Life Before Social Security

Originally posted some three years ago elsewhere.


This year I will be 73 years old, assuming I make it and I have close family now into their eighties. I was born in the first year of WW II and my older relatives born in the 1930s during the Great Depression.

When I was a kid grandparents lived with their children and their grandchildren. One of the kids took in their mom and pop while the rest of the kids were expected to kick into the pot to provide for their support.

That’s the way it was before Social Security.

Folks were expected to work until they died which usually wasn’t long. The average life expectancy for a male in the 1920s was 49 years. If you lived longer there was no expected retirement age. You worked until you could no longer work or until you could no longer find work.

Then you were expected to live on your savings. Home ownership at the time was below 20% in the lower working class and the average wage adjusted for inflation in today’s dollars was around $13,000.  Usually old folks didn’t have sufficient resources to live on.

So you went to your children if you had any. It was expected. Grandma usually got one of the children’s bedrooms.

Lacking family to fall back on old folks relied on charity, churches or became “wards” of the county poor house.

The Great Depression effectively put an end to living with your kids – your kids were now unemployed too and the elderly especially were in shocking economic free fall.

My grandmother was put up in a small apartment paid for by her children after grandpa died. Later when she got too frail to live on her own she was taken in by her daughter and son-in-law.  My in-laws took our grandparents into their own home after my wife’s grandfather lost his sight.

None of this was unusual. It was common among all ethnic groups. Outside the cities vast swathes of America lived like the Joads with subsistence farming or share cropping. The dust bowl and the mechanization of farming drove them off the land and on to the roads.

xmastree.jpg (31932 bytes)

Older men in front of a shack with a Christmas tree on East 12th St., Manhattan

December 1937

It was in this great calamity that social security came to be. Some fifteen years earlier the movement began to shorten the work day from eight to six hours in order to make room for the unemployed. Counter to this was a movement to provide a retirement stipend at age 65 which would allow older Americans to stop working and again make room for the unemployed.

F.D.R. considered social security a way to decrease unemployment while at the same time pumping funds into the economy. It is not surprising that we only got it because of the great calamity of the 1930s. F.D.R. insisted however that workers pay into the system and not simply be awarded a floor income when turning 65.


Lackawanna County poor house for women

The trauma for the elderly of that era can hardly be overstated. As W. Andrew Achenbaum, a historian at the University of Houston, put it, “The Depression destroyed every mechanism that had existed for covering the vicissitudes of old-age dependency.” Some 50% of the elderly in 1935 were living with their children.

Before the creation of Social Security, few Americans had private or state pensions, and most supported themselves into old age by working. The 1930 census, for example, found 58 percent of men over 65 still in the workforce; in contrast, by 2002, the figure was 18 percent.

I retired at age 62 because I had to. The financial institution of which I was a senior officer was acquired when I turned 60. I managed to hold on until 62 when it was acquired again by a still larger institution. My working days were over and there were few jobs out there for a highly paid 62 year old in a shrinking industry. So it was time to say good by.

I was lucky.

During my working life my employers provided excellent medical insurance and defined benefit pension plans, all the while still making substantial profits. Eventually 401K were added to the mix. In return they got a loyal, hardworking staff.

When I retired I received Social Security benefits as well as my defined pension benefits. At 65 I qualified for medicare. I had paid for my own medical coverage for a number of years after I was no longer covered by my former employer. It cost me $1,120 a month for me alone. I had suffered a heart attack in my mid-50s.  If not for Medicare I could not afford medical coverage.  Retirement is ok for an old widower who lives alone, pays his bills, visits the doctor and drives a hyundai.

Today the nation’s largest and most profitable institutions no longer provide defined pension plans for their employees. If you don’t save it yourself and stash away that “matching contribution” in your 401K you ain’t gonna have anything. And even if you do you may not have enough. Assuming of course you have a 401K. Or health insurance benefits. Hundreds of thousands in my own state earn ten bucks an hour with no benefits and no pensions.  Our Governor, a billionaire former CEO of a health insurance company has no interest in Obamacare or expanding Medicaid.

Your kid’s college educations will drain the life out of your savings or they will come out of school with tens of thousands in debt and lousy job prospects. Assuming you have any significant savings in the first place.

Your kid and their spouse (if they’re not living in your basement) will both work forever – not because they necessarily want to (they might) but because they have to.

At the office the CEO will make tens of millions while the worker bees will struggle with lousy “benefits”, no pensions and a salary they can’t live on.

Meanwhile politicos talk of dismantling social security and medicare notwithstanding that tens of millions depend on social security for 90% or more of their income and an unemployment / under employment rate that is expected to remain structurally high for years if not decades to come.

Again I am lucky. My social security benefits are relatively high because I paid the maximum into the system for a number of years; still my benefits account for about 40% of my annual income.

Good thing I’m old. My checks are good for life, Hopefully.  We’ll see.

It won’t get too hot and we won’t run out of gas before I go.

The future’s so bright I gotta wear shades – not.




The anthem of the Great Depression


About toritto

I was born during year four of the reign of Emperor Tiberius Claudius on the outskirts of the empire in Brooklyn. I married my high school sweetheart, the girl I took to the prom and we were together for forty years until her passing in 2004. We had four kids together and buried two together. I had a successful career in Corporate America (never got rich but made a living) and traveled the world. I am currently retired in the Tampa Bay metro area and live alone. One of my daughters is close by and one within a morning’s drive. They call their pops everyday. I try to write poetry (not very well), and about family. Occasionally I will try a historical piece relating to politics. :-)
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7 Responses to Life Before Social Security

  1. great article.

    “politicos” …


  2. My mother (a libertarian Republican before such a thing was popular) always said that the reason Roosevelt introduced social security was to remove older people from the job market to reduce unemployment among younger people. I think there’s some merit in that view. Roosevelt has always struck me as rather cold and pragmatic.


    • toritto says:

      Hi Doc – I agree. Roosevelt decided that offering “social security” at age 65 was better than shortening the work day from 8 hours to 6. The former made more room for younger workers and pumped funds into the economy. Regards.


  3. Pingback: America in Decline | toritto

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