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THE SOCIAL SECURITY ACT --- COLAs
“The original ACT provided only retirement benefits to the worker. The 1939 Amendments added two new categories of benefits payment to the spouse and minor children of a retired worker survivors benefits paid to the family in the event of the premature death of the worker. This change transformed Social Security a retirement program for individuals to a family-based economic security program”. “The Story of the COLAS: Most people are aware that there are annual increases in Social Security benefits to offset the effects of inflation on fixed income. These increases known as Cost-of-Living Adjustments (COLAs) are such an accepted feature of the program that it is difficult to imagine Social Security without them. In 1972, the law was changed to provide beginning in 1975 for automatic annual COLAs based on the annual increase in consumer prices. No longer do beneficiaries have to wait and no longer does inflation drain value from Social Security” A Brief History of Social Security SSA No 21-059, August 2000 The Government Pension Offset (GPO) effective January 1982 is completely opposite to the original intention of the 1939 amendment. The same rule applies when the State grants a yearly cost-of-living to prevent an inflation drain value from a retiree’s State pension.
However, a retiree is penalized each time a State COLA is granted because 2/3s of the increase is subtracted from the beneficiary’s Social Security. Is the Federal government stepping on the States right? Many retirees paid Social Security and also paid into a State Pension Fund. They paid into a Public Pension fund and by law are entitled to their spouse’s Social Security. A widow will most often take her husbands Social Security because his lifetime contributions are greater. This is the same rule that applies to wives who either never worked are divorced or do not have their own 40 credits as required by Social Security to receive benefits. When a husband begins to receive his Social Security his wife is eligible to receive one half of his benefits even if she does not have her own earned 40 credits required by Social Security. On the other hand in many cases the retiree has earned Social Security benefits that she forfeits when she takes her husbands Social Security. If a woman marries more than once and remains married for 10 years to the same man she is entitled to receive the highest Social Security benefits from any of her husbands. His Social Security benefits are available to any woman he marries. Throughout the years each new amendment to the Social Security Act has always served to the benefit of a retiree. Has the Government Pension Offset changed that philosophy?
Eileen M. Ryan June 2003
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