From GI Roundtable 5: Why Do We Have a Social Security Law? (1946)
Veterans of our armed forces, through act of Congress, have a system of unemployment insurance set up especially for them. The “GI Bill of Rights” pays the unemployed veteran a readjustment allowance, payable at the rate of $20 a week, for a maximum of fifty-two weeks during the two years after the veteran is discharged from the service.
The first attempt in this country to help self-employed people was specified under the GI Bill of Rights. Under this law, a former serviceman or woman running his own business can draw benefit payments if he makes less than $100 a month out of his business.
Protection for servicemen under social security
Old-age and survivors insurance does not seem very important, probably, to many servicemen today. For most soldiers, sailors, marines, and recently discharged veterans, the age of 65 is a very long way off.
But several years of service in the armed forces may mean a considerable loss of income for a man’s dependents if he dies. This is because his years of service in the Army, Navy, or Marines will be added to the years during which he worked before the war in a covered employment. The total will be divided into his total wages in figuring his old-age and survivors insurance benefits—thus considerably reducing the benefits for his dependents if he dies, or for himself when he reaches the age of 65. Exactly the same thing happens with any man who leaves a covered employment to take a noncovered job for a similar period.
In most cases, a worker who went from a covered job into the Army, Navy, or Marine Corps would get lower benefits from his old-age and survivors insurance. His and his family’s benefits grow smaller the longer he stays in the service away from his job. Here is an example of what happens to a typical serviceman. The name and events, of course, are imaginary.
Sam Kavanaugh, 26, married, worked for five years, in covered employment at an average wage of $150 a month. He was drafted into the Army on January 1, 1942. On that date, the basic amount on which old-age and survivors payments are determined—called his “primary benefit”—would have been $31.50 a month. If he stays in the service, this is what will happen to his primary benefit:
Jan. 1, 1943, after 1 year in service, his benefit drops to $28.88 per month.
Jan. 1, 1944, after 2 years in service, his benefit drops to $27.00 per month.
Jan. 1, 1945, after 3 years in service, his benefit drops to $25.60 per month.
Jan. 1, 1946, after 4 years in service, his benefit drops to $24.50 per month.
Jan. 1, 1947, after 5 years in service, his benefit drops to $23.62 per month.
If Sam Kavanaugh dies while in the service after July 1, 1947, he will have lost his insurance credits, and nothing will be due his widow and children under the Social Security Act.
To protect the serviceman’s social security rights while he is in the armed forces, several bills have been introduced into Congress. So far, none of them has passed.
Next section: What Do Americans Think about Social Security?
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