Social Security Free Response Practice

Working Americans pay Social Security taxes to fund a retirement benefit when they grow old. This is the most expensive public policy in the world and in a decade it could consume more than half of the federal budget.

Try answering the following FRQ on Social Security and then check your answers to each section by clicking on the question.

In recent decades, entitlement programs have constituted a substantial portion of the United States federal budget. Social security is the largest entitlement program in the United States. From the information in the chart above and your knowledge of United States government and politics, perform the following tasks.

(a) Define entitlement program.

Entitlement programs are government-sponsored programs providing mandated/guaranteed/required benefits to those who meet eligibility requirements/qualifications.

(b) What is the primary source of revenue for the Social Security program?

Acceptable responses include payroll taxes, wages from existing workers, or taxes based on earned income. You must indicate that the tax is related to work or jobs.

(c) Identify one threat to the future of the Social Security program should the trends depicted on the chart above continue.

Acceptable responses include: run out of money, output exceeds input, or declining reserves.

(d) Describe one demographic trend that threatens the future of the Social Security program AND explain how it is responsible for the threat that you identified in (c).

Demographic trends that threaten Social Security include: aging population (i.e. more elderly), people living longer/greater life expectancy, and declining birth rates. Possible explanations for this threat include: the number of workers who fund Social Security is decreasing while the number who draw on the program is increasing; the number of working people now cannot fund the number of retirees in the future; or that the ratio of workers to retirees is becoming more unequal so that fewer workers are paying into the system and more are drawing out of it.

(e) Explain how any one of the trends in the chart above would change if the age of eligibility for Social Security were raised.

If people were to work longer, more people would be paying into the system and the reserves would last longer.

Question: Copyright © 2010. The College Board. Reproduced with permission. http://apcentral.collegeboard.com