COMMENT UPON VOLUNTARY NATURE OF SOCIAL SECURITY by Larry Becraft, Attorney.

Today, everyday Americans are constantly confronted with greater and more
frequent requests from all too many sources that they provide to the
inquiring parties their "Number of the Beast," the Social Security number
("SSN"). The examples of this modern day phenomenon are numerous and known
to all. Many States are now moving to ostensibly require the display of
SSNs upon drivers' licenses. Public school officials demand that school age
children obtain SSNs before those children may be enrolled in any public
school. Hospitals seek to obtain SSNs for each child born in their
facilities. Private parties of all kinds, from banks to employers, deem it
essential that they obtain the SSN of everyone with whom they may conduct
any business. With all these entities making these demands, surely "the
law" must contain a requirement that everyone have the "Number of the
Beast"[1]. Or, is it possible that everybody simply acts like lemmings,
dutifully following the herd instinct without any question, assuming such
requirement without any knowledge of it? More simply put, does "the law"
demand that everybody apply for and obtain a SSN, or is such purported
obligation nothing more than so much hot air? 

The first inquiry regarding the legal duty to apply for and obtain a SSN
must involve an examination of the U.S. Constitution and the powers granted
therein to Congress. Congress can only possess powers which are contained,
expressly or by necessary implication, within the text of the Constitution,
particularly Art. 1, section 8. Being straightforward and to the point, the
problem here for Social Security is that no particular clause in this or
any other article of the Constitution is sufficient to sustain such power
to compel a domestic American to participate in a compulsory retirement or
benefits scheme. The power to thus mandate participation in Social Security
must therefore be one which is based upon an implied power. 

To determine if this power is one arising by implication, a study of
various Supreme Court cases regarding the limits of Congressional power is
essential. The States are arguably the governmental entities which might
possess the inherent, municipal power to compel participation in a
retirement or benefits scheme; but, if the states might have this power, an
issue which appears to not have as yet been decided, does Congress have a
corresponding power? Can Congress assume this inherent power of the State
and claim it as its own? 

Examples of Supreme Court cases which place some real limits upon the
powers of Congress are manifold. In the License Tax Cases, 72 U.S. 462
(1866), the Supreme Court held that Congress could not authorize the
conduct of business within the States in order to tax that business. In
United States v. DeWitt, 76 U.S. 41 (1870), the Court held that a penal
regulation in a tax act could not be enforced in a state. In United States
v. Fox, 94 U.S. 315 (1877), the Court held that the United States could not
receive property via a testamentary devise contrary to state law. In United
States v. Fox, 95 U.S. 670 (1878), a penal statute remotely related to
bankruptcy laws was held inapplicable in the States. In Patterson v.
Kentucky, 97 U.S. 501 (1879), the Court held that U.S. patent laws
conferred no superior rights within the States. In United States v.
Steffens, 100 U.S. 82 (1879), federal trademark legislation unconnected
with "interstate commerce" was held inapplicable inside the States. In
Baldwin v. Franks, 120 U.S. 678, 7 S.Ct. 656 (1887), certain penal, federal
civil rights legislation was held unenforceable "within a state." In Ex
parte Burrus, 136 U.S. 586, 10 S.Ct. 850 (1890), and De La Rama v. De La
Rama, 201 U.S. 303, 26 S.Ct. 485 (1906), the Court held that domestic
relations matters were solely state concerns. In Reagan v. Mercantile Trust
Co., 154 U.S. 413, 14 S.Ct. 1060 (1894), it was held that federally created
corporations engaged in business in the States were subject to state laws.
In Keller v. United States, 213 U.S. 138, 29 S.Ct. 470 (1909), it was held
that Congress could not exercise police powers within the States. In Coyle
v. Smith, 221 U.S. 559, 31 S.Ct. 688 (1911), it was held Congress could not
dictate to a state, Oklahoma, where to locate its state capitol. In Hammer
v. Dagenhart, 247 U.S. 251, 38 S.Ct. 529 (1918), and Bailey v. Drexel
Furniture Co., 259 U.S. 20, 42 S.Ct. 449 (1922), the Court held that
Congressional attempts to regulate and control manufacturing activities in
the States were unconstitutional; see also Hill v. Wallace, 259 U.S. 44, 42
S.Ct. 453 (1922). In United Mine Workers of America v. Coronado Coal Co.,
259 U.S. 344, 42 S.Ct. 570 (1922), the Court held that Congress could not
regulate coal mining in the States. In Linder v. United States, 268 U.S. 5,
45 S.Ct. 446 (1925), it was held that Congress could not regulate the
practice of medicine in the States. In Industrial Ass'n. of San Francisco
v. United States, 268 U.S. 64, 45 S.Ct. 403 (1925), the construction
industry was deemed to be inherently of local concern and beyond
Congressional powers. In Indian Motocycle Co. v. United States, 283 U.S.
570, 51 S.Ct. 601 (1931), the Court held that Congress could not impose a
sales tax on items sold to state and local governments. Before the advent
of Social Security, a statutorily mandated retirement system applicable to
interstate carriers was held unconstitutional in Railroad Retirement Board
v. Alton R. Co., 295 U.S. 330, 55 S.Ct. 758 (1935). The case of Hopkins
Fed. S. & L. Ass'n. v. Cleary, 296 U.S. 315, 56 S.Ct. 235 (1935), stands
for the proposition that Congress cannot "federalize" state financial
institutions over objection from the State. The cases of A.L.A. Schecter
Poultry Corp. v. United States, 295 U.S. 495, 55 S.Ct. 837 (1935), Panama
Refining Co. v. Ryan, 293 U.S. 388, 55 S.Ct. 241 (1935), and Carter v.
Carter Coal Co., 298 U.S. 238, 56 S.Ct. 855 (1936), emasculated most of the
National Industrial Recovery Acts in part on the grounds of invasion of
reserved powers of the States. In United States v. Butler, 297 U.S. 1, 56
S.Ct. 312 (1936), the Court held that Congress had no direct power to
regulate agricultural production within the States. Finally, in Oregon v.
Mitchell, 400 U.S. 112, 91 S.Ct. 260 (1970), it was held that Congress
could not dictate voter qualifications to the States. The above decisions,
as well as others, do place severe restraints upon the powers of Congress. 

The genesis of Social Security is the events of the Great Depression. While
that era saw extraordinary unemployment and a tremendous decline in
national production, still it was not as cataclysmic as other events in our
nation's history, such as the War Between the States. Further, no
constitutional amendment was adopted during this era which can offer any
basis for an expansion of Congressional powers. The legislation which
started Social Security in 1935 must be viewed in the light of the various
Supreme Court cases decided within a few decades of that legislation and
prior thereto. When Congress adopted the Social Security Act in 1935, the
Supreme Court had already addressed the first such act in 1934 and held in
Railroad Retirement Board, supra, 295 U.S., at 368, that Congress had no
authority to establish a retirement scheme through its most tremendous
power, its control over interstate commerce: "The catalogue of means and
actions which might be imposed upon an employer in any business, tending to
the satisfaction and comfort of his employees, seems endless. Provision for
free medical attendance and nursing, for clothing, for food, for housing,
for the education of children, and a hundred other matters might with equal
propriety be proposed as tending to relieve the employee of mental strain
and worry. Can it fairly be said that the power of Congress to regulate
interstate commerce extends to the prescription of any or all of these
things? Is it not apparent that they are really and essentially related
solely to the social welfare of the worker, and therefore remote from any
regulation of commerce as such? We think the answer is plain. These matters
obviously lie outside the orbit of congressional power." Additionally, the
revolutionary acts of Congress adopted in the two preceding decades had
been emasculated in a series of Supreme Court decisions. Are we to suppose
that, against this legal background, Congress decided to enact legislation
of the caliber which had been struck as unconstitutional in the same year? 

In the second Social Security Act of 1935, Congress imposed excise taxes
upon employers and those tax receipts were to be deposited with the
Treasury. The act further provided schemes whereby participants could enjoy
unemployment and retirement benefits. When the act was adopted, parties
opposed thereto made challenges to the act, relying upon some, if not all,
of the various cases cited above. The major arguments mounted against the
act were premised upon contentions that the legislation constituted an
invasion of state rights. In Steward Machine Co. v. Davis, 301 U.S. 548, 57
S.Ct. 883 (1937), an employer challenged the unemployment tax imposed upon
it and the Court held that such tax was an excise which Congress could
impose. In reference to the contention that the subject matter of the act
was properly within the historical field reserved to the states, the Court
held that Congress could enact legislation to aid the states in an area of
great concern. The Court placed considerable emphasis upon the fact that
the states were reluctant to adopt unemployment acts because such taxes
created differentials between states which had such legislation and those
which did not. By creating a national unemployment act, this difference was
eliminated and a great benefit to the American people resulted. The Court,
therefore, found nothing constitutionally objectionable to the act as to
the issues which were raised. In Helvering v. Davis, 301 U.S. 619, 57 S.Ct.
904 (1937), the same rationale was used to uphold the retirement features
of the act. The importance of these two cases upholding the Social Security
Act concerns the issues which these cases did not raise: neither of them
addressed the issue of whether there was a requirement for any domestic
American to join Social Security. The reason that this issue was not raised
is because there is no such requirement, unless of course one works for a
state government which has contracted into Social Security; see Public
Agencies Opposed To Social Security Entrapment (POSSE) v. Heckler, 613
F.Supp. 558 (E.D. Cal. 1985), rev., 477 U.S. 41, 106 S.Ct. 2390 (1986). 

The above review should readily demonstrate that there is indeed a real
question concerning the point of whether one must submit an application to
join Social Security. The cases which challenged the constitutionality of
Social Security simply did not raise this issue, and it appears that no
case has as yet dealt with it.[2] The reason for this absence of a
challenge to such alleged requirement can only be explained by analyzing
the act itself to determine if there is such a requirement. Because
Congress lacks the constitutional authority to compel membership in Social
Security, the act simply imposes no such requirement. 

The modern version of the act is codified at 42 U.S.C., sections 301-433.
If there were a requirement that every American join the Social Security
scheme,[3] one would expect to find language in the act similar to the
following: "Every American of the age of 18 years or older shall submit an
application with the Social Security Administration and shall provide
thereon the information required by regulations prescribed by the
Secretary. Every member of Social Security shall pay the taxes imposed
herein and records of such payments shall be kept by the Secretary for
determining the amount of benefits to which such member is entitled
hereunder." Amazingly, no such or similar language appears within the act,
and particularly there is no section thereof which could remotely be
considered as a mandate that domestic Americans join Social Security. The
closest section of the act which might relate to this point is the
requirement that one seeking benefits under the act must apply for the
same. But, this relates to an entirely different point than a requirement
that one join and secure a number. 

Since the statutory scheme fails to impose such requirement, the next
question to be asked is whether perhaps the Social Security regulations
themselves might impose such duty. But here, the regulations are no broader
than the act itself, and the duty to apply for and obtain a Social Security
card or number boils down to the following found at 20 C.F.R., § 422.103:
"(b) Applying for a number. (1) Form SS-5. An individual needing a social
security number may apply for one by filing a signed Form SS-5,
'Application for a Social Security Card,' at any social security office and
submitting the required evidence... 

"(2) Birth Registration Document. The Social Security Administration (SSA)
may enter into an agreement with officials of a State... to establish, as
part of the official birth registration process, a procedure to assist SSA
in assigning social security numbers to newborn children. Where an
agreement is in effect, a parent, as part of the official birth
registration process, need not complete a Form SS-5 and may request that
SSA assign a social security number to the newborn child. 

"(c) How numbers are assigned.(1) Request on Form SS-5. If the applicant
has completed a Form SS-5, the social security office... that receives the
completed Form SS-5 will require the applicant to furnish documentary
evidence... After review of the documentary evidence, the completed Form
SS-5 is forwarded... to SSA's central office... If the electronic screening
or other investigation does not disclose a previously assigned number,
SSA's central office assigns a number and issues a social security number
card... 

"(2) Request on birth registration document. Where a parent has requested a
social security number for a newborn child as part of an official birth
registration process described in paragraph (b)(2) of this section, the
State vital statistics office will electronically transmit the request to
SSA's central office...Using this information, SSA will assign a number to
the child and send the social security number card to the child at the
mother's address." The purported duty to apply for and obtain a Social
Security number therefore boils down to this: you get it if you need it or
request it. There is no legal compulsion to do so. 

With the act of applying for and obtaining a SSN being entirely voluntary,
the next question to be asked is whether any State can force you to use
this number which is voluntary in the first place. This appears to have
been addressed by § 7 of the Privacy Act of 1974, 88 Stat. 1896, which
reads as follows: "Sec. 7. (a)(1) It shall be unlawful for any Federal,
State or local government agency to deny to any individual any right,
benefit, or privilege provided by law because of such individual's refusal
to disclose his social security account number. 

"(2) the provisions of paragraph (1) of this subsection shall not apply
with respect to-- 

(A) any disclosure which is required by Federal statute, or 
(B) the disclosure of a social security number to any Federal, State or
local agency maintaining a system of records in existence and operating
before January 1, 1975, if such disclosure was required under statute or
regulation adopted prior to such date to verify the identity of an
individual. 

(b) Any Federal, State, or local government agency which requests an
individual to disclose his social security account number shall inform that
individual whether that disclosure is mandatory or voluntary, by what
statutory or other authority such number is solicited, and what uses will
be made of it." See United States v. Two Hundred Thousand Dollars in U.S.
Currency, 590 F.Supp. 866 (S.D. Fla. 1984). 

Thus, it seems perfectly logical, if having a Social Security number is not
mandatory but purely voluntary, no state can use the lack of a number in
any adverse way against anyone. The state cannot make that which is
voluntary under federal law something which is mandatory under state law. 

Today, many school districts seek to force school age children to obtain
Social Security numbers before such children may enroll in school. Further,
many states deny drivers' licenses to those who refuse to provide SSNs. All
of these acts are of recent vintage and therefore violate the prohibitions
contained within the uncodified amendments to the Privacy Act noted above.