15% across-the-board increase in OASDI
benefits and numerous other changes in the Social Security Act. The proposals were
embodied in H.R. 5710, introduced in the House on February 20, 1967, by the
Committee on Ways and Means Chairman, Wilbur Mills (D-AR).
1. House Action. The Ways and Means Committee held hearings on the
Administration’s bill (H.R. 5710) in March and April, 1967. On August 7, 1967, it
reported a new bill, H.R. 12080, that included most of the Administration’s Social
Security proposals, notably a provision that raised the earnings test limit from $1,500
to $1,680.177
a.On August 17, 1967, Mr. Utt (R-CA) moved to recommit H.R. 12080. Mr.
Utt’s motion was rejected by voice vote.178
b.On August 17, 1967, the House passed H.R. 12080 by a roll call vote of 416
(182-R, 234-D) to 3 (l-R, 2-D).179 The bill was debated under a closed rule
prohibiting floor amendments.
2. Senate Action. On November 14, 1967, the Senate Finance Committee
reported a heavily-amended bill that contained several of the OASDI provisions as
they had been recommended by the Administration rather than as they had been
modified by the House. The Senate bill provided a 15% across-the-board Social
Security increase, in contrast to the 12.5% increase in the House bill.
176 Congressional Record. March 15, 1966. Senate. Roll call no. 57, not voting 23. p.
177 Social Security Administration. “Social Security Amendments of 1967: Summary-and
Legislative History” [by] Wilbur J. Cohen and Robert M. Ball. Social Security Bulletin, v.
178 Congressional Record. August 17, 1967. House. p. 23132.
179 Congressional Record. August 17, 1967. House. Roll call no. 222, not voting 3. p.
a.On November 17, 1967, Mr. Prouty (R-VT) offered an amendment to finance
the higher benefits out of general revenues rather than Social Security taxes.
The amendment was rejected by a vote of 6 (3-R, 3-D) to 62 (23-R, 39-D).180
b.On November 17, 1967, Mr. Metcalf (D-MT) offered an amendment to delete
from H.R. 12080 a more stringent definition of disability. The Metcalf
amendment was passed by a vote of 34 (6-R, 28-D) to 20 (16-R, 4-D).181
c.On November 21, 1967, Mr. Williams (R-DE) offered an amendment to
implement the Finance Committee’s recommended payroll tax increase in
January 1968 (before the general election) rather than in January 1969. The
amendment was defeated by a vote of 27 (22-R, 5-D) to 49 (4-R, 45-D).182
d.On November 21, 1967, the Senate, by a vote of 22 (17-R, 5-D) to 58 (9-R, 49-
D), rejected a Republican proposal offered by Mr. Curtis (R-NE) and Mr.
Williams (R-DE) substituting the 12.5% OASDI benefit increase and financing
plan contained in the House bill for the 15% benefit increase and financing plan
recommended by the Finance Committee.183
e.On November 21, 1967, Mr. Bayh (D-IN) offered an amendment to raise the
earnings test limit from $1,680 to $2,400. Mr. Bayh’s amendment passed by a
vote of 50 (14-R, 36-D) to 23 (10-R, 13-D).184
f.The Senate passed H.R. 12080 on November 22, 1967, by a 78 (23 R, 55-D) to
3. Conference Action. The conference Report on H.R. 12080 was filed on
December 11, 1967. All of the major Senate floor amendments were dropped from
the bill. The conferees split the difference between many of the other provisions.
a.The House adopted the conference report on December 13, 1967, by a vote of186
b.The Senate adopted the conference report on December 15, 1967, by a vote of187
180 Congressional Record. November 17, 1967. Senate. Roll call no. 327, not voting 32.
p. 33078.
181 Congressional Record. November 17, 1967. Senate. Roll call no. 329, not voting 46.
p. 33119.
182 Congressional Record. November 21, 1967. Senate. Roll call no. 335, not voting 24.
p. 33496.
183 Congressional Record. November 21, 1967. Senate. Roll call no. 337, not voting 20.
p. 33510.
184 Congressional Record. November 21, 1967. Senate. Roll call no. 349, not voting 27.
p. 33587.
185 Congressional Record. November 22, 1967. Senate. Roll call no. 350, not voting 16.
p. 33637.
186 Congressional Record. December 13, 1967. House. Roll call no. 439, not voting 38.
p. 36393.
187 Congressional Record. December 15, 1967. Senate. Roll call no.392, not voting 24.
p. 36924.
P. P.L. 91-172, The Tax Reform Act of 1969
H.R. 13270, the Tax Reform Act of 1969, was signed by President Nixon on
December 30, 1969. The new law included a 15% increase in Social Security
benefits beginning in January 1, 1970.
vote of 395 (176-R, 219-D) to 30 (10-R, 20-D). The bill did not contain any Social
Security provisions.
2. Senate Action. On December 5, 1969, Mr. Long (D-LA) offered an
amendment to raise basic Social Security benefits by 15% beginning in January 1970.
a.Mr. Long’s amendment was passed by a vote of 73 (23-R, 50-D) to 14 (14-R).189
b.A Byrd (D-WV)-Mansfield (D-MT) amendment to increase the minimum
benefit to $100 for single persons and to $150 for couples and to increase the
taxable wage base from $7,800 to $12,000 beginning in 1973 was passed190
December 5, 1969, by a vote of 48 (8-R, 40-D) to 41 (28-R, 13-D).
c.On December 5, 1969, Mr. Williams (R-DE) offered a substitute amendment
to provide a 10%, rather than a 15%, benefit increase. The substitute
amendment was rejected by a vote of 34 (33-R, 1-D) to 56 (5-R, 51-D).191
d.On December 11, 1969, the Senate passed H.R. 13270 by a vote of 69 (18-R,
3. Conference Action. The conferees agreed to increase Social Security
benefits by 15%, effective January 1, 1970. The House had not included the increase
in H.R. 13270 but had approved an identical provision in another bill, H.R. 15095.
The conferees dropped the other provisions that were added on the Senate floor.
a.On December 22, 1969, the House adopted the conference report on the Tax193
Reform Act, H.R. 13270, by a vote of 381 (169-R, 212-D) to 2 (2-R).
188 Congressional Record. August 7, 1969. House. Roll call No. 149, not voting 7. p.
189 Congressional Record. December 5, 1969. Senate. Roll call no. 179, not voting 13. p.
190 Congressional Record. December 5, 1969. Senate. Roll call no. 177, not voting 10. p.
191 Congressional Record. December 5, 1969. Senate. Roll call no. 175, not voting 9. p.
192 Congressional Record. December 11, 1969. Senate. Roll call no. 223, not voting 6. p.
193 Congressional Record. December 22.1969. House. Roll call no. 351, not voting 50. p.
b.On December 22, 1969, the Senate adopted H.R. 13270 by a vote of 71 (25-R,
Q. P. L. 92-5, Public Debt Limit Increase; Social Security
Amendments
President Nixon signed H.R. 4690 on March 17, 1971. It provided a 10%
across-the-board increase in OASDI benefits, retroactive to January 1, 1971; raised
the minimum benefit from $64 to $70.40 per month; increased the taxable wage base
from $7,800 to $9,000 effective January 1, 1972; increased the OASDI tax rates on
employers and employees to 5.15% each beginning in 1976 (from 5% scheduled to
take effect in 1973 under prior law); and provided a 5% increase in special benefits
payable to individuals age 72 and older who were not insured for regular benefits,
retroactive to January 1, 1971.
H.R. 17550 increased benefits by 5%, provided for automatic benefit increases with
rises in the cost of living, and made other changes in the OASDI and Medicare
programs.
2. Senate Action. In the Senate, H.R. 17550 became a conglomerate bill
containing import quotas and welfare provisions as well. On December 29, 1970, the
Senate separated Social Security changes from the rest of the bill. H.R. 17550, with
provisions raising benefits 10%, providing a $100 minimum benefit, raising the
taxable wage base from $7,800 to $9,000, and making changes in the Medicare and
Medicaid programs, was passed by the Senate on December 29, 1970, by a vote of
Mr. Long (D-LA), Chairman of the Finance Committee and floor manager of
H.R. 4690, said that he had asked the House to take immediate action to raise Social
Security benefits and as the House had not responded, he was offering a benefit198
increase as an amendment to H.R. 4690, a bill to increase the debt ceiling.
194 Congressional Record. December 22, 1969. Senate. Roll call no. 273, not voting 23.
p. 40718.
195 Congressional Record. May 21, 1970. House. Roll call no. 136, not voting 53. p.
196 Congressional Record. December 29, 1970. Senate. Roll call no. 455, not voting 19.
p. 43868.
197 Congressional Quarterly Almanac; 1971. p. 421-425.
198 Congressional Record. March 12, 1971. Senate. p. 6374.
a.On March 12, 1971, Mr. Long’s amendment to provide a 10% increase in Social
Security payments, a $100 minimum benefit, increases in earnings limitations,
and other changes passed by a vote of 82 (38-R, 44-D) to 0.199
b.The Senate, on March 12, 1971, passed H.R. 4690, after approving several
Social Security changes, including the benefit increase proposed by Mr. Long,
by a vote of 80 (37-R, 43-D) to 0.200
3. Conference Action. Conferees accepted the Senate’s 10% benefit
increase but reduced the $100 minimum benefit to $70.40 and made several other
modifications.
a.On March 16, 1971, the House adopted the conference report by a vote of 360201
(150-R, 210-D) to 3 (3-R).
b.On March 16, 1971, the Senate adopted the report by a vote of 76 (37-R, 39-D)202
to 0.
R. P.L. 92-336, Public Debt Limit; Disaster losses; Social
Security Act Amendments
President Nixon signed H.R. 15390, a bill to extend the limit on the public debt,
on July 1, 1972. At the beginning of the year, the President included a number of
Social Security proposals, along with a controversial welfare reform plan, in H.R. 1.
Congress at midyear used a more promising vehicle to pass a separate 20% increase
in Social Security benefits. The increase was added in the Senate to a House-passed
bill that raised the debt limit (H.R. 15390). The bill also provided for future
automatic increases in Social Security benefits when the consumer price index (CPI)
rose by 3% or more. To finance the increase, the taxable wage base was raised from
$9,000 to $10,800 in 1973 and to $12,000 in 1974, with automatic adjustment
thereafter. The Congressional Quarterly Almanac reported that:
Backers of the Social Security benefits package decided to attach it to the
debt increase bill for two reasons: (1) President Nixon, who opposed a
20% increase as inflationary, would be unlikely to veto a bill that
contained a debt limit increase, and (2) H.R. 1, the bill under which a
benefit increase was then being considered, faced an uncertain future
because of controversy over its welfare provisions.203
199 Congressional Record. March 12, 1971. Senate. Roll call no. 20, not voting 18. p.
200 Congressional Record. March 12, 1971. Senate. Roll call no. 23, not voting 20. p.
201 Congressional Record. March 16, 1971. House. Roll call no. 20, not voting 68. p.
202 Congressional Record. March 16, 1971. Senate. Roll call no. 24, not voting 24. p.
203 Congressional Quarterly Almanac: 1972. p. 399.
a.On June 22, 1971, the House had passed H.R. 1 (See P.L. 92-603, below) which
included provision for a general benefit increase of 5%.
b.On February 23, 1972, Mr. Mills (D-AR), Chairman of the Ways and Means
Committee, introduced H.R. 13320, which provided for an immediate benefit
increase of 20%.204
c.On June 27, 1972, the House passed H.R. 15390, providing only for an increase
in the debt ceiling, by a vote of 211 to 168.205
a.On June 29, 1972, Mr. Aiken (R-VT) offered an amendment to the Church
amendment [See (c) below] to increase Social Security benefits by 30%.
Following Mr. Long’s (D-LA) motion, Mr. Aiken’s amendment was tabled by
a vote of 71 (3l-R, 40-D) to 18 (8-R, 10-D).206
b.On June 30, 1972, an amendment by Mr. Bennett (R-UT) to increase Social
Security benefits by 10% instead of 20% was rejected by the Senate by a vote
of 20 (17-R, 3-D) to 66 (21-R, 45-D).207
c.On June 30, 1972, Mr. Church’s (D-ID) amendment calling for a 20% benefit
increase and the automatic adjustment of benefits and the taxable wage base in
the future was adopted by the Senate by a vote of 82 (34-R, 48-D) to 4 (4-R).208
The amendment made benefit increases automatic whenever the consumer price
index rose more than 3% in any calendar year.
d.On June 30, 1972, the Senate passed H.R. 15390 by a vote of 78 (36-R, 42-D)
to 3 (l-R, 2-D). H.R. 15390 was then sent back to the House.209
3. House Response to Senate Amendment. The House sent the debt
ceiling bill to the conference committee on June 30, 1972 without accepting the
Senate-passed benefit increase. Immediate congressional action was necessary
because the debt limit was to revert automatically to $400 billion (from the existing
$450 billion) at midnight on June 30, 1972.
4. Conference Action. On June 30, 1972, the conferees informally accepted
the Senate-passed version of H.R. 15390. Under House rules, however, House
204 Congressional Record. February 23, 1972. House. p. 5269-5270.
205 Congressional Record. June 27, 1972. House. Roll call no. 237, not voting 53. p.
206 Congressional Record. June 29, 1972. Senate. Roll call no. 266, not voting 11. p.
207 Congressional Record. June 30, 1972. Senate. Roll call no. 267, not voting 13. p.
208 Congressional Record. June 30, 1972. Senate. Roll call no. 268, not voting 13. p.
209 Congressional Record. June 30, 1972. Senate. Roll call no. 272, not voting 19. p.
conferees could not agree to non-germane amendments added by the Senate. Thus,
the conference report was reported back to the House in disagreement.210
a.On June 30, 1972, Mr. Byrnes (R-WI) called the proposed 20% increase
“irresponsible” and moved that the House concur with the Senate amendment
but with the benefit increase limited to 10%. Mr. Byrnes’ motion was rejected
by a vote of 83 (63-R, 20-D) to 253 (73-R, 180-D).211
b.On June 30, 1972, Mr. Mills’ (D-AR) motion that the House concur with the
Senate-passed amendment granting a 20% Social Security benefit increase and
annual automatic cost-of-living adjustments (COLAs) was accepted by a vote
of 302 (108-R, 194-D) to 35 (28-R, 7-D).212
S. P.L. 92-603, Social Security Amendments of 1972
H.R. 1, the Social Security Amendments of 1972, was signed into law on
October 30, 1972, by President Nixon. During 1969-72, Congress raised OASDI
benefits 3 times. In 1969, benefits were raised by 15%; in 1971, by 10%, and by 20%
in 1972 (P.L. 92-336). P.L.92-336 also provided for future automatic benefit
increases, called cost of living adjustments (COLAs), starting in January 1975,
whenever the consumer price index rose more than 3% in a year. These benefit
increases were amendments to bills dealing with other subjects. President Nixon had
requested a number of other Social Security liberalizations in 1969, but those
proposals were entangled with his controversial welfare reform plan. It was not until
1972, when H.R. 1 became P.L. 92-603, that the requested Social Security
recommendations became law.213
The 1972 amendments (H.R. 1) increased benefits for widows and widowers;
raised the earnings limit from $1,680 to $2,100 with automatic adjustment to average
wages thereafter (earnings above $2,100 benefits were reduced dollar-for-dollar
without limit); reduced the waiting period for disability benefits from six to five
months; extended Medicare protection to disabled recipients who had received
benefits for at least two years; and provided a special minimum benefit of up to $170
a month for those who had worked many years, but at low earnings. In addition,
OASDHI tax rate-increases scheduled for the periods 1973-1977, 1978-1980, 1981-
1985, 1986-1992, 1993-1997, 1998-2010, and 2011 and years thereafter, were further
raised. 214
210 Congressional Quarterly Almanac: 1972. p. 402-403.
211 Congressional Record. June 30, 1972. House. Roll call no. 259, not voting 95. p.
212 Congressional Record. June 30, 1972. House. Roll call no. 260, not voting 95. p.
213 Congress and the Nation: 1969-1972. Vol. III. p. 619.
214 Under P.L. 92-336, the tax rates had been reduced over then existing scheduled increases
through 2010; rates under P.L. 92-603 advanced the tax rate schedule and raised the out-year
rates.
H.R. 1 also contained the President’s controversial Family Assistance Plan. The
bill remained in the Senate for more than a year because of controversy over welfare
reform. The Senate finally approved H.R. 1 with a provision for tests of rival welfare
plans, but in conference all family welfare provisions were dropped. In addition, the
final version of H.R. 1 contained provisions federalizing and consolidating adult
public assistance programs for needy aged, blind, and disabled persons in a new
“Supplemental Security Income” (SSI) program.
1. House Action. Most of the debate on H.R. 1 dealt with the family welfare
provisions, with little debate on the OASDI and Medicare provisions.
a.H.R. 1 was passed by the House on June 22, 1971, by a vote of 288 (112-R,215
a.On September 27, 1972, Mr. Mansfield (D-MT) offered an amendment to
increase the earnings test limit from $1,680 to $3,000. Mr. Mansfield’s216
amendment was agreed to by a vote of 76 (32-R, 44-D) to 5 (4-R, 1-D).
b.On September 28, 1972, Mr. Percy’s (R-IL) amendment to require the Secretary
of the Department of Health, Education, and Welfare to review the Social
Security earnings test, and report to Congress on the feasibility of eliminating217
it, was accepted by voice vote.
c.On September 29, 1972, Mr. Long (D-LA) offered an amendment to provide a
federal Supplemental Security Income (SSI) program for needy aged, blind, or
disabled persons (in place of the existing State adult assistance programs). The218
amendment was passed by a vote of 75 (32-R, 43-D) to 0.
dOn September 29, 1972, the Finance Committee’s amendment to guarantee
every person who worked in employment covered under the Social Security
program for at least 30 years a minimum monthly benefit of $200 ($300 for a219
couple) passed by a vote of 73 (30-R, 43-D) to 0.
e.On September 30, 1972, Mr. Byrd’s (D-WV) amendment to lower to 60 the age
at which reduced Social Security benefits could be received and to 55 the age
at which a woman could receive reduced widow’s benefits was agreed to by a220
vote of 29 (10-R, 19-D) to 25 (12-R, 13-D).
215 Congressional Record. June 22, 1971. House. Roll call no. 157, not voting 13. p.
216 Congressional Record. September 27, 1972. Senate. Roll call no. 478, not voting 19.
p. 32488.
217 Congressional Record. September 28, 1972. Senate. p. 32720.
218 Congressional Record. September 29, 1972. Senate. Roll call no. 484, not voting 25.
p. 32905.
219 Congressional Record. September 29, 1972. Senate. Roll call no. 485, not voting 27.
p. 32907.
220 Congressional Record. September 30, 1972. Senate. Roll call no. 488, not voting 46.
(continued...)
f.On September 27, 1972, Mr. Goldwater (R-AZ) offered an amendment to repeal
the earnings limitation for all Social Security recipients age 65 and over. The
amendment was rejected by voice vote.221
g.H.R. 1 passed the Senate on October 5, 1972, by a vote of 68 (33-R, 35-D) to
a.On October 17, 1972, the House adopted the conference report on H.R. 1 by a
vote of 305 (129-R, 176-D) to 1 (1-D).223
b.On October 17, 1972, the Senate adopted the conference report on H.R. 1 by a
vote of 61 (24-R, 37-D) to 0.224
T. P.L. 93-233, Social Security Benefits Increase
A two-step 11% benefit increase became law when President Nixon signed H.R.
11333 on December, 31, 1973. This increase was in lieu of a 5.9% increase
scheduled by legislation, P.L. 93-66, that had been enacted in July 1973.225 In
passing H.R. 11333, congressional sentiment was that the earlier increase was
inadequate to offset recent rapid increases in inflation.
P.L. 93-233 increased benefits by 7% in March 1974 and by another 4% in June
1974. To finance the increases, the Social Security taxable wage base was raised
from $12,600 to $13,200 in January 1974. In addition, the automatic COLA
mechanism was revised. Under P.L. 93-233, the COLA was to be based on the rise
in the CPI from the first quarter of one year to the first quarter of the next year, rather
than second quarter to second quarter, with benefit increases starting in June 1975
rather than in January. As a result, the increases would appear in checks received in
July, creating only a three-month lag from the close of the measuring period (i.e., the
first quarter) rather than the seven-month lag under the prior mechanism.
1. House Action. With a rule allowing only one floor amendment (pertaining
to SSI), the House passed H.R. 11333 on November 15, 1973.226
220 (...continued)
p. 33000.
221 Congressional Record. September 27, 1972. Senate. p. 32485.
222 Congressional Record. October 5, 1972. Senate. Roll call no. 536, not voting 27. p.
223 Congressional Record. October 17, 1972. Senate. Roll call no. 455, not voting 122. p.
224 Congressional Record. October 17, 1972. Senate. Roll call no. 567, not voting 39. p.
225 P.L. 93-66 also increased the earnings test threshold amount from $2,100 to $2,400 for
226 Congressional Record. November 15, 1973. House. Roll call no. 592, not voting 22.
(continued...)
The November 14-15 debate on H.R. 11333 was devoted to the need for a quick
cost-of-living Social Security benefit increase and to questions about the fiscal
soundness of the Social Security trust funds.227 H.R. 11333 as reported by the Ways
and Means Committee recommended a two-step 11% Social Security benefit increase
in 1974, accelerated SSI benefit increases, and payroll tax increases.
a.On November 15, 1973, the House passed H.R. 11333 by a vote of 391 (168-R,
2. Senate Action. The Senate Finance Committee approved a number of
provisions affecting Social Security, including an initial 7% benefit increase effective
upon enactment and a further 4% increase in June 1974. Rather than acting on H.R.
11333, the Senate attached its Social Security amendments to H.R. 3153, a Social
Security bill passed by the House on April 2, 1973. (H.R. 3153 made a number of
technical and conforming amendments to the Social Security Act that had been
omitted in drafting the conference agreement on H.R. 1, which became P.L. 92-603.)
The Senate debated H.R. 3153 for three days and adopted 38 amendments.
a.On November 29, 1973, Mr. Byrd (D-WV) introduced an amendment that
reduced to 55 the age at which a woman could claim a Social Security widow’s
benefit. Under existing law, a widow could elect to retire at 60 with reduced
benefits. Mr. Byrd said that his amendment would help widows between the
ages of 55 and 60, who would be unlikely and perhaps unable to establish a new
career, or to reactivate an old one. Terming the Byrd amendment “inequitable,”
Mr. Curtis (R-NE) objected that it would be unjust to reduce the eligibility age
for widows “who have not worked under covered employment” while keeping
the existing requirement at age 62 for “women who have had to work all their
lives and will have to work until they are of retirement age.” Mr. Byrd’s229
amendment was adopted by a vote of 74 (28-R, 46-D) to 13 (9-R, 4-D).
b.Mr. Byrd introduced a second amendment that increased the earnings test limit
from $2,400 to $3,000 and lowered from 72 to 70 the age at which the earnings
limit would no longer apply. The amendment was accepted November 29,230
c.On November 29, 1973, Mr. Hartke’s (D-IN) amendment making blind persons
eligible for disability benefits after working 18 months in covered employment
was adopted by voice vote. (Ordinarily a disabled person had to work in 20 out
of the last 40 quarters to be eligible.)
226 (...continued)
p. 37159.
227 Congressional Quarterly Almanac: 1973. p. 573.
228 Congressional Record. November 15, 1973. House. Roll call no. 592, not voting 22.
p. 37159.
229 Congressional Record. November 29, 1973. Senate. Roll call no. 527, not voting 13.
p. 38645.
230 Congressional Record. November 29, 1973. Senate. Roll call no. 528, not voting 15.
p. 38645-38646.
d.On November 30, 1973, the Senate passed H.R. 3153 by a vote of 66 (24-R, 42-
D) to 8 (6-R, 2-D).231
3. Conference Action. After the Senate passed H.R. 3153, it asked the
House for a conference, but the House appointed conferees with only two days before
the end of the session. The Conferees did not act on H.R. 3153. Instead, they agreed
to work on revisions to H.R. 11333, the House-passed Social Security bill, on which
the Senate had never acted.232 As part of a compromise reached on December 20, the
House conferees agreed to hold a further conference on H.R. 3153 in 1974 to
consider additional Senate amendments, but the conference never took place.
The conference report on H.R. 11333 included a two-step 11% increase in
benefits, effective March 1974 and June 1974, raised the wage base to $13,200 in
a.The Senate passed H.R. 11333 with the amendments agreed to in conference on233
December 21, 1973, by a vote of 64 to 0.
b.The House, on December 21, 1973, concurred in passing the bill by a vote of234
U. P.L. 95-216. The Social Security Amendments of 1977
H.R. 9346, the Social Security Amendments of 1977, was signed by President
Carter on December 20, 1977. H.R. 9346 was passed to meet major Social Security
financing problems that emerged in the mid-1970s. The Congressional Quarterly
Almanac says that the main cause of the immediate financial problems was the
“combination of rapid inflation and a recession, which together raised Social Security235
benefit costs and reduced tax receipts.” In addition to fixing short-run problems,
the amendments sought to eliminate the medium-range deficit (over the next 25
years) and to reduce the projected long-range deficit (next 75 years) from more than
8% of taxable payroll to less than 1.5%. The basic approach was to (1) handle the
short-term financing problem either through increased payroll taxes or infusions from
the general fund; and (2) reduce and possibly eliminate the projected long-run deficit
by modifying the benefit formula to stabilize replacement rates.
Neither House of Congress gave much attention to an Administration proposal
to authorize use of general revenues for Social Security during periods of high
231 Congressional Record. November 30, 1973. Senate. Roll call no. 540, not voting 24.
p. 38975.
232 Congressional Quarterly Almanac: 1973. p. 577-580.
233 Congressional Record. December 21,1973. Senate. Roll call no. 613, not voting 34.
p. 43115. Note: The Congressional Quarterly vote breakdown indicates 66 in favor (21-R,
234 Congressional Record. December 21, 1973. House. Roll call no. 719, not voting 118.
p. 43230.
235 Congressional Quarterly Almanac: 1977. p. 161.
unemployment (the so-called “counter cyclical” use of general revenues). Instead,
to meet the short-run problem the new law mostly increased Social Security tax rates
and the taxable earnings base and somewhat reduced expenditures. The final bill
contained “decoupling” procedures, which also had been supported by the Ford
Administration, for correcting a basic flaw in the benefit computation formula, and
thereby largely reduced the long-run problem. P.L. 95-216 also liberalized the
earnings test by providing a five-step ad hoc increase in the earnings limits for
recipients age 65 and over (the limit for persons under age 65 continued to be
adjusted only for increases in average wages after 1978); eliminated the earnings test
for recipients aged 70 and over (reduced from age 72), beginning in 1982; reduced
spousal benefits for government annuitants whose government jobs were not covered
by Social Security; and liberalized the treatment of divorced and widowed recipients.
1. House Action. Legislation that incorporated the Administration’s
recommendations (H.R. 8218) was introduced on July 12, 1977, by Mr. Burke (D-
MA), Chairman of the House Ways and Means Committee’s Social Security
Subcommittee. After reworking the Administration’s package, the Subcommittee
made recommendations to the full Committee that were introduced by Chairman
Ullman (D-OR) on September 27, 1977, as H.R. 9346. On October 6, 1977, the full
Committee approved a financing plan combining payroll tax increases with basic
changes in benefits and coverage. H.R. 9346, was reported to the House on October
a.On October 26, 1977, The House considered an amendment from the237
Committee on Post Office and Civil Service. The amendment would have
deleted the provision in the Ways and Means Committee bill covering federal,
state, local, and nonprofit employees under Social Security.
b.Mr. Fisher (D-VA) offered a substitute for the Post Office and Civil Service
Committee amendment. The Fisher substitute provided that federal employees
would continue to be exempt from the Social Security system and that state and
local governments and nonprofit organizations would continue to have the
option of electing to cover their employees. While the amendment deleted
mandatory coverage of these employees, the bill retained a provision requiring
a study of mandatory coverage to be conducted jointly by the Civil Service
236 Social Security Administration. “Social Security Amendments of 1977: Legislative
History and Summary of Provisions.” Prepared by John Snee and Mary Ross, Office of
Program Evaluation and Planning, Social Security Administration. Social Security Bulletin,
v. 41, no. 3, March 1978. p. 6-9. (Hereafter cited as “Social Security Amendments of 1977:
Legislative History.”)
237 When H.R. 9346 was introduced it was referred solely to the Ways and Means
Committee. The Chairman of the Post Office and Civil Service Committee, Mr. Nix (D-
PA), concerned over the Social Security coverage of federal employees under the bill,
persuaded the Speaker to give his Committee sequential referral of the bill. The Committee
on Post Office and Civil Service unanimously voted to amend the bill to strike Social
Security coverage of federal employees. However, under the rule for floor debates the bill
as reported by the Ways and Means Committee was to be the vehicle for floor consideration.
The Post Office and Civil Service Committee amendment was considered as a floor
amendment to the Ways and Means Committee bill.
Commission, the Departments of Treasury and Health, Education, and Welfare,
and the Office of Management and Budget. Many Members endorsed the
concept of universal mandatory Social Security coverage, but supporters of the
Fisher amendment asserted that a study of the universal coverage issue should
be conducted first. Opponents, on the other hand, argued that the Committee
bill, by postponing the extension of coverage until 1982, allowed sufficient time
to work out details.238 In order to make up for the revenue loss due to deletion
of the mandatory coverage provisions, the amendment also provided for greater
increases in the Social Security tax rate and wage base than those included in
the Committee bill. The Administration, as well as representatives of many
groups that would have been affected by the coverage extension, lobbied for the
Fisher amendment.239 Mr. Fisher’s substitute amendment was agreed to by a
vote-of 386 (129-R, 257-D) to 38 (14-R, 24-D).240 The House then adopted the
Post Office and Civil Service Committee amendment, as amended by the Fisher
amendment, by a vote of 380 (124-R, 256-D) to 39 (14-R, 25-D).241
c.On October 26, 1977, Mr. Pickle (D-TX) offered an amendment to strike
another Committee provision authorizing standby loans to the OASDI system
from general revenues whenever trust fund reserves dipped below 25% of a
year’s outgo. Mr. Pickle argued that any use of general treasury funds for Social
Security undermined the contributory nature of the program. He remarked that
he did not want to see the Social Security program turned into a “welfare or
need program.” The Pickle amendment was rejected by a vote of 196 (122-R,
d.On October 26, 1977, Mr. Corman (D-CA) offered an amendment to eliminate
the minimum Social Security benefit for new recipients. Mr. Corman said that
the minimum benefit gave those who had paid very little in Social Security
taxes a benefit “far in excess of his or her average monthly wage.” He stated
that his amendment restored “a measure of the social insurance principle of
relating benefits to contributions.” The amendment was rejected by a vote of
e.On October 27, 1977, Mr. Ketchum (R-CA) offered an amendment to raise the
earnings limitation on recipients over age 65 gradually and to phase it out
completely in 1982. The amendment included a tax rate increase to meet the
238 Congressional Quarterly Almanac: 1977. p. 165.
239 Ibid.
240 Congressional Record. October 26, 1977. House. Roll call no. 697, not voting 10. p.
241 Congressional Record. October 26, 1977. House. Roll call no. 698, not voting 15. p.
242 Congressional Record. October 26, 1977. House. Roll call no. 700, not voting 17. p.
243 Congressional Record. October 26, 1977. House. Roll call no. 701, not voting 32. p.
cost of the additional benefit payments. The amendment was adopted by a vote
of 268 (139-R, 129-D) to 149 (1-R, 148-D).244
f.On October 27, 1977, Mr. Conable (R-NY) moved to recommit H.R. 9346 to
the Ways and Means Committee with instructions to report out the bill with an
amendment that mandated coverage of federal workers, diverted half of the HI
portion of the Social Security tax to OASDI in 1980, and replaced the lost HI
revenues with general revenues. Mr. Conable argued that an amendment
containing the above would enable both the wage base and the tax rate to remain
as scheduled under existing law. The recommittal motion was rejected by a
vote of 57 (44-R, 13-D) to 363 (97-R, 266-D).245
g.H.R. 9346 passed the House on October 27, 1977, by a vote of 275 (40-R, 235-
D) to 146 (100-R, 46-D).246
2. Senate Action. Preliminary hearings and mark-up sessions on financing
and decoupling were held by the Senate Committee on Finance in the summer and
fall of 1977, even though the House had not yet passed its Social Security bill.247
Before H.R. 9346 was passed by the House, the Finance Committee had tentatively
agreed that its amendments would be attached to H.R. 5322, an unrelated tariff bill
that had originated in the House. H.R. 5322 was to be a convenient vehicle for
putting the Senate Finance Committee proposals before the Senate promptly.248
a.When H.R. 9346 as passed by the House came up for debate on the Senate floor
on November 2, 1977, Mr. Long (D-LA) introduced an amendment to substitute
the Finance Committee Social Security proposals in H.R. 5322 for the House
bill. The Finance Committee proposals included decoupling measures similar
to those in the House bill. They also included provisions that would require
employers to pay Social Security taxes on a higher wage base than employees
and would reduce spousal benefits by the amount of a government pension that
was based on work not covered by Social Security. Mr. Long’s amendment was
agreed to with no recorded vote.249 Thus, the text of H.R. 5322 became H.R.
b.On November 3, 1977, Mr. Curtis (R-NE) offered an amendment that would
have kept the taxable wage base the same for employers and employees (at the
level specified for employees in the Committee proposal) but would have raised
the tax rate above the Committee-recommended levels. Mr. Curtis said his
amendment would take care of the deficit in the Social Security fund. He stated
244 Congressional Record. October 27, 1977. House. Roll call no. 704, not voting 17. p.
245 Congressional Record. October 27, 1977. House. Roll call no. 705, not voting 14. p.
246 Congressional Record. October 27, 1977. House. Roll call no. 706, not voting 13. p.
247 “Social Security Amendments of 1977: Legislative History.” p. 9.
248 Ibid., p. 10-11.
249 Congressional Record. November 2, 1977. Senate. p. 36449.
that raising the wage base would put half of the financing burden exclusively on
the people with higher incomes.
Mr. Nelson (D-WI) acknowledged that the Curtis amendment would supply the
necessary funding to keep the retirement system solvent, but stressed that the
average worker would pay a higher tax under the Curtis plan than under the
Committee proposal. Mr. Nelson’s motion to table the Curtis amendment lost
by a vote of 44 (3-R, 41-D) to 45 (31-R, 14-D),250 but the Senate then rejected
the Curtis amendment, 40 (27-R, 13-D) to 50 (7-R, 43-D).251
c.On November 4, 1977, Mr. Goldwater (R-AZ) offered an amendment to lower
the age at which the earnings test would no longer apply from 72 to 65. Mr.
Goldwater said that his amendment would end the discrimination that allowed
full benefits to relatively wealthy retirees who had unearned income in excess
of $3,000, but reduced benefits for retirees who relied entirely on additional
earned income to supplement their Social Security benefits. Opponents of the
amendment said that it would provide a windfall to professionals who continued
to work at lucrative jobs past retirement age.
Mr. Church (D-ID offered a substitute amendment to lower from 72 to 70 the
age at which the earnings test would no longer apply. Mr. Goldwater’s motion
to table the Church amendment was rejected 33 (25-R, 8-D) to 53 (7-R, 46-
D).252 The Senate adopted the Church substitute amendment 59 (12-R, 47-D)
to 28 (20-R, 8-D)253 and then adopted the Goldwater amendment as amended by
the Church substitute by a vote of 79 (30-R, 49-D) to 4 (4-D).254
d.An amendment offered by Mr. Church on November 4, 1977 to provide for
semiannual COLAs (when the rate of inflation for a six-month period was 4%
or greater) was adopted by a vote of 50 (ll-R, 39-D) to 21 (15-R, 6-D).255
e.On November 4, 1977, Mr. Bayh (D-IN) offered an amendment to remove the
earnings limit for blind persons collecting disability benefits and to set the
250 Congressional Record. November 3, 1977. Senate. Roll call no. 611, not voting 11. p.
251 Congressional Record. November 3, 1977. Senate. Roll call no. 612, not voting 10. p.
252 Congressional Record. November 4, 1977. Senate. Roll call no. 620, not voting 14. p.
253 Congressional Record. November 4, 1977. Senate. Roll call no. 621, not voting 13. p.
254 Congressional Record. November 4, 1977. Senate. Roll call no. 622, not voting 17. p.
255 Congressional Record. November 4, 1977. Senate. Roll call no. 627, not voting 29. p.
number of quarters blind persons must work to qualify for disability benefit at
six. The Bayh amendment was adopted by voice vote.256
f.The Senate passed H.R. 9346, as amended, by a vote of 42 (9-R, 33-D) to 25
(15-R, 10-D) on November 4, 1977.257
3. Conference Action. The conference agreement provided for higher
payroll tax rates than those proposed by either the House or Senate. The House-
approved authority for loans to the trust funds from general revenues was dropped,
as was the Senate-passed proposal to raise the wage base for employers higher than
that for employees. Rather than phase out the earnings test, as in the House-passed
bill, the conferees agreed to raise, over five years, the earnings tests limit for the
elderly (65 and older).
Despite numerous differences between the House and Senate versions of the
bill, the Congressional Quarterly Almanac stated that the conferees resolved their
differences “without trouble.”258 The main controversy involved provisions dealing
with welfare programs and college tuition tax credits.
a.On December 15, 1977, the House agreed to the conference report by a vote of
189 (15-R, 174-D) to 163 (109-R, 54-D).259 There was unease in the House
because of the large tax increases. Mr. Conable (R-NY) claimed that more
reasonable non-tax alternatives were available.
b.On December 15, 1977, Mr. Ullman (D-OR) stated that the conference report
“responsibly faces up to the issues of Social Security, both short range and long
range.” Mr. Ullman also assured Members that he would “move as
expeditiously as possible ... toward adopting a new revenue mechanism whereby260
we can back off from these major increases....”
c.On December 15, 1977, the Senate passed the conference report with little261
controversy by a vote of 56 (17-R, 39-D) to 21 (14-R, 7-D).
V. P.L. 96-265, Social Security Disability Amendments of
1980
H.R. 3236, the Social Security Disability Amendments of 1980, was signed by
President Carter on June 9, 1980. H.R. 3236 changed the Social Security disability
insurance program in four major ways: (1) it placed a new limit on family benefits
256 Congressional Record. November 4, 1977. Senate. p. 37141.
257 Congressional Record. November 4, 1977. Senate. Roll call no. 631, not voting 31. p.
258 Congressional Quarterly Almanac: 1977. p. 171.
259 Congressional Record. December 15,1977. House. Roll call no. 782, not voting 81. p.
260 Congressional Record. December 15, 1977. House. In floor remarks by Mr. UIIman.
p. 39007-39008.
261 Congressional Record. December 15, 1977. Senate. Roll call no. 636, not voting 22.
p. 39152-39153
to prevent Social Security benefits from exceeding the worker’s previous average
earnings; (2) it provided incentives for recipients to return to work; (3) it required a
higher percentage of federal reviews of new disability awards and more frequent
periodic state-level reexamination of existing recipients; and (4) it modified the
administrative relationship between the federal government and states. The
amendments also made similar changes in disability payments under the SSI program
and established federal standards for “medigap” insurance policies sold by private
insurance companies to supplement federal Medicare health insurance.
1. House Action. The House Ways and Means Committee’s Subcommittee
on Social Security held public hearings in February and March 1979. Following
these hearings, the Subcommittee held mark-up sessions on H.R. 2854, the
Administration’s proposals, and incorporated its recommendations into H.R. 3236,
which was introduced on March 27, 1979. After considering the Subcommittee’s
recommendations, the full Committee on Ways and Means reported the bill to the
House on April 23, 1979. Action on the bill was delayed as several major groups
raised questions about the legislation, and controversy arose as to the rules under
which the bill would be considered on the House floor. Many of the interested
parties wanted an opportunity to consider several of the provisions separately when
H.R. 3236 was considered on the floor, rather than to vote for or against the bill as
a whole. The Rules Committee held hearings on June 6 and 7, 1979, and reported
out on June 7, 1979, H.Res. 310, which provided for a modified rule and one hour
of debate on H.R. 3236. The rule provided that the only amendments that would be
in order would be those recommended by the Ways and Means Committee (which
were not amendable) and an amendment offered by Mr. Simon (D-IL) that would
delay the implementation of a provision affecting vocational rehabilitation funding
by one year. Despite the passage of the rule, “the opposition coalition was able to
block floor consideration of the measure for 3 months.”262 Floor debate on H.R. 3236263
did not begin until September 6, 1979.
a.On September 6, 1979, the House agreed to the Ways and Means Committee
and Mr. Simon’s amendments264 and passed H.R. 3236 by a vote of 235 (108-265
R, 127-D) to 162 (36-R, 126-D).
2. Senate Action. In October 1979, the Senate Finance Committee held
hearings on proposed disability legislation. The Committee completed its markup
on November 7, 1979, and reported H.R. 3236 to the Senate on November 8, 1979.
On December 5, 1979, the Senate began floor debate. Final debate, which occurred
262 Congressional Quarterly Almanac, 1979. p. 505.
263 Social Security Administration. “Social Security Disability Amendments of 1980:
Legislative History and Summary of Provisions.” Social Security Bulletin, v. 44, no. 4,
April 1981. p. 14-23. (Hereafter cited as “Social Security Disability Amendments of 1980:
Legislative History.”)
264 Congressional Record. September 6, 1979. House. p. 23398 and p. 23401.
265 Congressional Record. September 6, 1977. House. Roll call no.447, not voting 37. p.
in late January 1980, centered primarily on the provision to establish a lower limit on
family benefits.266
a.On January 30, 1980, Mr. Metzenbaum’s (D-OH) amendment to increase the
limit on disability benefits from 85 to 100% of the worker’s previous average
earnings was defeated by a vote of 47 (7-R, 40-D) to 47 (31-R, 16-D).267
b.On January 30, 1980, Mr. Bayh (D-IN) offered an amendment to exempt
terminally-ill applicants from the waiting period. The amendment was limited
to people who, in the opinion of two doctors, would probably die within a year.
Mr. Bayh said it was cruel to deny assistance to desperately ill people on the
basis of an arbitrary waiting period that lasted longer than most of them were
likely to live.
Mr. Long (D-LA) said elimination of the waiting period for one group would
eventually lead to its elimination for all disabled persons, at a cost of $3 billion
a year. Mr. Long also argued that the amendment was not germane since there
was nothing in the bill relating to the waiting period for benefits. The
amendment was ruled out of order but the Senate voted 37 (19-R, 18D) to 55
(17-R, 38-D) against the ruling of the chair,268 and then adopted the Bayh
amendment by a vote of 70 (25-R, 45-D) to 23 (12-R, 11-D).269
c.On January 31, 1980, the Senate passed H.R. 3236, with amendments, by a vote
of 87 (35-R, 52-D) to 1 (1-D).270
3. Conference Action. On May 13, 1980, the conference committee
reported the bill.271 On the key issue of limiting future family benefits, the conferees
combined the Senate limit of 85% of the worker’s previous average work earnings
and the House provision limiting benefits to no more than 150% of the worker’s272
basic individual benefit. The conferees also made a modification to the medigap
provision (added by the Senate) and dropped the Senate amendment regarding the
waiting period for the terminally ill, calling for a study of the issue instead.
266 “Social Security Disability Amendments of 1980: Legislative History.” p. 23-24.
267 Congressional Record. January 30, 1980. Senate. Roll call no.23, not voting 6. p. 1231.
268 Congressional Record. January 30, 1980. Senate. Roll call no. 18, not voting 8. p.
269 Congressional Record. January 30, 1980. Senate. Roll call no. 19, not voting 7. p.
270 Congressional Record. January 31, 1980. Senate. Roll call no. 27, not voting 12. p.
271 “Social Security Disability Amendments of 1980: Legislative History.” p. 24.
272 Congressional Quarterly Almanac: 1980. p. 437.
a.On May 22, 1980, the House passed H.R. 3236, as agreed to by the conferees,
by a vote of 389 (147-R, 242-D) to 2 (2-D).273
b.On May 29, 1980, the Senate passed the conference report on H.R. 3236 by a
voice vote.274
W. P.L. 96-403, Reallocation of OASl and Dl Taxes
On October 9, 1980, H.R. 7670, the Reallocation of Social Security Taxes
Between OASl and Dl Trust Funds, was signed into law by President Carter.
Although the Social Security Amendments of 1977 did, in part, remedy the
program’s financing problems, high inflation increased Social Security benefits and
higher than expected unemployment reduced income to the trust funds. The outlook
for the OASI program, in particular, was deteriorating fairly rapidly. H.R. 7670
shifted revenues from the Disability Insurance Trust Fund to the Old-Age and
Survivors Trust Fund during 1980 and 1981 so that adequate reserves could be
maintained in both trust funds at least through the end of calendar year 1981.
1. House Action. On July 21, 1980, Mr. Pickle (D-TX) moved to suspend
the rules and pass H.R. 7670. In his remarks, Mr. Pickle said that “the bill we bring
today is a deliberate step both to insure the stability of the trust funds and to provide
the Congress the time it will need to make any further changes necessary.” He also
stated that “Reallocation, the mechanism used in H.R. 7670, has been the traditional
way of redistributing the OASDI tax rates when there have been changes in the law
and in the experience of programs and in order to keep all the programs on a more
or less even reserve ratio .... Reallocation means that the formula for allocating the
incoming payroll tax receipts is changed in the law so that funds will flow into the
various funds in a different mix than currently projected.”275
a.On July 21, 1980, the House suspended the rules and passed H.R. 7670. There276
was no roll call vote.
a.On September 25, 1980, H.R. 7670 was passed by unanimous consent.277
273 Congressional Record. May 22, 1980. House. Roll call no. 253, not voting 42. p.
274 Congressional Record. May 29, 1980. Senate. p. 12628.
275 Congressional Record. July 21, 1980. House. In floor remarks by Mr. Pickle. p. 18827.
276 Congressional Record. July 21, 1980. House. p. 18830.
277 Congressional Record. September 25, 1980. Senate. p. 27297.
X. P.L. 96-473, Retirement Test Amendments278
On October 19, 1980, H.R. 5295 was signed by President Carter. It made
various changes in the earnings test provisions enacted in 1977 and limited the
circumstances under which Social Security benefits could be paid to prisoners.
Before enactment of P.L. 96-473, two earnings tests applied to Social Security
benefits. One was an annual test, the other a monthly test. If a recipient earned more
than the annual limit, his benefits were reduced $1 for every $2 of excess earnings
until all Social Security benefits were withheld. Under the monthly earnings test,
however, if a person’s earnings were less than one-twelfth of the annual amount, he
or she could get full benefits for that month, regardless of annual earnings.279 The
1977 provision eliminating the monthly earnings test was designed with retirees in
mind. However, the language as enacted applied to all classes of recipients affected
by the earnings limitation. Generally, these recipients are likely to get a job and have
substantial earnings in the year their benefits end. If these earnings were over the
annual earnings limitation, some of the benefits they already received in the year
become overpayments and had to be repaid.280 P.L. 96-473 modified this by allowing
individuals who received a dependent’s benefit (a child or student’s benefit, mother’s
benefit, or father’s benefit) to use the monthly earnings test in the year in which their
entitlement to such benefits ended. P.L. 96-473 also allowed all recipients to qualify
for at least 1 “grace year” in which the monthly earnings test applies, and made other
changes relating to the earnings test for the self-employed, particularly those whose
incomes were often in “deferred” forms.
In addition, P.L.96-473 prohibited payment of Social Security disability
insurance benefits or of student benefits (based on any kind of Social Security status)
to prisoners convicted of a felony, except where the individual is participating in a
court-approved rehabilitation program (but allowed benefits to be paid to their
dependents); disallowed impairments that arise from or are aggravated by the
commission of a crime to be considered in determining whether a person is disabled;
and disallowed impairments developed while an individual is in prison to be
considered in determining disability while the person remains in prison.
278 Other Social Security measures were taken up by the Congress in 1980. On December
96-499), which limited the maximum number of months of retroactive entitlement to OASI
benefits from 12 months to 6 months. Also, both the House and Senate passed resolutions
expressing disapproval of the Social Security Advisory Council’s recommendation that half
of Social Security benefits be made subject to federal income tax. House Concurrent
Resolution 351 was approved by the House on July 21, 1980, by a vote of 384 to 1, and
Senate Resolution 432 was approved by the Senate on August 4, 1980, by voice vote.
279 Congressional Quarterly Almanac, 1980. p. 295.
280 U.S. Congress. House. Committee on Ways and Means. Earnings Test for Social
Security Recipients. Report to Accompany H.R. 5295. October 19, 1979. Report No. 96-
U.S. Congress. Senate. Committee on Finance. Amendments to the Social Security
Program. Report to Accompany H.R. 5295. September 24, 1980. Report No. 96-987. 96th
Cong., 2d Sess. Washington, GPO, 1980.
1. House Action. On July 23, 1979, the House Ways and Means
Committee’s Subcommittee on Social Security held a hearing on the Social Security
earnings test. In the spring of 1980, Congress also was concerned with the issue of
paying Social Security benefits to prisoners. The Subcommittee on Social Security
held hearings on the subject, and numerous bills prohibiting payments to prisoners
were introduced.
a.On December 19, 1979, Mr. Long (D-LA) in discussing the earnings test as
amended by the 1977 amendments said, “The purpose of the change was to
simplify the test and make more evenhanded the treatment of those who had
similar amounts of annual earnings but differences in monthly work patterns.
Several categories of recipients have been experiencing unforeseen problems
with the new annual earnings test, however, and have been disadvantaged by it.
H.R. 5295 is designed to correct those inequities.”281
b.On December 19, 1979, H.R. 5295, as amended, was passed unanimously by the
House, 383 to 0.282
2. Senate Action. On April 21, 1980, the Senate Finance Committee’s
Subcommittee on Social Security held a hearing on the Social Security earnings test.
During the spring of 1980, the Subcommittee also held hearings on the subject of
denying Social Security benefits to prisoners. When S. 2885, the 1981 Budget
Reconciliation bill, was reported out of the Senate Finance, it included a provision
that prohibited payment of Social Security disability benefits to prisoners convicted
of crimes. The Finance Committee also included this measure in H.R. 5295.
a.On September 30, 1980, the Senate passed H.R. 5295, with amendments, by
unanimous consent.283
a.On October 1, 1980, Mr. Conable (R-NY) remarked “The only amendment that
we are asking to be attached here that goes to the Senate is an amendment that
changes the word “crime” to the words “crime in the nature of a felony,” so that
it would apply only to more serious crimes and not possibly to traffic infractions
and things of that sort.”284
b.On October 1, 1980, the House concurred in the Senate amendments with an
amendment by unanimous consent.285
281 Congressional Record. December 19, 1979. House. p. 36961.
282 Congressional Record. December 19, 1979. House. Roll call no. 751, not voting 50.
p. 36969.
283 Congressional Record. September 30, 1980. Senate. p. 28195.
284 Congressional Record. October 1, 1980. House. p. 8676-28677.
285 Congressional Record. October 1, 1980. House. p. 28677.
a.On October 1, 1980, Mr. Byrd’s motion that the Senate concur with the House
amendment to the Senate amendment was agreed to by voice vote.286
Y. P.L. 97-35, The Omnibus Budget Reconciliation Act of
1981
H.R. 3982, the Omnibus Budget Reconciliation Act of 1981, was signed into
law (P.L. 97-35) by President Reagan on August 13, 1981. It included most of the
Social Security changes proposed as part of the President’s 1982 budget, as well as
some added by the House. The Social Security provisions were among many outlay
reduction measures intended to constrain federal expenditures. The Administration
argued that the benefits it targeted for elimination or reduction were not directed at
the basic goals of the program, and it did not consider them to have been “earned.”
The budget proposals eliminated the minimum Social Security benefit for both
current and future recipients,287 phased out benefits for students in postsecondary
schools (age 18 and older, except for those under age 19 still in high school), made
lump-sum death benefits available only to a spouse who was living with the worker
or a spouse or child eligible for immediate monthly survivor benefits, and reduced
benefits for those whose Social Security disability payments and certain other public
pensions exceed 80% of pre-disability earnings. The amendments also eliminated
reimbursement of the cost of state vocational rehabilitation services from the trust
funds except where it could be shown that the services had resulted in the disabled
person leaving the rolls; postponed the lowering of the earnings test exempt age
(from 72 to 70) until 1983; ended parents’ benefit when the youngest child reaches
age 16; and provided that workers and their spouses would not receive benefits
unless they meet the requirements for entitlement throughout the month. These last
three provisions were initiatives added by the Ways and Means Committee.
1. Senate Action.288 Because the Social Security legislation was considered
in the context of the budget and reconciliation processes, there was virtually
simultaneous consideration of the proposals by the House and the Senate. After final
286 Congressional Record. October 1, 1980. Senate. p. 28881.
287 The minimum benefit is the smallest benefit (before actuarial or earnings test reduction)
payable to a worker or from which benefits to his survivors/dependents will be determined.
In 1977, the minimum benefit was frozen at $122 per month for workers who became
disabled or died after 1978, or reached age 62 after 1983. However, the 1981 legislation
eliminated the minimum benefit for all people becoming eligible for benefits in January
1982 or later (except it exempted for 10 years certain members of religious orders who have
taken a vow of poverty — these people have their benefits computed under the regular
benefit computation rules). People already eligible for benefits before 1982 are able to
continue receiving the minimum benefit.
288 The Senate action is given first because the Senate passed the bill before the House did.
adoption (May 21, 1981) of the First Concurrent Budget Resolution, both the House
and the Senate were acting within similar reconciliation guidelines.289
a.On June 10, 1981, the Finance Committee reported its recommendations for
spending reductions. These were included by the Senate Budget Committee in
S. 1377, the Omnibus Budget Reconciliation Act of 1981, which was reported
by the Budget Committee to the Senate on June 17, 1981. The Social Security
proposals included in S. 1377 were basically those proposed by the
Administration with some minor modifications.
b.On June 22-25, 1981, the Senate debated S. 1377. The most controversial
aspect of the bill relating to the Social Security program was the elimination of
the minimum benefit for people already on the benefit rolls. On June 23, 1981,
Mr. Riegle (D-MI) offered an amendment that would have eliminated the
minimum benefit only for future recipients. The amendment was defeated by
a vote of 45 (4-R, 41-D) to 53 (48-R, 5-D).290
c.On June 25, 1981, the Senate passed S. 1377, with the Finance Committee’s
Social Security proposals, by a vote of 80 (52-R, 28-D) to 15 (O-R, 15-D).291
2. House Action. The Ways and Means Committee recommendations, while
touching on some of the same benefit categories as the Administration’s proposals,
were notably different. These proposals were incorporated by the Budget Committee
into its version of the Omnibus Budget Reconciliation Act of 1981, H.R. 3982, which
was reported to the House on June 19, 1981.
The adoption of the rule for floor consideration of H.R. 3982 became, in itself,
a highly controversial issue. The Democratic leadership argued for allowing six
separate votes on the grounds that this would allow for greater accountability for
individual Members and avoid criticisms of “rubber-stamping” the Administration’s292
proposals. A bipartisan group of Members (generally supported by the
Administration) argued instead for a rule that allowed only an up-or-down vote on
a substitute for the Budget Committee bill sponsored by Mr. Gramm (D-TX) and Mr.
Latta (R-OH).293 Those arguing for the substitute said it would facilitate future
conference agreement by bringing H.R. 3982 more closely in line with the
President’s original proposals and with S. 1377 then pending in the Senate.294
289 “Social Security Administration. Omnibus Budget Reconciliation Act of 1981:
Legislative History and Summary of OASDI and Medicare Provisions” [by] John A. Svahn.
Social Security Bulletin, v. 44, no.10, October 1981. p.7. (Hereafter cited as “Omnibus
Budget Reconciliation Act of 1981: Legislative History.”)
290 Congressional Record. June 23, 1981. Senate. Roll call no. 160, not voting 2. p.
291 Congressional Record. June 25, 1981. Senate. Roll call no. 182, not voting 5. p.
292 “Omnibus Budget Reconciliation Act of 1981: Legislative History,” p. 11.
293 Ibid.
294 Ibid.
a.On June 25, 1981, the original rule for floor consideration of the bill was
defeated by a vote of 210 (l-R, 209-D) to 217 (188-R, 29-D).295
b.A package of amendments by Mr. Latta, the so-called Gramm-Latta II
alternative, called for (1) deletion of the Ways and Means’ proposal to move the
COLA from July to October and (2) changing the effective date of the Senate-
passed minimum benefit proposal, affecting both current and future recipients,
and (3) the Senate-passed student benefit phase-out proposal (which contained
a faster phase-out than the Ways and Means Committee version). The Gramm-
Latta II alternative package passed the House on June 26, 1981, by a vote of 217
(188-R, 29-D) to 211 (2-R, 209-D).296
c.On June 26, 1981, the House passed the Omnibus Budget Reconciliation Act
of 1981 by a vote of 232 (185-R, 47-D) to 193 (5-R, 188-D).297
3. Conference Action. The passage of the alternative budget package
resulted in House-passed Social Security measures that were very similar to the
Administration’s original proposals and to those in the Senate-passed reconciliation
bill. On July 13, 1981, the Senate voted to substitute the reconciliation proposals
from S. 1377 for those passed by the House in H.R. 3982 and to go to conference to298
resolve the differences.
On July 30, 1981, Mr. Bolling (D-MO), Chairman of the House Rules
Committee, threatened to prevent the conference agreement from being brought to
the House floor for final approval until something could be worked out to modify the
minimum benefit provision. An agreement was worked out permitting a bill that
would modify the minimum benefit provision to be brought to the House floor before
the vote on the reconciliation conference report. This bill was H.R. 4331, the Social
Security Amendments of 1981. (See following section for further details.)
a.On July 31, 1981, both the House and the Senate approved the conference report
on the 1981 Budget Reconciliation bill, the House by a voice vote and the299
Senate by a vote of 80 (49-R, 31-D) to 14 (l-R, 13-D).
Z. P.L. 97-123, The Social Security Amendments of 1981
H.R. 4331, the Social Security Amendments of 1981, was signed by President
Reagan on December 29, 1981. The amendments restored the minimum benefit for
current recipients, but eliminated it for people becoming eligible for benefits after
December 31, 1981 (see discussion of P.L. 97-35 above). In July 1981, as part of
295 Congressional Record. June 25, 1981. House. Roll call no. 104, not voting 4. p. 14078-
296 Congressional Record. June 26, 1981. House. Roll call no. 111, not voting 4. p. 14681-
297 Congressional Record. June 26, 1981. House. Roll call no. 113, not voting 6. p. 14794-
298 “Omnibus Budget Reconciliation Act of 1981: Legislative History.” p. 13.
299 Congressional Record. July 31,1981. Senate. Roll call no. 247, not voting 6. p. 19144.
P.L. 97-35, Congress had enacted the elimination of the minimum benefit effective
in April 1982. However, the public outcry was so great that both Houses and the
Administration thought it prudent to reconsider the measure.300 H.R. 4331 also
allowed the financially troubled OASI trust fund to borrow from the healthier
disability insurance and hospital insurance trust funds until December 31, 1982. The
law specified that the borrowing could not exceed amounts needed to pay full
benefits for six months and provided for repayment of any amounts borrowed. OASI
borrowed $17.5 billion from the two trust funds late in December 1982, an amount
limited to that necessary to keep benefits flowing until June 1983.
In addition, the bill: (1) allowed members of religious orders who had taken a
vow of poverty and were covered by Social Security before enactment of the bill to
continue to become eligible for the minimum benefit during the next 10 years; (2)
extended the payroll tax to the first six months of sick pay; (3) made it a felony to
alter or counterfeit a Social Security card; and (4) allowed the Department of Health
and Human Services access to recorded Social Security numbers to prevent ineligible
prisoners from receiving disability benefits.
I. House Action. On July 21, 1981, the House, by a vote of 405 (176-R, 229-
D) to 13 (10-R, 3-D),301 adopted a non-binding resolution (H.Res. 181) urging that
steps be taken “to ensure that Social Security benefits are not reduced for those
currently receiving them.” After the conference report on the reconciliation bill was
filed, the House Rules Committee Chairman Richard Bolling (D-MO) held up the
reconciliation bill in his Committee in an effort to restore the minimum benefit. An
agreement was subsequently reached whereby the budget bill would be reported out
of the Rules Committee intact, and a separate bill to restore the minimum benefit for
all current and future recipients (H.R. 4331) would be taken up by the House before
the vote on the budget bill.302 The House passed H.R. 4331 on July 31, 1981. It
repealed the section of P.L. 97-35 that eliminated the minimum benefit, thereby
reinstating the minimum benefit for current and future recipients.
a.On July 31, 1981, the House passed H.R. 4331 by a vote of 404 (172-R, 232-D)303
to 20 (17-R, 3-D).
MI), Mr. Moynihan (D-NY), and Mr. Kennedy (D-MA) moved to have the Senate
immediately consider it. The Senate’s presiding officer ruled the motion out of order,
300 Congressional Quarterly Almanac, 1981. p. 117.
301 Congressional Record. July 21,1981. House. Roll call no. 145, not voting 15. p. 16659-
302 Congressional Quarterly Almanac, 1981. p. 119-120.
303 Congressional Record. July 31, 1981. House. Roll call no. 189, not voting 10. p.
and the ruling was upheld by a vote of 57 to 30,304 thereby permitting consideration
of the bill by the Finance Committee and delaying a Senate vote until October.
The bill reported by the Finance Committee in September 1981 included
provisions that restored the minimum benefit for current recipients, except for those
with government pensions, whose so-called “windfall” Social Security benefits
would be reduced dollar for dollar by the extent their government pension exceeded
$300 a month. The bill provided that members of religious orders who became
eligible for Social Security in 1972 could remain eligible for the minimum benefit
for the next 10 years. To offset the cost of restoring the minimum benefit, the Senate
agreed to apply the payroll tax to the first six months of all sick pay received and to
lower the maximum family retirement and survivor benefit to 150% of the worker’s
primary insurance amount (PIA). The bill also allowed inter-fund borrowing.
a.On October 14, 1981, the Senate by a voice vote agreed to (1) Mr. Danforth’s
(R-MO) amendment to override provisions of the federal Privacy Act to allow
access to prison records so that disability payments to ineligible inmates could
be stopped;305 and (2) Mr. Baucus’ (D-MT) amendment to make it a felony to
alter or counterfeit a Social Security card.306
b.On October 15, 1981, Mr. Dole’s (R-KS) amendment to apply the Social
Security payroll tax to the first six months of all employer-financed sick pay,
except that paid as insurance, was accepted by voice vote.307
c.On October 15, 1981, Mr. Moynihan’s (D-NY) amendment requiring
counterfeit-proof Social Security cards was agreed to by voice vote.308
d.On October 15, 1981, Mr. Eagleton (D-MO) offered an amendment to repeal a
provision of the Economic Recovery Tax Act of 1981 (P.L. 97-34) that had
reduced windfall profit taxes on newly discovered oil, and then use these tax
savings to build an emergency reserve for the Social Security trust funds. The
amendment was tabled 65 (42-R, 23-D) to 30 (7-R,23-D).309
e.On October 15, 1981, by a unanimous vote of 95 (48-R, 47-D) to 0, the Senate
passed H.R. 4331, as amended.310
3. Conference Action. The Congressional Quarterly Almanac states that the
major dispute of the conference was whether to pay for the cost of restoring the
minimum benefit by tax increases or by benefit cuts. The conferees finally agreed
to accept only the sick pay tax “on the condition that inter-fund borrowing be allowed
304 Congressional Record. July 31, 1981. Senate. Roll call no. 248, not voting 12. p.
305 Congressional Record. October 14, 1981. Senate. p. 23967.
306 Congressional Record. October 14, 1981. Senate. p. 23971.
307 Congressional Record. October 15, 1981. Senate. p. 24107.
308 Congressional Record. October 15, 1981. Senate. p. 24108.
309 Congressional Record. October 15, 1981. Senate. Roll call no. 312, not voting 5. p.
310 Congressional Record. October 15, 1981. Senate. Roll call no. 315, not voting 5. p.
for just one year.”311 The conference agreement restored the minimum benefit to
recipients eligible for benefits before 1982, and it rejected the Senate provisions (1)
to reduce the minimum for those also receiving government pensions above $300 per
month and (2) to limit further family benefits in OASI cases.
a.The Senate agreed to the conference report on December 15, 1981, by a vote of
b.The House agreed to the conference report on December 16, 1981, by a vote of
AA. P.L. 97-455, An Act Relating to Taxes on Virgin Island
Source Income and Social Security Disability Benefits
President Reagan signed H.R. 7093 on January 12, 1983. In March 1981, the
Administration began implementing the continuing disability investigation process
mandated (beginning in 1982) under the 1980 amendments (P.L. 96-265), with the
result that thousands of recipients lost their benefits, although many were restored
upon appeal to an administrative law judge. P.L. 97-455 was a “stopgap” measure
to remedy some of the perceived procedural inequities in the disability review
process. It provided, temporally, an opportunity for individuals dropped from the
rolls before October 1, 1983, to elect to receive DI and Medicare benefits while they
appealed the decision; June 1984 was to be the last month for which such payments
could be made.314 The DI benefits would have to be repaid if the appeal were lost.
The measure also required the Department of Health and Human Services to provide,
as of January 1, 1984, face-to-face hearings during reconsideration of any decision
to terminate disability benefits. Previously, recipients did not have such a meeting
until they appeared before an administrative law judge. The bill also required the
Secretary to report to Congress semiannually on the rate of continuing disability
reviews and terminations; and gave the Secretary authority to decrease the number
of disability cases sent to State agencies for review.
1. Senate Action.315 On September 28, 1982, the Finance Committee marked
up S. 2942, which contained a number of continuing disability review provisions.
The Chairman, Mr. Dole (R-KS), asked that S. 2942 be attached to a House-passed
bill (H.R. 7093) dealing with Virgin Islands taxation. Thus, H.R. 7093, with
provisions of S. 2942, was reported to the Senate on October 1, 1982.
311 Congressional Quarterly Almanac, 1981. p. 121.
312 Congressional Record. December 15, 1981. Senate. Roll call no. 486, not voting 4. p.
313 Congressional Record. December 16, 1981. House. Roll call no. 365, not voting 11.
p. 31699.
314 P.L. 98-118 extended until December 7, 1983, the period for which the provisions
continuing payment of Social Security disability benefits during appeal were applicable.
315 In a departure from format, the Senate action is given first because the Senate passed the
bill (with regard to Social Security provisions) before the House did.
a.On December 3, 1982, Mr. Heinz (R-PA) said, “. . . this emergency legislation
does not completely solve the problem of the unfair terminations of hundreds
of thousands of disabled individuals . . . nonetheless. It means that in the
immediate future, at least, individuals who have been wrongly terminated will
not be financially ruined because they have been deprived of their benefits
during a lengthy appeals process.”316
b. On December 3, 1982, the Senate passed H.R. 7093 by a vote of 70 (43-R, 27-
D) to 4 (l-R, 3-D).317
voice vote. This version of the bill contained no Social Security provisions.
a.On December 14, 1982, the House amended the Senate-passed version of H.R.
7093 and passed it by unanimous consent.319 H.R. 7093 was then sent back to
the Senate for consideration of the added amendments. These amendments
required the Secretary to (1) provide face-to-face hearings during
reconsideration of any decision to terminate disability benefits; (2) advise
recipients of what evidence they should bring to and what procedures they
should follow at the reconsideration hearing; and (3) provide that, for a five-year
period beginning December 1, 1982, only one-third of a spouse’s government
pension would be taken into account when applying the government pension
offset provision enacted in 1977.
3. Conference Action. The bill as agreed to by the conferees was identical
to the House-passed bill, except for the modification in the government pension
offset provision.
a.The House passed the conference report on H.R. 7093 on December 21, 1982,
by a vote of 259 (115-R, 144-D) to 0.320
b.The Senate passed the report by a voice vote on December 21, 1982.321
BB. P.L. 98-21, The Social Security Amendments of 1983
H.R. 1900, the Social Security Amendments of 1983, was signed by President
Reagan on April 20, 1983. The latest projections showed that the OASDI program
was projected to run out of funds by mid-1983, and to need about $150 to $200
billion to provide reasonable assurance that it would remain solvent for the rest of the
316 Congressional Record. Daily Edition, December 3, 1982. Senate. p. Sl3857.
317 Congressional Record. Daily Edition, December 3, 1982. Senate. Roll call no. 394, not
voting 26. p. S13869.
318 Congressional Record. Daily Edition, September 20, 1982. House. p. H7219.
319 Congressional Record. Daily Edition, December 14, 1982. House. p. H9665.
320 Congressional Record. Daily Edition, December 21, 1982. House. Roll call no. 487,
not voting 174. p. HI0679-10680.
321 Congressional Record. Daily Edition, December 21, 1982. Senate. p. S15966.
decade.322 Once this short-run problem was addressed, the program was projected
to be adequately financed for about 35 years. However, beginning about 2025, the
effects of the retirement of the baby-boom was projected to plunge the system into
deficit again. The National Commission on Social Security Reform, a bipartisan
panel appointed by President Reagan and congressional leaders, was formed to seek
a solution to the system’s financing problems. On January 15, 1983, a majority of
the Commission members reached agreement on a package of changes.
Conforming to most of the recommendations in the Commission’s package, the
1983 amendments: put new federal employees and all nonprofit organization
employees under the OASDI program as of January 1, 1984; prohibited state and
local and nonprofit agencies from terminating Social Security coverage; moved the
annual cost-of-living adjustments in benefits from July to January of each year
(which caused a delay of six months in 1983); made up to one-half of the benefits
received by higher income recipients subject to federal income taxation; gradually
raised the full benefit retirement age from 65 to 67 early in the next century;
increased benefits for certain groups of widow(er)s; liberalized the earnings test;
increased the delayed retirement credit; reduced benefits for workers also getting
pensions based on noncovered employment; called for the earlier implementation of
scheduled payroll tax increases; and substantially raised the tax rates on the self-
employed. P.L. 98-21 also stipulated that beginning with the FY1993 budget,
income and expenditures for OASDI and HI would no longer be included in federal
budget totals. The 1983 amendments also stipulated that only two-thirds of a
spouse’s government pension would be taken into account when applying the
government pension offset provision, eliminated remaining gender-based
distinctions, and made numerous additional technical changes in the law.
1. House Action. On March 4, 1983, the Ways and Means Committee
reported out H.R. 1900. The bill included most of the recommendations of the
National Commission, numerous additional relatively minor Social Security
provisions, and other measures mostly related to long-run financing issues, along
with provisions affecting the Medicare and Unemployment Insurance programs.
On March 9, 1983, the House debated H.R. 1900. Proponents of the bill
maintained that, although there were many provisions that individuals or certain
groups might find troublesome, there was an overriding need to deal quickly and
effectively with the Social Security financing issues. Opponents questioned whether
this was the best way to solve the system’s projected financial difficulties. Many
favored raising the retirement age instead of increasing payroll taxes.
a.On March 9, 1983, Mr. Pickle’s (D-TX) amendment calling for increases in the
age at which “full” retirement benefits (i.e., unreduced for early retirement) are
payable to 66 by 2009 and to 67 by 2027 was approved by a vote of 228 (152-R,
322 Based on estimates by the National Commission on Social Security Reform.
323 Congressional Record. Daily Edition, March 9, 1983. House. Roll call no. 22, not
voting 3. p. H1064-H1065.
but at 70% of full benefits (instead of 80%), becoming fully effective after the
“full retirement age” reached 67.
Mr. Pepper (D-FL) then offered a substitute amendment to raise the OASDI tax
rate from 6.20% to 6.73% beginning in 2010. The amendment was rejected by
a vote of 132 (1-R, 131-D) to 296 (16-R, 131-D).324 Had the amendment
passed, it would have superseded Mr. Pickle’s amendment.
b.The House passed H.R. 1900, as it had been amended, by a vote of 282 (97-R,
2. Senate Action. The Senate Finance Committee reported out S. 1 on
March 11, 1983. As with the House bill, the Committee adopted long-term financing
measures along the lines of the recommendations of the National Commission and
provisions affecting the Medicare and Unemployment Insurance programs.
The full Senate began consideration of H.R. 1900 on March 16, 1983. Seventy-
two amendments were offered to the bill on the floor; the Senate adopted 49 of them.
The following were among the major amendments debated.
a.On March 23, 1983, Mr. Long (D-LA) offered an amendment to make coverage
of newly hired federal employees contingent upon enactment of a supplemental326
civil service plan for them. It was passed by a voice vote.
b.An amendment to the Long amendment by Mr. Stevens (R-AL) and Mr.
Mathias (R-MD) to exclude federal workers from coverage altogether was
rejected by a vote of 12 (8-R, 4-D) to 86 (46-R, 40-D) on March 23, 1983.327
c.Mr. Stevens’ amendment to the Long amendment to require the creation of a
supplemental civil service retirement program by October 1985, while granting
new employees wage credits toward such a plan in the meantime, was rejected
d.The Senate passed H.R. 1900 on March 23, 1983, by a vote of 88 (47-R, 41-D)
to 9 (6-R, 3-D).329
324 Congressional Record. Daily Edition, March 9, 1983. House. Roll call no. 24, not voting
325 Congressional Record. Daily Edition, March 9, 1983. House. Roll call no. 26, not voting
326 Congressional Record. Daily Edition, March 23, 1983. Senate. p. S3711.
327 Congressional Record. Daily Edition, March 23, 1983. Senate. Roll call no. 47, not
voting 2. p. S3714.
328 Congressional Record. Daily Edition, March 23, 1983. Senate. Roll call no. 48, not
voting 4. p. S3720.
329 Congressional Record. Daily Edition, March 23, 1983. Senate. Roll call no. 53, not
voting 3. p. S3775.
3. Conference Action.330 On March 24, 1983, conferees agreed to the final
provisions of H.R. 1900. The primary issue was how to solve the system’s long-run
financial problems. The House measure called for a two-year increase in the
retirement age, while the Senate bill proposed to increase the retirement age to 66,
eliminate the earnings test, and cut initial benefit payments 5%. Another major
difference was a provision in the Senate bill delaying coverage of new federal
employees until a supplemental civil service retirement plan could be developed.
House conferees charged that if the change were made, no revenues from the
proposed coverage could be counted on for the Social Security bailout plan since, if
such a plan were not subsequently developed, federal workers might escape coverage
altogether.
The conferees agreed to the House retirement age change. Senate conferees then
agreed to recede on the federal employee coverage issue.
a.On March 24, 1983, the House passed the conference report by a vote of 243331
(80-R, 163-D) to 102 (48-R, 54-D).
b.On March 25, 1983, the Senate passed H.R. 1900, as agreed to in the conference332
report, by a vote of 58 (32-R, 26-D) to 14 (8-R, 6-D).
CC. P.L. 98-460, Social Security Disability Benefits Reform
Act of 1984
On October 9, 1984, President Reagan signed H.R. 3755, the Social Security
Disability Benefits Reform Act of 1984. P.L. 98-460 ended three years of
controversy over the Administration’s efforts to rid the Disability Insurance program
of ineligible recipients through an expanded periodic review process. The expanded
reviews had been authorized by the 1980 disability amendments.333
Shortly after implementation of periodic review, the public and Congress began
to criticize the process. The major complaints were: the large number of persons
dropped from the Dl rolls, of whom many had been receiving benefits for years and
had not expected their cases to be reviewed; the great increase in the number of cases
subjected to continuing disability reviews; and the number of cases in which
recipients were erroneously dropped from the rolls. More than half of those removed
from the rolls were reinstated upon appeal, fueling complaints that many terminations
were unjustified. Advocacy groups for the disabled raised questions about the Social
Security Administration’s termination policies and procedures and petitioned
330 Congressional Quarterly Almanac: 1983. p. 226.
331 Congressional Record. Daily Edition, March 24, 1983. House. Roll call no. 47, not
voting 88. p. H1787.
332 Congressional Record. Daily Edition, March 24, 1983. Senate. Roll call no. 54, not
voting 28. p. S4104.
333 Congressional Quarterly Almanac, 1984. p. 160.
Congress for legislative relief.334 In addition, concerns about the disability process
were raised by the federal courts and the states.
P.L. 98-460 provided that (1) with certain exceptions, benefit payments can be
terminated only if the individual has medically improved and can engage in
substantial gainful activity; (2) benefit payments can be continued until a decision by
the administrative law judge in cases where a termination of benefits for medical
reasons is being appealed; (3) reviews of all mental impairment disabilities be
delayed until regulations stipulating new medical listings for mental impairments are
published; (4) in cases of multiple impairments, the combined effect of all the
impairments must be considered in making a disability determination; (5) the
Department of Health and Human Services Secretary initiate demonstration projects
providing personal appearance interviews between the recipient and state agency
disability examiner in potential termination cases and potential initial denials; (6) the
Secretary issue uniform standards, binding at all levels of adjudication, for disability
determinations under Social Security and SSI disability; (7) the Secretary federalize
disability determinations in a state within six months of finding that a state is not in
substantial compliance with federal laws and standards; and (8) the qualifications of
representative payees be more closely examined, and that the Secretary establish a
system of annual accountability monitoring where benefit payments are made to
someone other than a parent or spouse living in the same household with the
recipient. It also established a temporary statutory standard for the evaluation of pain
and directed that a study of the problem of evaluating pain be made by a commission
to be appointed by the Secretary.
1. House Action. On March 14, 1984, the House Committee on Ways and
Means reported H.R. 3755 with amendments.
a.During debate on H.R. 3755, Mr. Conable (R-NY) remarked that the intent of
the 1980 legislation, requiring continuing disability reviews, was meritorious,
but the results were not what the drafters intended. Mr. Conable further stated,
“Not only were ineligible recipients terminated, but some eligible recipients
were taken from the rolls, as well. Many, especially those with mental
impairments, suffered duress and the economic hardship of interrupted
benefits.” Mr. Conable also said, “Both Congress and the administration have
taken remedial steps ... we approved P.L. 97-455, which, on an interim basis,
provided for the continuation of benefits during an appeal of an adverse decision
... H.R. 3755 represents the next step.”335
The sponsor of H.R. 3755, Mr. Pickle (D-TX), said, “In the past 3 years nearly
half a million disabled recipients have been notified that their benefits will end.
Far too often this notice has been sent in error, and corrected only at the
334 Social Security Administration. “Social Security Disability Benefits Reform Act of
4, April 1985. p. 12. (Hereafter cited as “Social Security Disability Benefits Reform Act
of 1984: Legislative History.”)
335 Congressional Record. Daily Edition, March 27, 1984. House. In floor remarks by Mr.
Conable. p. H1958.
recipient’s expense ... we who serve on the Social Security Subcommittee have
heard those pleas from the disabled, from Governors, and from those who must
administer this program in the states ... for over a year now we have carefully
drafted legislation to bring order to the growing chaos ... This bill does not
attempt to liberalize the disability program. It does restore order and humanity
to the disability review process.”336
b.On March 27, 1984, the House passed H.R. 3755 by a vote of 410 (160-R, 250-
D) to 1 (l-R).337
Secretary Heckler imposed a moratorium on periodic continuing disability reviews.
The Secretary said:
Although we have made important progress in reforming the review process
with Social Security, the confusion of differing court orders and state actions
persists. The disability program cannot serve those who need its help when its
policies are splintered and divided. For that reason, we must suspend the
process and work together with Congress to regain order and consensus in the
disability program.338
476. Major provisions of the bill allowed disabled persons to continue collecting
Social Security benefits if their medical condition had not improved since they were
determined disabled. The major difference between the medical improvement
provision in S. 476 and H.R. 3755 was that the Senate bill stated that the recipient
bore the burden of proof that his or her condition had not improved.
a.On May 22, 1984, Mr. Cohen (R-ME), one of the sponsors of S. 476, said, “The
need for fundamental change in the disability reviews has been evident for some
time. Since the reviews began, more than 12,000 individuals have filed court
actions challenging the Social Security Administration’s termination of their
benefits. An additional 40 class action suits had been filed as of last month.
The legislation before the Senate today would end this chaos and insure an
equitable review process.”339
b.Mr. Levin (D-MI), another sponsor, said, “It has taken us 3 years to come to
grips with the problems in the disability review process as a legislative body.
And while it was long in coming, I am pleased with the final outcome. The bill
I, along with Senator Cohen and others introduced on February 15, 1983, S.
336 Congressional Record. Daily Edition, March 27, 1984. House. In floor remarks by Mr.
Pickle. p. H1959.
337 Congressional Record. Daily Edition, March 27, 1984. House. Roll call no. 55, not
voting 22. p. H1992-H1993.
338 Social Security Disability Benefits Reform Act of 1984: Legislative History, p. 27.
339 Congressional Record. Daily Edition, May 22, 1984. Senate. In floor remarks by Mr.
Cohen. p. S6213-S6214.
476, as reported by the Finance Committee contains the essential ingredients to
the development of a fair and responsible review process.”340
c.On May 22, 1984, the Senate passed H.R. 3755, after substituting the language
of S. 476 for the House-passed version, 96 (52-R, 44-D) to 0.341
4. Conference Action. On September 19, 1984, the conferees filed the
conference report. The conference committee generally followed the House version
of the medical improvement standard (with some modifications) and added the
requirement that any continuing disability review be made on the basis of the weight
of the evidence with regard to the person’s condition.
a.On September 19, 1984, the House and Senate passed H.R. 3755 unanimously;342343
DD. P.L. 99-177, Public Debt Limit — Balanced Budget and
Emergency Deficit Control Act of 1985
The Balanced Budget and Emergency Deficit Control Act, which was included
as Title II of H.J.Res. 372, increasing the national debt, was signed by President
Reagan on December 12, 1985. The act stipulated that budget deficits must be
decreased annually, and under certain circumstances required across-the-board cuts
of non-exempt programs by a uniform percentages to achieve this result. Under the
act, if annual deficit amounts were larger than the law established, a formula would
be used to reduce the deficit annually until it reached zero in FY1991. This part of
P.L. 99-177 generally is referred to by the names of its sponsors — Senators Gramm
(R-TX), Rudman (R-NH), and Hollings (D-SC).344 The Gramm-Rudman-Hollings
Act accelerated the “off-budget” treatment of OASDI, as prescribed by P.L. 98-21,
from FY1993 to FY1986. (However, Social Security income and outgo still would
be counted toward meeting Gramm-Rudman-Hollings deficit reduction targets.) The
HI trust fund was not affected (i.e., not to be separated from the budget until
FY1993). In addition, the act exempted Social Security benefits (including COLAs)
from automatic cuts and required the Secretary of the Treasury to restore to the trust
funds any interest lost as a result of 1984 and 1985 debt ceiling constraints, and to
issue to the trust funds obligations bearing interest rates and maturities identical to
those of securities redeemed between August 31, 1985, and September 30, 1985.
340 Congressional Record. Daily Edition, May 22, 1984. Senate. In floor remarks by Mr.
Levin. p. 86230.
341 Congressional Record. Daily Edition, May 22, 1984. Senate. Roll call no. 109, not
voting 4. p. S6241.
342 Congressional Record. Daily Edition, September 19, 1984. House. Roll call no. 404,
not voting 30. p. H9838-H9839.
343 Congressional Record. Daily Edition, September 19, 1984. Senate. Roll call no. 243,
not voting 1. p. 11477.
344 In July 1986 the Supreme Court ruled that the automatic budget-cutting procedures in the
legislation referred to as Gramm-Rudman-Hollings were unconstitutional.
a.On August, 1, 1985, the House approved the debt-limit increase, unamended,
as part of the FY1986 budget resolution (S.Con.Res. 32) by a vote of 309 (127-
R, 182-D) to 119 (52-R, 67-D).345
a.On October 9, 1985, the Senate adopted the Gramm-Rudman-Hollings
amendment to H.J.Res. 372 (Balanced Budget and Emergency Control Act of
b.On October 10, 1985, the Senate passed H.J.Res. 372, with amendments, by a
vote of 51 (38-R, 13-D) to 37 (8-R, 29-D).347
3. Conference Action. On November 1, 1985, the conference report was
filed in disagreement. The House asked for another conference on November 6,
1985, the Senate agreeing on November 7, 1985. The second conference report was
filed on December 10, 1985.
a.On December 11, 1985, both the House and the Senate agreed to the conference348
report, the House by a vote of 271 (153-R, 118-D) to 154 (24-R, 130-D) and
the Senate by a vote of 61 (39-R, 22-D) to 31 (9-R, 22-D).349
EE. S.Con.Res. 32, Proposed COLA Constraints in FY1986
Budget Resolution
In 1985, the Senate voted to skip the 1986 COLA for various federal programs,
including Social Security, when it passed S.Con.Res. 32, the first concurrent budget
resolution for FY1986. However, the House-passed version had no COLA freeze,
and the proposal was dropped in conference.
a.In his FY1986 Budget submitted in January 1985, President Reagan
proposed that there be no COLA for several federal benefit programs,
among them civil service and military retirement, in 1986. However,
Social Security was exempted from the proposal. In considering
S.Con.Res. 32, the first concurrent budget resolution for FY1986 (which
345 Congressional Record. Daily Edition, August 1, 1985. House. Roll call no. 290, call
no. 290, not voting 5. p. H7166-H7167.
346 Congressional Record. Daily Edition, October 9, 1985. Senate. Roll call no. 213, not
voting 1. p. S12988.
347 Congressional Record. Daily Edition, October 10, 1985. Senate. Roll call no. 222, not
voting 12. p. S13114.
348 Congressional Record. Daily Edition, December 11, 1985. House. Roll call no. 454,
not voting 9. p. Hl1903-Hl1904.
349 Congressional Record. Daily Edition, December 11, 1985. Senate. Roll call no. 371,
not voting 6. p. S17443-S17444.
involves the goal-setting stage of the congressional budget process) on
March 14 the Senate Budget Committee, by a vote of 11(11-R, 0-D) to 10
(0-R, 10-D)350 added Social Security to the list of programs whose COLAs
were to be skipped in 1986. The Social Security portion of the COLA
“freezes,” as they were called, was estimated to yield $22 billion in savings
over the FY1986-FY1988 period, and larger savings thereafter. An
alternative COLA cutback proposal emerged shortly thereafter, as part of
a substitute deficit-reduction package developed by the Administration and
the Senate Republican leadership. Instead of freezing COLAs in the
affected federal retirement programs for 1 year, it would have limited the
COLAs for the next 3 years to 2% per year plus any amount by which
inflation exceeded the Administration’s assumptions (its assumptions at
that time suggested that inflation would hover in the high 3% or low 4%
range). It further included a guarantee provision under which the affected
COLAs could not be less than 2%. It, too, would have resulted in about
$22 billion in Social Security savings over the following 3 years (as well
as higher savings in later years).
a.When the Senate took up the Budget Committee’s first budget resolution, it
rejected both the COLA freeze and the alternative COLA limitation by agreeing
on May 1, 1985, by a vote of 65 (19-R, 46-D) to 34 (33-R, 1-D)351 to an
amendment by Senator Dole (R-KS), for Senators Hawkins (R-FL) and
D’Amato (R-NY), to provide for full funding of Social Security COLAs.
b.However, on May 10, 1985, after considering many amendments, the Senate
adopted by a vote of 50 (49-R, 1-D) to 49 (4-R, 45-D)352 an entirely revised
budget package, introduced by Senator Dole, which incorporated the original
COLA freeze recommended by the Committee.
c.Subsequently, the Senate considered an amendment by Senator Moynihan (D-
NY) to provide a full Social Security COLA in January 1986, but it was tabled
by a vote of 51 (49-R, 2-D) to 47 (3-R, 44-D).353
d.The final budget resolution, passed by a voice vote, assumed later enactment of
the 1986 COLA freezes, including one affecting Social Security.
2. House Action. The House-passed version of the FY1986 first budget
resolution, H.Con.Res. 152, assumed that full COLAs would be paid in all federal
benefit programs.
350 Congressional Quarterly Almanac. 99th Congress. 1st Sess. 1985. Vol. XLT. p. 447.
351 Congressional Record. May 1, 1985. Senate. Roll call no. 35, not voting 1. p. 10075.
352 Congressional Record. May 9, 1985. Senate. Roll call no. 72, not voting 2. p. 11475.
The initial vote was 49 to 49, which necessitated that Vice President Bush cast the tie-
breaking vote.
353 Congressional Record. May 9, 1985. Senate. Roll call no. 73, not voting 2. p. 11477.
a.On May 22, 1985, the House rejected an amendment by Mr. Dannemeyer (R-
CA) to limit Social Security COLAs to 2% per year for the 3-year period
FY1986-FY1988 by a vote of 382 (135-R, 247-D) to 39 (39-R, 0-D)354
b.On May 23, 1985, the House also rejected by a vote of 372 (165-R, 207-D) to
56 (15-R, 41-D) an amendment offered by Representative Leath (D-TX) to
freeze 1986 COLAs for Social Security, federal retirement, and veterans’
compensation while adding back 20% of the anticipated savings to programs
that aid needy elderly and disabled people.355
c.Provisions of the House-passed resolution were inserted in S.Con.Res. 32, in
lieu of the Senate-passed measures, which was approved by a vote of 258 (24-R,
3. Conference Action. Conferees for the House and Senate met throughout
June and July 1985 to work out an agreement on a deficit reduction package. Among
the number of ideas that surfaced were proposals to delay the Senate-passed COLA
freezes until 1987, means test the COLAs, make both the COLAs and adjustments
to income tax brackets effective every other year (instead of annually), and increase
the amount of Social Security benefits that would be subject to income taxes.
Ultimately, however, agreement could not be reached on any form of Social Security
constraint, and the conference agreement on the First Concurrent Resolution on the
Budget for FY1986, passed on August 1, 1985, did not assume any such savings.
FF. P.L. 99-509, The Omnibus Budget Reconciliation Act of
1986
President Reagan signed H.R. 5300, the Omnibus Budget Reconciliation Act of
1986, on October 21, 1986. During 1986, inflation slowed to a rate that made it
unlikely that it would reach the 3% threshold necessary to provide a COLA in that
year. P.L. 99-509 permanently eliminated the 3% requirement, which enabled a 1.3%
COLA to be authorized for December 1986.
1. Senate Action. The Senate Finance Committee, as part of its budget
provisions incorporated in S. 2706, the Omnibus Budget Reconciliation Act of 1986,
included a measure that would have provided a Social Security COLA in January
1987 no matter how low inflation turned out to be, i.e., it permanently eliminated the
a.The Senate approved S. 2706 on September 20, 1986 by a vote of 88 (50-R, 38-357
D) to 7 (0-R, 7-D).
354 Congressional Record. May 22, 1985. House. Roll call no. 124, not voting 13. p.
355 Congressional Record. May 23, 1985. House. Roll call no. 129, not voting 5. p. 13387.
356 Congressional Record. May 23, 1985. House. Roll call no. 131, not voting 6. p. 13407.
357 Congressional Record. September 20, 1985. Senate. Roll call no. 277, not voting 5. p.
2. House Action. The House Ways and Means Committee, as part of its
budget reconciliation provisions incorporated in H.R. 5300, its version of the
Omnibus Budget Reconciliation Act of 1986, included a similar measure.
a.The House passed H.R. 5300 with this measure on September 24, 1986 by a
vote of 309 (99-R, 210-D) to 106 (71-R, 35-D).358
3. Conference Action. The conference report on H.R. 5300, including the
COLA provision, was approved by both Houses on October 17, 1986, by a vote of
R, 15-D) in the Senate.359
GG. P.L. 100-203, The Omnibus Budget Reconciliation Act of
1987
H.R. 3545, the Omnibus Budget Reconciliation Act of 1987, was signed into
law on December 22, 1987, by President Reagan. Several of its provisions affected
Social Security. P.L. 100-203: extended FICA coverage to military training of
inactive reservists, the employer’s share of all cash tips, and several other categories
of earnings; lengthened from 15 to 36 months the period during which a disability
recipient who returns to work may become automatically reentitled to benefits; and
extended the period for appeal of adverse disability decisions through 1988.
1. House Action. H.R. 3545 was a bill to meet the deficit reduction targets
set by the FY1988 budget resolution (H.Con.Res. 93). Earlier, in July, the Ways and
Means Committee also had approved changes in Social Security. Two of these
provisions — extending coverage to military training of inactive reservists and group
term life insurance — had been requested by President Reagan. In addition, the
Committee agreed to lengthen from 15 to 36 months the period during which a
disability recipient who returns to work may become automatically reentitled to
benefits, to extend the period for appeal of adverse disability decisions through 1988,
and to cover certain agricultural workers, children and spouses in family businesses.
a.The house passed H.R. 3545 on October 29, 1987, by a vote of 206 (1-R, 205-
D) to 205 (164-R, 41-D).360
2. Senate Action. When the Finance Committee approved H.R. 3545 on
December 3, 1987, it included the House Social Security coverage provisions.
358 Congressional Record. September 24, 1986. House. Roll call no. 408, not voting 17.
p. 26024.
359 Congressional Record. October 17, 1986. House. Roll call no. 487, not voting 57. p.
32978 and Congressional Record. October 17, 1986. Senate. Roll call no. 358, not voting
360 Congressional Record. October 29, 1987. House. Roll call no. 392, not voting 22. p.
a.On December 10, 1987, the Senate rejected an amendment by Ms. Kassebaum
(R-KS) that would have limited the 1988 Social Security COLA to 2%, by a
vote of 71 (34-R, 37-D) to 25 (11-R, 14-D).361
b.On December 11, 1987, the Senate approved H.R. 3545 by a voice vote.
3. Conference Action. The Conference Committee generally accepted the
House-passed version of H.R. 3545.
a.On December 21, 1987, the House passed the Conference Report by a vote of
b.On December 21, 1987, the Senate passed the Conference Report by a vote of
HH. P.L. 100-647, The Technical and Miscellaneous Revenue
Act of 1988
On November 10, 1988, President Reagan signed H.R. 4333, the Technical and
Miscellaneous Revenue Act of 1988. In addition to various tax measures the bill
contained several provisions affecting Social Security. Among these, H.R. 4333:
provided interim benefits to individuals who have received a favorable decision upon
appeal to an Administrative Law Judge but whose case has been under review by the
Appeals Council for more than 110 days; extended the existing provision for
continued payment of benefits during appeal; denied benefits to Nazis who are
deported; and lowered the number of years of substantial Social Security-covered
earnings that are needed to begin phasing out the windfall benefit formula (which
applies to someone receiving a pension from noncovered employment) from 25 to
1. House Action. On July 14, 1988, the Ways and Means Committee
approved a “tax corrections” bill, H.R. 4333, that also included some measures
affecting Social Security.
a.The house passed H.R. 4333 on August 4, 1988, by a vote of 380 (150-R, 230-
D) to 25 (19-R, 6-D).364
2. Senate Action. The Finance Committee adopted about half of the House
Social Security provisions.
361 Congressional Record. December 10, 1987. Senate. Roll call no. 405, not voting 4. p.
362 Congressional Record. December 21, 1987. House. Roll call no. 508, not voting 15.
p. 37088.
363 Congressional Record. December 21, 1987. Senate. Roll call no. 419, not voting 11.
p. 37712.
364 Congressional Record. August 4, 1988. House. Roll call no. 266, not voting 26. p.
a.The Senate approved H.R. 4333 on October 11, 1988 by a vote of 87 (38-R, 49-
D) to 1 (0-R, 1-D).365
3. Conference Action. The Conference Committee generally accepted the
House-passed version of H.R. 4333.
a.On October 21, 1988, the House passed the Conference Report by a vote of 358
(150-R, 208-D) to 1 (0-R, 1-D).366
b.On October 21, 1988, the Senate passed the conference report by a voice vote.
II. P.L. 101-239, The Omnibus Budget Reconciliation Act of
1989
On December 19, 1989, President Bush signed H.R. 3299, the Omnibus Budget
Reconciliation Act of 1989. Among other things, its Social Security provisions:
extended benefits to children adopted after the worker became entitled to benefits,
regardless of whether the child was dependent on the worker before the worker’s
entitlement; again extended the existing provision for continued payment of benefits
during appeal; increased the calculation of average wages, used for purposes of
computing of benefits and the maximum amount of earnings subject to FICA tax, by
including deferred compensation; and, beginning in 1990, required that SSA provide
estimates of earnings and future benefits to all workers over age 24.
Among these was a provision making SSA an independent agency, raising the
Special Minimum benefit by $35 a month, increasing the earnings test limits for
recipients over age 64, extending benefits to children adopted after the worker
became entitled to benefits, regardless of whether the child was dependent on the
worker before the worker’s entitlement, again extending the existing provision for
continued payment of benefits during appeal, and including deferred compensation
in the determination of average wages for purposes of determining benefits and the
maximum amount of earnings subject to the FICA tax.
a.On October 5, 1989, the House passed H.R. 3299 by a vote of 333 (R-146, D-
3299 on October 3, 1989. Like the House version, it included an increase in the
maximum amount of earnings subject to the FICA tax, but specifically earmarked the
revenue therefrom to pay for proposed increases in the earnings test limits. It also
365 Congressional Record. October 11, 1988. Senate. Roll call no. 366, not voting 12. p.
366 Congressional Record. October 21, 1988. House. Roll call no. 463, not voting 72. p.
367 Congressional Record. October 5, 1989. House. Roll call no. 274, not voting 8. p.
approved making SSA an independent agency, but with a single administrator as
opposed to a 3-person board in the House version. However, because it was thought
that a “clean bill” would improve chances of passage, the bill was stripped of its
Social Security provisions before it reached the floor.
a.The senate approved its version of H.R. 3299 on October 13, 1989, by a vote of
3. Conference Action. In conference, most of the House provisions were
accepted (the major exclusion was making SSA an independent agency). Although
neither version of H.R. 3299 included it, a provision was added that, beginning in
1990, required that SSA provide estimates of earnings and future benefits to all
workers over age 24.
a.On November 22, 1989 (legislative day November 21), the House approved the
conference report by a vote of 272 (R-86, D-186) to 128 (R-81, D-47).369 The
Senate approved it the same day by a voice vote.
JJ. P.L. 101-508, The Omnibus Budget Reconciliation Act of
1990
On November 5, 1990, President Bush signed H.R. 5835, the Omnibus Budget
Reconciliation Act of 1990. Among its Social Security provisions, it: made
permanent a temporary provision, first enacted in 1984 and subsequently extended,
that provides the option for recipients to choose to continue to receive disability and
Medicare benefits while their termination is being appealed; liberalized the definition
of disability for disabled widow(er)s by making it consistent with that for disabled
workers; extended benefits to spouses whose marriage to the worker is otherwise
invalid, if the spouse was living with the worker before he or she died or filed for
benefits; removed the operation of the trust funds from budget deficit calculations
under the Gramm-Rudman-Hollings Act; established separate House and Senate
procedural safeguards to protect trust fund balances; extended coverage to employees
of state and local governments who are not covered by a retirement plan; and raised
the maximum amount of earnings subject to HI taxes to $125,000, effective in 1991,
with raises thereafter indexed to increases in average wages.
1. House Action. In 1990, the congressional agenda was dominated by the
debate over how to reduce a large budget deficit, which, under the Gramm-Rudman
Hollings (GRH) sequestration rules, would have required billions of dollars of cuts
in many federal programs. The administration’s FY1991 budget contained several
Social Security measures, the most prominent of which was to extend Social Security
coverage to state and local government workers not covered by a retirement plan.
The Ways and Means Social Security Subcommittee included some of them in a
368 Congressional Record. October 13, 1989. Senate. Roll call no. 243, not voting 6. p.
369 Congressional Record. November 21, 1989. House. Roll call no. 379, not voting 33.
p. 31127.
package of Social Security provisions it forwarded to the full committee. For several
months budget negotiations stalled, as the democratic majority in Congress disagreed
with the administration’s position that the deficit should be reduced entirely with
spending cuts. As a result of a budget “summit” between congressional and
administration leaders, an agreement was reached in which the President would put
tax increases on the table and the Congress would consider spending cuts in
entitlements, including Social Security and Medicare. The resulting bill reported
from the Budget Committee on October 15, H.R. 5835, extended Social Security
coverage to state and local government workers not covered by a retirement plan and
raised the maximum amount of earnings subject to HI taxes to $100,000, effective
in 1991. However, the same day the Ways and Means Committee reported out H.R.
5828, a bill making miscellaneous and technical amendments to the Social Security
Act, that incorporated most of the provisions that had earlier been approved by the
Social Security Subcommittee.
a.On October 16, 1990, the House approved H.R. 5835 by a vote of 227 (10-R,
2. Senate Action. During 1990, the debate about Social Security was largely
dominated by a proposal by Senator Moynihan (D-NY) to cut the Social Security
payroll tax and return the program to true pay-as-you-go financing. The driving force
behind the proposal was the growing realization that the rapid rise in Social Security
yearly surpluses, caused by payroll tax revenues that exceeded the program’s
expenditures, were significantly reducing the size of the overall federal budget
deficit. This had led to charges that the Social Security trust funds were being
“raided” to finance the rest of government and “masking” the true size of the deficit.
In S. 3167, Senator Moynihan proposed that the payroll tax rate be scheduled to fall
and rise with changes in the program’s costs.
a.On October 10, 1990, Senator Moynihan asked that the Senate vote on S. 3167.
While the Senate leadership agreed to bring the bill to the floor, a point of order
was raised against it on the basis that it violated the Budget Act. Although a
majority of Senators voted to override the point of order, 54 (R-12, D-42) to 44
(31-R, 13-D), the measure fell short the 60 votes required.371
b.When the Senate considered H.R. 5835 on October 18, 1990, it accepted by a
vote of 98 (43-R, 55-D) to 2 (2-R, 0-D) an amendment by Senators Hollings (D-
SC) and Heinz (R-PA) to remove Social Security from GRH budget deficit
cal cul at i ons. 372
370 Congressional Record. October 16, 1990. House. Roll call no. 475, not voting 3. p.
371 Congressional Record. October 10, 1990. Senate. Roll call no. 262, not voting 2. p.
372 Congressional Record. October 18, 1990. Senate. Roll call no. 283, not voting 0. p.
c.On October 19, 1990 (legislative day October 18), the Senate passed the budget
reconciliation bill by a vote of 54 (23-R, 31-D) to 46 (22-R, 24-R).373
a.On October 27, 1990 (legislative day October 26), the House passed the
conference report on H.R. 5835 by a vote of 228 (47-R, 181-D) to 200 (126-R,
b.On October, 27, 1990, the Senate passed the conference report by a vote of 54
(19-R, 35-D) to 45 (25-R, 20-D)375
KK. P.L. 103-66, The Omnibus Budget Reconciliation Act of
1993
On August 10, 1993, President Clinton signed H.R. 2264, the Omnibus Budget
Reconciliation Act of 1993. Effective in 1994, H.R. 2264: made up to 85% of Social
Security benefits subject to the income tax for recipients whose income plus one-half
of their benefits exceed $34,000 (single) and $44,000 (couple); and eliminated the
maximum taxable earnings base for HI, i.e., subjected all earnings to the HI tax,
effective in 1994.
As part of his plan to cut the Federal fiscal deficit, President Clinton proposed
in his first budget that the proportion of benefits subject to taxation should be
increased from 50% to 85%, effective in 1994. His budget document said this would
“move the treatment of Social Security and railroad retirement Tier I benefits toward
that of private pensions” and would generate $32 billion in new tax revenues over
five years. The proceeds would not be credited to the Social Security trust funds, as
under current law, but to the Medicare Hospital Insurance program, which had a less
favorable financial outlook than did Social Security. Doing so also would have
avoided procedural obstacles that could have been raised in the budget reconciliation
process. The budget also proposed that the maximum taxable earnings base for HI
be eliminated entirely beginning in 1994.
Both proposals, especially the increase in the taxation of benefits, were opposed
vigorously by the Republican minority. Critics maintained that the increase was
unfair as it changed the rules in the middle of the game, penalizing recipients who
relied on old law and who cannot change past work and savings decisions.
Regardless of abstract arguments about tax principles, many recipients regard
increased taxation as simply a reduction in the benefits they had been promised.
They regarded taxation of benefits as an indirect means test, which would weaken the
“earned right” nature of the program, and make it more like welfare, where need
373 Congressional Record. October 18, 1990. Senate. Roll call no. 292, not voting 0. p.
374 Congressional Record. October 26, 1990. House. Roll call no. 528, not voting 5. p.
375 Congressional Record. October 27, 1990. Senate. Roll call no. 326, not voting 1. p.
determines the level of benefits. Finally, they maintained that it grossly distorts
marginal tax rates and provides a strong disincentive for many recipients to work.376
1. House Action. H.Con.Res. 64, the FY1994 Concurrent Budget
Resolution, included the additional revenue from the President’s proposal.
a.On March 18, 1993, the House passed H.Con.Res. 64 by a vote of 243 (0-R,
the President’s proposal.
2. Senate Action. The Senate devoted six days of debate to H.Con.Res. 64
at the end of March.
a.On March 24, 1993, the Senate rejected by a vote of 47 (43-R, 4-D) to 52 (0-R,
52-D) an amendment by Senator Lott (R-MS) that would have deleted from the
resolution the revenue projected from the President’s proposal.378
b.On March 24, 1993, the Senate approved, by a vote of 67 (12-R, 55-D) to 32
(31-R, 1-D), an amendment by Senators Lautenberg (D-NJ) and Exon (D-NE)
expressing the sense of the Senate that the revenues set forth in the resolution
assume that the Finance Committee would make every effort to find alternative
sources of revenue before imposing additional taxes on the Social Security
benefits of recipients with threshold incomes of less than $32,000 (single) and
$40,000 (couples). The thresholds for taxing 50% of benefits were to remain
at the current law levels of $25,000 and $32,000.379
c.On March 25, 1993, the Senate approved H.Con.Res. 64 by a vote of 54 (0-R,
3. Conference Action. On March 31, 1993, the House approved the
conference report on H.Con.Res. 64 by a vote of 240 (0-R, 239-D, 1-I) to 184 (172-
376 Subsequently, after the Republicans gained control of the House of Representatives, the
House twice passed legislation that would repeal the 1993 increase in taxation of benefits.
Repeal of the 1993 provision was part of the Republican “Contract with America,” and was
approved by the House as part of the omnibus budget reconciliation bill (H.R. 2491) but was
not included in the final law. On July 27, 2000, the House of Representatives approved H.R.
4865, which, effective in 2001, would repeal the 1993 provision, thus lowering the
maximum amount of benefits subject to taxation from 85% to 50%, and replace the resulting
reduced revenue to Medicare with general fund transfers. In neither instance were these
measures approved by the Senate.
377 Congressional Record. March 18, 1993. House. Roll call no. 85, not voting 4. p. 5674.
378 Congressional Record. March 24, 1993. Senate. Roll call no. 57, not voting 1. p. 6142.
379 Congressional Record. March 24, 1993. Senate. Roll call no. 58, not voting 1. p. 6149.
380 Congressional Record. March 25, 1993. Senate. Roll call no. 83, not voting 1. p. 6408.
R, 12-D).381 On April 1, 1993, the Senate approved the conference report by a vote
of 55 (0-R, 55-D) to 45 (43-R, 2-D).382 It included the sense of the Senate resolution.
4. House Action. On May 13, 1993, by a party-line vote of 24-14, the House
Committee on Ways and Means approved the President’s proposal, but modified it
so that the additional proceeds would be credited to the General Fund instead of to
Medicare. This measure was included in H.R. 2264, the 1993 Omnibus Budget
Reconciliation Act.
a.On May 27, 1993, the House passed H.R. 2264 by a vote of 219 (0-R, 218-D,383
5. Senate Action. On June 18, 1993, by a party-line vote of 11-9, the
Finance Committee approved H.R. 2264, but included the Lautenberg-Exon
amendment to raise the taxation thresholds to $32,000 (single) and $42,000 (couple).
a.On June 24, 1993, the Senate rejected, by a vote of 46 (41-R, 5-D) to 51(1-R,
50-D), an amendment by Senator Lott to delete the taxation of benefits
provision.384
b.It also rejected, by a vote of 46 (3-R, 43-D) to 51 (40-R, 11-D) an amendment
by Senator DeConcini to increase the 85% thresholds to $37,000 (single) and
$54,000 (couple),385 and, by a vote of 41 (40-R, 1-D) to 57 (3-R, 54-D) an
amendment by Senator McCain to direct that the proceeds of increased taxation
of benefits be credited to the Social Security trust funds.386
c.On June 24, 1993, the Senate approved, by a vote of 50 (0-R, 50-D) to 49 (43-R,
6-D) the Budget Reconciliation bill. It included the Lautenberg-Exon
amendment creating second-tier thresholds of $32,000 and $40,000.387
6. Conference Action. On July 14, 1993, the House adopted, by a vote of
415 to 0, an amendment by Representative Sabo (D-MN) to instruct its conferees on
the bill to accept the Senate version of taxation of benefits.388
381 Congressional Record. March 31, 1993. House. Roll call no. 127, not voting 6. p.
382 Congressional Record. April 1, 1993. Senate. Roll call no. 94, not voting 0. p. 7215.
383 Congressional Record. May 27, 1993. House. Roll call no. 199, not voting 0. p. 11952.
384 Congressional Record. June 24, 1993. Senate. Roll call no. 169, not voting 3. p. 14028.
385 Congressional Record. June 24, 1993. Senate. Roll call no. 172, not voting 2. p. 14069.
386 Congressional Record. June 24, 1993. Senate. Roll call no. 184, not voting 2. p. 14107.
387 Congressional Record. June 24, 1993. Senate. Roll call no. 190, not voting 2. p. 14172.
The initial vote was 49 to 49, which necessitated that Vice President Gore cast the tie-
breaking vote.
388 Congressional Record. July 14, 1993. House. Roll call no. 329, not voting 19. p.
a.When the House and Senate versions of the budget package were negotiated in
conference, the conferees modified the Senate taxation of Social Security
benefits provision by setting the second tier thresholds at $34,000 (single) and
$44,000 (couple). The measure was included in the final version of the
reconciliation bill passed by the House on August 5, 1993, by a vote of 218 (0-
R, 217-D, 1-I) to 216 (175-R, 41-D).389
b.On August 6, 1993, the Senate passed H.R. 2264 by a vote of 51 ( 0-R, 51-D)
to 50 (44-R, 6-D).390
LL. P.L. 103-296, The Social Security Administrative Reform
Act of 1994
President Clinton signed H.R. 4277, the Social Security Administrative Reform
Act of 1994, on August 15, 1994. P.L. 103-296: established the Social Security
Administration (SSA) as an independent agency, effective March 31, 1995; and
restricted DI and SSI benefits payable to drug addicts and alcoholics by creating
sanctions for failing to get treatment, limiting their enrollment to 3 years, and
requiring that those receiving DI benefits have a representative payee (formerly
required only of SSI recipients). Representatives of the Clinton Administration
initially opposed making SSA an independent agency, but President Clinton
supported H.R. 4277’s final passage.
Interest in making SSA independent began in the early 1970s, when Social
Security’s impact on fiscal policy was made more visible by including it in the
federal budget. During congressional budget discussions in the early 1980s
proponents of independence wanted to insulate Social Security from benefit cuts
designed to meet short term budget goals rather than policy concerns about Social
Security. Many argued that making the agency independent would help insulate it
from political and budgetary discussions, would lead to better leadership, and
reassure the public about Social Security’s long-run survivability.
Opponents argued that Social Security’s huge revenue and outlays should not
be isolated from policy choices affecting other HHS social programs, and that its
financial implications for the economy and millions of recipients should be evaluated
in conjunction with other economic and social functions of the government. They
further believed that making SSA independent would not necessarily resolve its
administrative problems, which were heavily influenced by ongoing policy changes
to its programs resulting from legislation and court decisions.
Starting in 1986, a number of attempts were made in Congress to make SSA
independent. Various Administrations generally opposed the idea, and a
disagreement persisted between the House and Senate over how such an agency
389 Congressional Record. August 5, 1993. House. Roll call no. 406, not voting 0. p.
390 Congressional Record. August 6, 1993. Senate. Roll call no. 247, not voting 0. p.
14107. The initial vote was 50 to 50, which necessitated that Vice President Gore cast the
tie-breaking vote.
should be administered. The House preferred an approach under which an
independent SSA would be run by a three-member bipartisan board; the Senate
preferred an approach where it would be run by a single administrator.
1. House Action. On May 12, 1994, the Ways and Means Committee
reported out H.R. 4277 (incorporating the three-member bipartisan board approach),
introduced by Representative Jacobs (D-IN).
a.The House passed H.R. 4277 on May 17, 1994, by a vote of 413-0.391
2. Senate Action. On January 25, 1994, the Senate Finance Committee
reported out S. 1560 (incorporating the single-administrator approach), introduced
by Senator Moynihan (D-NY).
a.The Senate passed S. 1560 by voice vote on March 2, 1994.
b.On May 23, 1994, the Senate approved H.R. 4277, after striking its language
and substituting that of S. 1560, by voice vote.
under which SSA would be run by a single administrator appointed for a 6-year term,
supported by a seven-member bipartisan advisory board.
a.The Senate passed the agreement by voice vote on August 5, 1994.392
b.The House passed the agreement on August 11, 1994, by a vote of 431-0.
MM. P.L. 103-387, The Social Security Domestic Reform Act
of 1994
President Clinton signed H.R. 4278, Social Security Domestic Reform Act of
1994, on October 22, 1994. H.R. 4278: raised the threshold for Social Security
coverage of household employees from remuneration of $50 in wages a quarter to
$1,000 a year, which would rise thereafter with the growth in average wages; and
reallocated taxes from the OASI fund to the DI fund.
In early 1993, the issue of coverage of domestic workers burst into public
awareness when several Cabinet nominees revealed that they had failed to report the
wages they had paid to childcare providers. Subsequent media scrutiny made it
apparent that under-reporting of household wages was common. It also highlighted
that householders were supposed to be reporting even occasional work such as
babysitting and lawn mowing. As the threshold had not been changed for 43 years,
the question naturally arose of whether it should be raised.
391 Congressional Record. May 17, 1994. House. Roll call no. 177, not voting 20. p.
392 Congressional Record. August 11, 1994. House. Roll call no. 392, not voting 3. p.
1. House Action. Several measures were introduced in the 103rd Congress
that would have raised the threshold by varying amounts. On March 22, 1994, Mr.
Andrew Jacobs (D-IN) introduced H.R. 4105, which would have raised the threshold
to $1,250 a year in 1995, to be indexed thereafter to increases in average wages.
a.This measure was included in H.R. 4278, approved by the House on May 12,393
it struck the House language and substituted the text of S. 1231, a bill by Senator
Moynihan (D-NY) which would have raised the annual threshold to the same level
as that needed to earn a quarter of coverage ($620 in 1994) and exempted from Social
Security taxes the wages paid to domestic workers under the age of 18.
a.The Senate passed the revised version of H.R. 4278 on May 25, 1994 by
unanimous consent.
3. Conference Action. On October 5, 1994, conferees agreed to a measure
that raised the threshold for Social Security coverage of household workers to
$1,000, effective in 1994. The measure also provided that the threshold would rise
in the future, in $100 increments, in proportion to the growth in average wages in the394
economy (it rose to $1,100 in 1998, $1,200 in 2000, and $1,300 in 2001).
a.On October 6, 1994, the conference report was approved in the House by a vote
of 423-0.
b.The same day, the Senate approved the conference report by unanimous
consent.
NN. P.L. 104-121, The Senior Citizens Right to Work Act of
1996
On March 29, 1996, President Clinton signed H.R. 3136, the Senior Citizens
Right to Work Act of 1996. H.R. 3136: raised the annual earnings test exempt
amount, for recipients who have attained the full retirement age, over a period of
seven years, reaching $30,000 in 2002; prohibited DI and SSI eligibility to
individuals whose disability is based on drug addiction or alcoholism; tightened
eligibility requirements for entitlements to benefits as a stepchild; and, as a way to
produce program savings that would help compensate for the increased costs to the
Social Security system due to liberalizing the earnings test, provided funds for
additional continuing disability reviews.
On September 27, 1994, 300 Republican congressional candidates presented a
“Contract with America” that listed 10 proposals that they would pursue if elected.
393 Congressional Record. May 12, 1994. House. Roll call no. 169, not voting 15. p.
394 Congressional Record. October 6, 1994. House. Roll call no. 494, not voting 11. p.
One of the proposals, the “Senior Citizens Equity Act,” included a measure to
increase the earnings test limits, for those over age 64, over a period of 5 years,
reaching $30,000 in 2000. After the Republican victory in the election, the Senior
Citizens Equity Act was sponsored by 131 Members in H.R. 8, introduced January
4, 1995. Although the House approved the measure as part of H.R. 1215, it was not
included in the Balanced Budget Reconciliation bill (H.R. 2491) passed by the
Congress on November 20, 1995.
1. House Action. On November 28, 1995, the Social Security Subcommittee
of the Ways and Means Committee approved H.R. 2684, the Senior Citizens Right
to Work Act, introduced by Chairman Bunning, (R-KY) that gradually would
increase the earnings test limits for those aged 65-69 to $30,000 in 2002. The full
committee approved H.R. 2684 by a vote of 31-0 on November 30, 1995.
a.The House approved H.R. 2684 on December 5, 1995, by a vote of 411 (230-R,
On March 21, 1996, reportedly with the agreement of the Administration, a
modified version of H.R. 2684 was included in H.R. 3136, the Contract with
America Advancement Act of 1996, introduced by Mr. Archer (D-TX). H.R. 3136,
also included an increase in the debt ceiling and other measures. The part of H.R.
3136 relating to the earnings test was similar to H.R. 2684, but modified to slow the
rise in the exempt amounts during the first 5 years of the phase-in.
a.On March 28, 1996, H.R. 3136 was passed by the House by a vote of 328 (201-
R, 127-D) to 91 (30-R, 60-D, 1-I).396
2. Senate Action. On December 14, 1995, the Senate Committee on Finance
approved S. 1470, a bill similar to H.R. 2684.
a.On March 28, 1996, H.R. 3136 was passed by the Senate by unanimous consent.
OO. P.L. 106-170, The Ticket to Work and Work Incentives
Improvement Act of 1999
President Clinton signed H.R. 1180, the Ticket to Work and Work Incentive Act
of 1999, on December 17, 1999. H.R. 1180 provided disabled recipients with
vouchers they can use to purchase rehabilitative services from public or private
providers and extended Medicare coverage for up to 4.5 additional years for disabled
recipients who work.
In the 1990s, there was a growing movement to mitigate what was seen as a
fundamental dilemma faced by many disabled Social Security recipients. The
395 Congressional Record. December 5, 1995. House. Roll call no. 837, not voting 17. p.
H13974.
396 Congressional Record. March 28, 1996. House. Roll call no. 102, not voting 12. p.
dilemma was that, while the disabled were encouraged to try to leave the Social
Security rolls by attempting to work, in doing so they faced a limited choice in
seeking rehabilitation services and a potentially serious loss of Medicare and
Medicaid benefits. Proponents of providing greater work opportunity argued that
incentives for the disabled to attempt to work should be enhanced.
a.On October 19, 1999, the House approved, H.R. 1180, The Ticket to Work and
Work Incentives Improvement Act of 1999, introduced By Representative Vic
Lazio (R-NY), by a vote of 412 (206-R, 205-D, 1-I) to 9 (9-R, 0-D).397
a.On June 16, 1999, the Senate passed a similar bill, S. 331, the Work Incentives
Improvement Act of 1999, introduced by Senator James S. Jeffords (R-VT), by
a vote of 99-0.398On October 21, 1999, the Senate passed H.R. 1180, after
striking its language and substituting that of S. 331, by unanimous consent.
a.On November 18, 1999, the House adopted the conference report by a vote of
b.On November 19, 1999, the Senate adopted the conference report by a vote of
PP. P.L. 106-182, The Senior Citizens Right to Work Act
President Clinton signed H.R. 5, the Senior Citizens Right to Work Act, on
April 7, 2000. H.R. 5 eliminated the earnings test for recipients who have attained
the full retirement age, effective in 2000.
The earnings test has always been one of the most unpopular features of the
Social Security program. Critics said it was unfair and inappropriate to impose a
form of “means” test for a retirement benefit that has been earned by a lifetime of
contributions to the program, that it has a strong negative effect on work incentives,
and that it can hurt elderly individuals who need to work to supplement their Social
Security benefits. Defenders of the provision said that it is a reasonable means of
executing the purpose of Social Security. Because the system is social insurance that
protects workers from loss of income due to the retirement, death, or disability of the
397 Congressional Record. October 19, 1999. House. Roll call no. 513, not voting 12. p.
398 Congressional Record. June 16, 1999. Senate. Roll call no. 169, not voting 1. p. S7064.
399 Congressional Record. November 18, 1999. House. Roll call no. 611, not voting 15.
p. H12832.
400 Congressional Record. November 19, 1999. Senate. Roll call no. 372, not voting 4. p.
S14986.
worker, they consider it appropriate to withhold benefits from workers who show by
their substantial earnings that they have not in fact “retired.” Also, they argued that
eliminating or significantly liberalizing the benefit would primarily help those who
do not need help, i.e., the better-off.
However, over the years probably the main impediment to eliminating the
earnings test was its negative effect on the financial status of the program and on
current federal budgets, which perennially were in deficit. By 2000, the federal
budget was running large surpluses, so major alterations to the test were deemed
affordable. Also, it was projected that eliminating the test would have no negative
impact on Social Security’s long-range financing because of offsetting savings. The
ground work for this offsetting effect had been laid in 1983, when Congress
increased the Delayed Retirement Credit (DRC). The DRC increases benefits for
retirees by a certain percentage for each month they do not receive benefits after they
attain their full retirement age. The 1983 legislation provided for a long phase-in of
the increase in the DRC, so that its ultimate rate would not be achieved until 2008.
At that point it would be “actuarial,” meaning that the additional benefits a person
would receive over his or her lifetime due to the DRC would be approximately equal
to the value of the benefits lost due to the earnings test. Thus, the long-range cost of
eliminating the earnings test for those above the full retirement age would be offset
by the savings produced by fewer payments of DRCs. Because there was no threat
to Social Security’s long-range solvency and the short range costs were judged to be
affordable, the momentum to repeal the test for those at or over the retirement age
was overwhelming.
a.On March 1, 2000, the House approved H.R. 5, a bill that would eliminate the
earnings test for recipients who have attained the full retirement age, introduced
by Representative Sam Johnson (R-TX), by a vote of 422-0.401
a.On March 22, 2000, the Senate approved H.R. 5, with a modification to the
monthly exempt amounts in the year of attaining the full retirement age, by a
vote of 100-0.402
a.On March 28, 2000, the house approved the Senate version of H.R. 5 by a vote
of 419-0.403
401 Congressional Record. March 1, 2000. House. Roll call no. 27, not voting 13. p. H603.
402 Congressional Record. March 22, 2000. Senate. Roll call no. 42, not voting 0. p.
S1540.
403 Congressional Record. March 28, 2000. House. Roll call no. 79, not voting 16. p.
H1450.
QQ. P.L. 108-203, The Social Security Protection Act of 2004
President Bush signed H.R. 743, the Social Security Protection Act of 2004, on
March 2, 2004. The measure included various provisions designed to reduce fraud
and abuse in the Social Security404 and Supplemental Security Income (SSI)
programs. Among other changes, H.R. 743 imposed stricter standards on individuals
and organizations that serve as representative payees for Social Security and SSI
recipients; made nongovernmental representative payees liable for misused funds and
subjected them to civil monetary penalties; tightened restrictions on attorneys who
represent Social Security and SSI disability claimants; limited assessments on
attorney fee payments; prohibited fugitive felons from receiving Social Security
benefits; modified the “last day rule” under the Government Pension Offset
provision; and required certain noncitizens to have authorization to work in the
United States at the time a Social Security Number is assigned, or at some later time,
to gain insured status under the Social Security program. Several major provisions
of the new law are described below.405
The Social Security Administration (SSA) may designate a “representative
payee” to accept monthly benefit payments on behalf of Social Security and SSI
recipients who are physically or mentally incapable of managing their own funds, or
on behalf of children under age 18. Before P.L. 108-203, SSA was required to
reissue benefits misused by an individual or organizational representative payee only
in cases where the Commissioner of Social Security found that SSA negligently
failed to investigate or monitor the payee. The new law eliminated the requirement
that the reissuance of benefits be subject to a finding of negligence on the part of
SSA. As a result, SSA is required to reissue any benefits misused by an individual
representative payee who represents 15 or more recipients, or by an organizational
representative payee. In addition, the new law made nongovernmental representative
payees (i.e., those other than federal, state, and local government agencies) liable for
the reimbursement of misused funds. Under the new law, SSA has the authority to
impose a civil monetary penalty (up to $5,000 for each violation) and an assessment
(up to twice the amount of misused benefits) on representative payees who misuse
benefits. The new law included a number of other provisions aimed at strengthening
the accountability of representative payees.
Social Security and SSI disability claimants may choose to have an attorney or
other qualified individual represent them in proceedings before SSA, and the
claimant representative may charge a fee for his or her services. The fee, which is
subject to limits, must be authorized by SSA. If a Social Security disability claimant
is awarded past-due benefits and his or her representative is an attorney, SSA
withholds the attorney’s fee payment from the benefit award and sends the payment
directly to the attorney. To cover the administrative costs associated with the fee
404 The Social Security program is also known by its formal name — the Old-Age,
Survivors, and Disability Insurance (OASDI) program.
405 For more information, see the summary of P.L. 108-203 available on the SSA website at
[http://www.ssa.gov/legislation/legis_bulletin_030404.html], and CRS Report RL32089,
The Social Security Protection Act of 2004 (H.R. 743), by Dawn Nuschler.
withholding process for attorney representatives of Social Security disability
claimants, SSA withholds an assessment of up to 6.3% from the attorney’s fee.
Before P.L. 108-203, if the claimant representative was not an attorney, or the claim
was for SSI benefits, SSA would send the full benefit award to the claimant and the
claimant representative would be responsible for collecting his or her fee from the
individual. The new law capped the assessment for processing attorney fee payments
at the lesser of 6.3% of the attorney’s fee and $75 (indexed to inflation); provided for
a temporary (five-year) extension of the attorney fee withholding process to SSI
claims; authorized a five-year demonstration project to extend the fee withholding
process to non-attorney representatives in both Social Security and SSI claims; and
required the General Accounting Office (now known as the Government
Accountability Office) to study the fee payment process for claimant representatives.
Before P.L. 108-203, SSA was prohibited from paying SSI benefits only (not
Social Security benefits) to fugitive felons (i.e., persons fleeing prosecution, custody,
or confinement after conviction, and persons violating probation or parole). In
addition, upon written request, SSA was required to provide information about these
individuals (current address, Social Security Number, and photograph) to law
enforcement officials. The new law prohibited SSA from paying Social Security
benefits as well to fugitive felons and required SSA, upon written request, to provide
information to law enforcement officials to assist in the apprehension of these
individuals. The new law authorized the Commissioner of Social Security to pay,
with good cause, SSI and Social Security benefits previously denied because of an
individual’s status as a fugitive felon.406
If an individual receives a government pension from work that was not covered
by Social Security, his or her Social Security spousal or widow(er) benefit is reduced
by an amount equal to two-thirds of the non-covered government pension, under a
provision known as the Government Pension Offset (GPO). Before P.L. 108-203,
a state or local government employee who was not covered by Social Security would
be exempt from the GPO if he or she worked in a Social Security-covered
government position on the last day of employment. That is, under the “last day
rule,” a non-covered state or local government employee could avoid having his or
her Social Security spousal or widow(er) benefit reduced under the GPO by
switching to a Social Security-covered government position for one day (or longer).
Under the new law, a state or local government employee must be covered by Social
Security for at least the last 60 calendar months of employment to be exempt from
the GPO.407
Before P.L. 108-203, a noncitizen was not required to have authorization to
work in the United States at any point to qualify for Social Security benefits. Under
the new law, a noncitizen who is assigned a Social Security Number (SSN) in 2004
406 For more information on this topic and a related decision by the United States Court of
Appeals for the Second Circuit in December 2005, see CRS Report RL33394, Social
Security Administration: Suspension of Benefits for Fugitive Felons and the Agency’s
Response to the Fowlkes Decision, by Scott Szymendera and Kathleen S. Swendiman.
407 For more information, see CRS Report RL32453, Social Security: The Government
Pension Offset (GPO), by Laura Haltzel.
or later is required to have work authorization at the time the SSN is assigned, or at
some later time, to gain insured status under the Social Security program.
Specifically, if the individual obtains work authorization at some point, all of his or
her Social Security-covered earnings count toward qualifying for benefits (all
authorized and unauthorized earnings). If the individual never obtains authorization
to work in the United States, none of his or her Social Security-covered earnings
count toward qualifying for benefits. A noncitizen who was assigned an SSN before
2004 is not subject to the work authorization requirement established under the new
law (i.e., all of the individual’s Social Security-covered earnings count toward
qualifying for benefits, regardless of his or her work authorization status).408
a.On April 2, 2003, the House approved H.R. 743, The Social Security Protection
Act of 2003, introduced by Representative E. Clay Shaw (R-FL), by a vote of 396
(219-R, 176-D, 1-I) to 28 (3-R, 25-D).409
a.On September 17, 2003, the Senate Finance Committee approved an amendment
in the nature of a substitute to H.R. 743, as passed by the House, by a voice vote.
b.On December 9, 2003, the Senate approved H.R. 743, with an amendment that
substituted for the version of the bill approved by the Senate Finance Committee, by
unanimous consent.
a.On February 11, 2004, the House agreed to the Senate version and passed H.R.
408 For more information, see CRS Report RL32004, Social Security Benefits for
Noncitizens: Current Policy and Legislation, by Dawn Nuschler and Alison Siskin.
409 Congressional Record. April 2, 2003. House. Roll call no. 102, not voting 10. pp.
H2668-9
410 Congressional Record. February 11, 2004. House. Roll call no. 23, not voting 11. p.
H477-8.