social security, government program designed to provide for the basic economic security and welfare of individuals and their dependents. The programs classified under the term social security differ from one country to another, but all are the result of government legislation and all are designed to provide some kind of monetary payment to defray a loss of or a deficiency in income.

In Other Countries

A social security program was adopted first in Germany in the 1880s, when Chancellor Otto von Bismarck advocated social legislation not only in order to benefit the workers but also to forestall the program of the socialists and gain the support of the workers for his own party. Legislation setting up compulsory sickness insurance, for which the worker paid two thirds of the cost and the employer one third, was passed in Germany in 1883. Compulsory old-age insurance (see pension), the cost of which the employee, employer, and government shared, was adopted in 1889; unemployment insurance legislation, however, was not passed until 1927.

As economic insecurity among workers in the highly industrialized countries spread, an increasing number of social security programs were enacted. In Great Britain, the National Insurance Act, devised by David Lloyd George, was passed in 1911, and a compulsory unemployment insurance program as well as old-age insurance and sickness insurance programs were established. The unemployment insurance system excluded many workers, notably government employees, nurses, casual workers, and those who earned over £250 per annum. A survivors insurance program was adopted (1925); in 1942, Parliament was presented with a plan, by Sir William Henry Beveridge, for a more expanded social security program, much of which was enacted after World War II.

France adopted in 1905 a program of voluntary unemployment insurance and in 1928 made insurance plans for old age and sickness mandatory. Meanwhile, diverse social security programs were adopted throughout Europe, differing from country to country as to the kinds of insurance instituted, the categories of workers eligible, the proportions paid by employee, employer, and government, the conditions for receipt of benefits, the amounts of the benefits, and finally in the overall effects of the programs. In 1922, the Soviet Union adopted comprehensive social security plans as part of their socialist economy. Chile became (1924) the first Latin American country to adopt a social security program.

In the United States

The United States did not have social security on a national level until 1935, when the Social Security Act was passed as part of President Franklin Delano Roosevelt's New Deal program. The act established two social insurance programs: a federal-state program of unemployment compensation and a federal program of old-age retirement insurance. It also provided for federal grants to assist the states with programs for the disabled, the aged, child welfare services, public health services, and vocational rehabilitation. The compulsory old-age insurance paid benefits proportionate to prior earnings for persons over 65, with a reserve fund being accumulated through payroll taxes on employers and employees; the rate of the tax was originally set at 1%.

The original Social Security Act of 1935 covered only workers in commercial and industrial occupations, but since then several major amendments have increased the categories of persons eligible for benefits. The amendment of 1939 provided for benefits to the dependents and survivors of workers; an amendment in 1950 broadened the coverage to include full-time farm and domestic workers, many self-employed persons, employees of state and local governments, and employees of nonprofit organizations; later amendments extended coverage to members of the armed forces and to self-employed professionals; and a 1957 amendment provided benefits to insured workers 50 years of age and older who became permanently and totally disabled. The age of eligibility for retirement benefits was lowered from 65 to 62, but with lower benefits for persons retiring before 65.

In 1965, Congress enacted the Medicare program, providing medical benefits for persons over the age of 65, and an accompanying Medicaid program for the indigent regardless of age. A 1972 amendment tied increases in Social Security retirement benefits to increases in the Consumer Price Index. In 1974, Social Security insurance was taken over by the Social Security Administration, and in 1983 an amendment allowed partial taxation of the benefits given to upper-income recipients. In 1999, payroll deductions for Social Security were set at 6.2% of annual wages below $72,600, and payroll deductions for Medicare were 1.45% of annual wages (no upper limit), with employers contributing matching amounts.

Social Security funds are invested in federal securities, mainly long-term bonds. In 1997 a government advisory panel proposed that some of the revenues be invested in stocks and bonds to generate higher returns. The panel was divided over whether the money should be invested by the government or by individuals, as well as the amount that should be shifted from government bonds. Both approaches have their critics. Some regard government investment in stocks as a potential source of intrusive federal influence on U.S. businesses; others feel that allowing individuals to invest their Social Security funds would endanger the minimal postretirement "safety net" for all workers that the program is designed to provide if individuals invest unwisely. President George W. Bush, who campaigned for personal Social Security investment accounts, appointed (2001) a commission that offered several options for allowing individual investments in stocks and bonds as part of the Social Security program and for securing the program's financial health; it estimated that it would take as much as $3 trillion of additional revenue over the next 75 years and reductions in guaranteed benefits to accomplish both goals.

Underlying these proposals is the anticipation that the costs of the program as presently structured will outstrip the revenues raised and invested in the early to mid-21st cent. and that benefits will have to be paid from revenues alone, which are expected to be inadequate. If this occurs, Social Security will place a greater burden on the federal budget, and benefits may need to be reduced, or taxes increased, significantly. Although historical returns from investment in stock and bonds over the past century suggest that placing funds in those securities would forestall the program's financial difficulties, the dramatic fluctations in stock prices during and after the market bubble of the late 1990s has given many pause, particularly where individual investment accounts are concerned.

Administration of retirement, survivors, and disability insurance (OASDI) and supplemental security income (SSI) programs is vested in the Social Security Administration. The administration was part of the U.S. Dept. of Health and Human Services until becoming an independent agency in 1995. The Medicare and Medicaid programs are administered by Centers for Medicare and Medicaid Services of the Dept. of Health and Human Services. Unemployment insurance is administered by each state under the overall supervision of the U.S. Dept. of Labor. Contributions are collected by the Internal Revenue Service, while the preparation of benefit checks and the management of trust funds are the responsibility of the Dept. of the Treasury.

United Nations Security Council: see United Nations.

Security Council: see United Nations.

Organization for Security and Cooperation in Europe (OSCE), international organization established as the Conference on Security and Cooperation in Europe (CSCE) in 1973, during the cold war, to promote East-West cooperation. Headquarters are in Prague, Czech Republic. The CSCE's 1975 meeting in Helsinki, Finland, ratified the acts commonly known as the Helsinki Accords, which were signed by every European nation (except Albania, which did so later) and the United States and Canada. The OSCE is responsible for reviewing the implementation of those accords. Since the end of the cold war, it has also aimed to foster peace, prosperity, and justice in Europe. There are now 56 OSCE members, including all European nations, all former republics of the Soviet Union, and the United States and Canada.

The Helsinki Accords held the post-World War II European border arrangements to be permanent, and the signers agreed to respect the human rights and civic freedoms of their citizens, as well as to undertake various forms of international cooperation. Although the nonbinding accords did not have treaty status, they were the first international agreement signed by the Soviet Union to mention the rights of free speech and travel. The human-rights provisions had a significant role in galvanizing Soviet and other Eastern European dissidents in the late 1970s, who organized committees to monitor compliance with the Helsinki Accords. Subsequent conferences have been held in various European cities. At the 1990 Paris summit, leaders of the member nations signed a declaration respecting the territorial integrity of Europe, an act that signaled the end of the cold war; limitations were also placed on the size of conventional forces in Europe. An additional agreement in 1992 and a revised treaty in 1999 placed further limitations on conventional forces.

National Security Council (NSC), federal executive council responsible for planning, coordinating, and evaluating the defense policies of the United States and also exercising direction over the Central Intelligence Agency (CIA). Created in 1947 by the National Security Act (amended in 1949), the council's formal members are the president, the vice president, the secretary of state, and the secretary of defense. The director of national intelligence (formerly, the director of the CIA), the head of the Joint Chiefs of Staff, the president's national security adviser (the assistant to the president for national security affairs, who is also the director of the NSC), and the deputy adviser usually attend as invited guests. Although President Eisenhower used the NSC as the centerpiece of his security policy apparatus, other presidents have relied more heavily on ad hoc organizations and special assistants. Prominent NSC directors have included Henry Kissinger and Zbigniew Brzezinski. The council also has a civilian staff that is headed by an executive secretary appointed by the president.

National Security Agency (NSA), an independent agency within the U.S. Dept. of Defense. Founded by presidential order in 1952, its primary function is to encode and decode communications intelligence and to protect U.S. signals and information systems. The mission of its Information Systems Security department (INFOSEC) is to protect classified and sensitive information stored on government computers or networks. The NSA includes the Central Security Service, established in 1972 to promote a full partnership between the NSA and the cryptological elements of the armed forces, and the National Cryptologic School. The agency, which is headquartered in Fort Meade, Md., is the largest employer of mathematicians in the country. Its director must be a military officer. For many years the NSA was the most hidden of U.S. intelligence agencies; its large budget was secret and its existence barely acknowledged.

Homeland Security, United States Department of (DHS), executive department of the federal government charged with protecting the security of the American homeland as its main responsibility. Its primary missions are preventing terrorists attacks within the United States, reducing the vulnerability of the United States to terrorism, and minimizing the damage from potential attacks and natural disasters. Established in the aftermath of the Sept. 11, 2001, terrorist attacks (see Pentagon, the and World Trade Center), the department unifies formerly dispersed nonmilitary government agencies that are responsible for many functions related to American security.

The Border and Transportation Security division, which is the largest division of DHS, includes the Transportation Security Administration, the Bureau of Immigration and Customs Enforcement, and the Bureau of Customs and Border Protection. The Emergency Preparedness and Response division, which includes the Federal Emergency Management Agency and the Strategic National Stockpile and the National Disaster Medical System. oversees disaster preparedness training and coordinates the government response to disasters. The Science and Technology division, including the Environmental Measurements Laboratory, is charged with researching and organizing scientific, engineering, and technological resources to protect the homeland, and the Information Analysis and Infrastructure Protection division analyzes intelligence and information involving threats to homeland security and evaluates vulnerabilities in the national infrastructure. In addition to these divisions, DHS also includes the Coast Guard, the Secret Service, and the Bureau of Citizenship and Immigration Services.

DHS was created by the Department of Homeland Security Act of 2002, and is an outgrowth of the Office of Homeland Security established by President George W. Bush after Sept. 11, 2001. Strong congressional support for a new federal department that would unify diverse and overlapping security functions of the federal government led to a White House proposal for the DHS in June, 2002, and the legislation was passed late the same year. Twenty-two agencies that were formerly in the Depts. of Agriculture, Commerce, Defense, Energy, Health and Human Services, Justice, Transportation, and Treasury or in independent bodies were combined and reorganized in the new department. (Among the agencies with functions relating to homeland security that were not included in DHS were the Federal Bureau of Investigation, Central Intelligence Agency, and National Security Agency.) The creation of DHS involved the largest restructuring of the executive branch of the federal government since the Defense Dept. was established (1947-49). Tom Ridge, who had been appointed (Oct., 2001) to head the Office of Homeland Security, became the first secretary of the department on Jan. 24, 2003. The affected agencies were transferred to the new department beginning in Mar., 2003. DHS is the third largest executive department in the federal government.

Public provision for the economic security and social welfare of all individuals and their families, especially in the case of income losses due to unemployment, work injury, maternity, sickness, old age, and death. The term encompasses not only social insurance but also health and welfare services and various income maintenance programs designed to improve the recipient's welfare through public services. Some of the first organized cooperative efforts to provide for the economic security of individuals were instituted by workingmen's associations, mutual-benefit societies, and labour unions; social security was not widely established by law until the 19th and 20th centuries, with the first modern program appearing in Germany in 1883. Almost all developed nations now have social security programs that provide benefits or services through several major approaches such as social insurance and social assistance, a needs-based program that pays benefits only to the poor. Seealso Social Security Act; unemployment insurance; welfare; workers' compensation.

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In finance, written evidence of ownership conferring the right to receive property not currently in the holder's possession. The most common securities are stocks and bonds. Governments, companies, and financial institutions use securities to raise money. Stocks are securities issued in the form of equity ownership. Bonds are securities that take the form of debt. They constitute promises to pay a specified amount at a specified date and to pay interest at a specified rate in the interim. Most government securities are bonds that pay a fixed amount of interest per year; unlike commercial securities, their repayment is guaranteed. Both stocks and bonds are traded publicly on organized exchanges such as the New York Stock Exchange, the London Stock Exchange, and the Tokyo Stock Exchange. External forces such as international troubles, changes in government policies, and trends in foreign stock markets all have an effect on security prices. For individual stocks, the company's current and prospective financial performance play an important role, as do overall trends within its business sector. Seealso investment; saving.

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Division of the United Nations whose primary purpose is to maintain international peace and security. The Security Council originally consisted of five permanent members—China (represented by the government on Taiwan until 1971), France, the United Kingdom, the U.S., and the Soviet Union (succeeded in 1991 by Russia)—and six rotating members elected by the United Nations General Assembly for two-year terms. In 1965 the number of nonpermanent members was increased to 10. UN members agree to abide by the Security Council's resolutions when they join. The Security Council investigates disputes that threaten international peace and advises on how to resolve them. To prevent or halt aggression, it may impose diplomatic or economic sanctions or authorize the use of military force. Each of the permanent members holds veto power in decisions on substantive matters, such as the application of sanctions. Decisions on both substantive and procedural matters require nine affirmative votes, including the affirmative vote of all five permanent members (though in practice a permanent member may abstain without impairing the validity of a decision).

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U.S. agency that advises the president on domestic, foreign, and military policies related to national security. With the Central Intelligence Agency, it was established by the 1947 National Security Act. It provides the White House with a foreign-policy-making instrument independent of the State Department. It has four members—the president, vice president, and secretaries of state and defense—and its staff is headed by the national security adviser.

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U.S. intelligence agency responsible for cryptographic and communications intelligence and security. Established in 1952 by a presidential directive (not by law), it has operated largely without Congressional oversight. Its director has always been a general or an admiral. Its mission includes the protection and formulation of codes, ciphers, and other cryptology as well as the interception, analysis, and solution of coded transmissions. It conducts research into all forms of electronic transmission and operates listening posts around the world for the interception of signals. Though its budget and the number of its employees is secret, the NSA is acknowledged to be far larger than the Central Intelligence Agency, possessing financial resources that rival those of the world's largest companies.

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