President Franklin D. Roosevelt signs the Social Security Act on Aug. 14, 1935.

When President Franklin D. Roosevelt signed the Social Security Act into law on Aug. 14, 1935, it occurred against the background of the nationwide unemployment and poverty caused by the Great Depression and social reform movements nationwide.

The Great Depression was kicked off by the stock market crash in October 1929. Three months later, the stock market had lost 40 percent of its value. Some $26 billion in wealth disappeared. The plunge was so deep, it took 25 years for the stock market to return to its pre-crash level.

According to reports submitted by the Committee on Economic Security, which Roosevelt created to explore the Social Security plan, there were more than 10 million Americans over age 60 in 1930. However, only about 70,000 retirees were collecting pensions in 1930 and about 180,000 in 1934.

With millions of Americans unemployed and homeless, family support systems were further destroyed–a process that began during the industrial revolutions and urbanization in the 1820s and 1880s. Consequently, millions of older Americans were caught in the economic web of destitution.

In the United States, military pensions served as precursors to the later Social Security system, according to the Social Security Administration. While limited pensions were offered to veterans of the Revolutionary and other wars, the first full-fledged pension system was developed in 1862 for Union soldiers disabled during service in the Civil War. In 1906, old age was made a sufficient qualification for these benefits. By 1910, more than 90 percent of the remaining Civil War veterans were receiving benefits under this program.

Company pensions were few and far between. In the early decades of the 20^th century, the percentage of workers anticipating an employment-related pension from their company or their union was slightly more than 2.0 percent, according to the Social Security Administration. In 1900, there were only five U.S. companies offering industrial workers company-sponsored pension plans.

After the Industrial Revolution and the movement from farms to factories in the 1880s, America generally ignored the problems of poverty, unemployment, and the inability to pay for health care. However, European governments were moving to enact social insurance programs. The concept involved pooling the risk among all citizens to benefit those who cease to have income due to old age, unemployment, or disability.

One of the first formal social insurance programs was adopted in 1889 in Germany at the urging of Chancellor Otto von Bismarck. By the time America adopted the Social Security system, some 34 European nations already were operating social insurance programs.

But all was not well in the United States. The severe depression in the 1890s generated large protest movements, including "Coxey's Army." Ohio industrialist and politician Jacob Coxey in 1894 called on the unemployed from all over the nation to join him in a march on Washington. Although the protest failed, Coxey remained an ardent advocate of public works as a remedy for unemployment.

The depression of the 1930s spawned similar radical economic and social reform movements, including those by Louisiana Gov. Huey Long and novelist Upton Sinclair. Meanwhile, then-President Hoover advocated voluntary efforts by business and private individuals to alleviate the massive social problems caused by the depression.

It was against this background that Franklin Roosevelt launched his New Deal programs that used public works programs to create jobs and build America's infrastructure. For the problem of old-age poverty, Roosevelt sought a middle ground with a government-run program funded by worker and employer contributions that provides guaranteed retirement benefits.

Like many other reformers and European nations, Roosevelt had tried to include a national health care program in the Social Security legislation but had to back down from the powerful forces that opposed it. The Medicare supplement to Social Security was not added until the Lyndon B. Johnson administration in 1965, after being proposed by President Truman in 1945.

On signing the Social Security Act, Roosevelt said: "We can never insure one hundred percent of the population against one hundred percent of the hazards and vicissitudes of life, but we have tried to frame a law which will give some measure of protection to the average citizen and to his family against the loss of a job and against poverty-ridden old age."

Social Security supporters argue that the program is as needed today as it was in 1935. Fewer than half of America's workers are currently covered by any type of employment-related pension program, according to the Social Security Administration.