CHAPTER 15.—NON-CONTRIBUTORY OR STRAIGHT OLD AGE PENSIONS SYSTEMS, 318

a—ALASKA, 318 b—ARIZONA, 319 c—AUSTRALIA, 320 d—DENMARK, 322 e—GREAT BRITAIN, 324 f—NEW ZEALAND, 332 g—URUGUAY, 335

PART VI APPENDIX A—BILL INTRODUCED BY SENATOR MCNARY, 339 B—BILL PRESENTED BY THE COMMISSION TO THE 1921 PENNSYLVANIA STATE LEGISLATURE, 342 a—ADMINISTRATION, 343 b—ALLOWANCE, 344 c—QUALIFICATIONS OF CLAIMANTS, 345 d—PROPERTY QUALIFICATIONS, 345 e—CALCULATIONS OF INCOME, 346 f—HOW ADMINISTERED, 346 g—FINES, PUNISHMENT AND CRIMINAL PROCEDURE, 349 h—FUNDS AND EXPENSES, 351 i—ANNUAL REPORT HEARINGS ETC., 351

FOREWORD

This book is, frankly, an appeal for social action. It attempts to set forth the need for a constructive policy with regard to the aged. While the tide in social legislation seems to have turned during the past few years, so that in many states attempts are being made to repeal long sought for protective measures, there is on the other hand evidence of an awakening of many to the realization that the problem faced by the aged cannot be ignored or postponed much longer. There is a growing consciousness that social action is as inevitable for the United States as it was in most countries abroad. Suffice it to mention the many state commissions investigating the problem recently, the great number of industrial concerns grappling with it, and the numerous resolutions adopted by many church bodies, fraternal orders and trade union organizations endorsing government legislation with regard to the aged. The fact that twenty-six foreign countries have already adopted some form of social action for the relief of the aged is indicative further that the problem is a matter for social rather than for individual solution.

The writer did not approach the question of insurance with any preconceived notions. Three years of first hand study of the problems of the aged in one of our leading industrial states—Pennsylvania—convinces him, however, that no other way out is feasible. Our present methods, in dealing with the aged are antiquated, inefficient, ineffective, costly and demoralizing. Some constructive social policy must be inaugurated. In discussing the plans suggested for adoption, an earnest effort has been made to present the merits and demerits of each proposed scheme of legislation impartially. The writer may be accused, however, of a certain bias in connection with this presentation, to which he pleads guilty. Absolute impartiality in matters of social policy is only possible when convictions and interests are slight. After everything has been said and done it remains for the individual to determine what he understands by “right” and “truth,” and he can only be guided by his own conscience and convictions.

In describing the pension systems of foreign governments, an attempt has been made to bring the facts up to date. This was only partly successful. Since the beginning of the war, European documents which were readily obtainable under normal conditions, have been very meagre and limited, and some reports have not been brought up to date.

The subject matter in the book beginning with Chapter Eight has been drawn liberally from the report of the Pennsylvania Commission on Old Age Pensions which was written by the author in 1919. Everywhere, however, an attempt has been made to collect and present the latest available data.

The writer wishes to record his debt of gratitude to the Pennsylvania Commission on Old Age Pensions, which has so generously extended to him the time and the office facilities which were necessary in the preparation of this volume. The keen interest of members in the problem has been a constant encouragement and source of inspiration. He also wishes to acknowledge his indebtedness for helpful suggestions in preparing the manuscript to Professor Henry R. Seager of Columbia University, Mr. George M. P. Baird, formerly of the University of Pittsburgh, Miss Mary Bogue of the Mothers’ Assistance Fund of Pennsylvania, Miss Theresa Wolfson of the Consumers’ League of New York State, and Mrs. Helen Glenn Tyson, of the University of Pittsburgh.

A. E.

NEW YORK CITY _July 5, 1921_

INTRODUCTION

During the past dozen years, America has made her greatest progress in manifesting public concern for her large numbers of bread-winners who are annually rendered incapable of self-support by accident, sickness, unemployment and old age. These four great contingencies in the life of the wage-earner—long recognized as social problems of pressing importance in countries of earlier industrial development—now claim our increasing attention.

The free access to tillable land, which long offered “another chance” to the dissatisfied industrial employee, has become to millions of American city dwellers nothing more than a dream. Meanwhile, as our country has become increasingly industrialized we have invited to our shores millions upon millions of immigrants whose course of thinking has not been influenced by American social and economic opportunities of the past. We have a diverse population that yearly becomes more and more like the populations of those older countries, and still less akin to our earlier sturdy sons of immigrants who half a century ago could and did sing “Uncle Sam is rich enough to give us all a farm!”

With the ever-increasing demand for essential workers in our industries has come a condition where matter-of-fact statisticians report 3,000,000 disabling accidents yearly causing 50,000,000 days lost time; and 250,000,000 days lost annually on account of sickness; while “four times in a single generation the numbers of the unemployed in the United States have been counted by millions and the idle capital of the country has been counted by the billions of dollars.” All of this has its effect upon savings for old age.

The United States, a younger nation, and with traditions of individualism based on earlier opportunities, has been slower to face these industrial problems, but recently there have been signs of an awakening sense of responsibility. Voluntary efforts of trade unions and humanitarian experiments of the more thoughtful employers have blazed the way towards social action. Half-a-hundred official investigating commissions have collected, classified and disseminated information—resulting in most instances in recommendations for American legislation.

The industrial accident problem has been attacked in America by an intelligent method of social insurance, and although fully adequate benefits are not yet offered, within twelve years no less than forty-seven workmen’s compensation laws have been adopted. Naturally enough, the equally important problem of wage-earners’ sickness is now under constant investigation and the public is learning to look upon it as a subject which will in future claim far more sweeping legislative attention. Unemployment, the most complex of all industrial questions, periodically forces its way to the front pages of our newspapers, and in 1921 the Senate Judiciary Committee in one state legislature, by unanimous vote, recommended the adoption of compulsory unemployment compensation. The rapid spread of American social legislation, when once initiated, is strikingly illustrated by the adoption of Mothers’ Pension Laws in forty-one states and territories during the nine years 1911 to 1919.

Old age dependency has been less talked about, partly no doubt because this evil presents itself less dramatically—its saddest victims usually being hidden from the public eye—partly also, because fewer people realize its connection with our modern industrial methods. Men have always grown old, it is true, but now when they must seek work in a system whose demands for intense application or speed are often merciless, they are rejected as unemployable and find themselves without means of support at an earlier age. In exceptionally fatiguing or dangerous trades the “human scrap-heap” age is distressingly low. A system which in the past has paid wages far too low to permit the average workmen to prepare for old age by saving, is annually refusing jobs to thousands who are “too old” to do its work.

The haphazard attempts to meet this problem through public or private charity, employers’ pension systems and trade union or fraternal society benefits, have proved to be not only inadequate and inhumane, but also both costly and wasteful. Recently great progress has been made toward scientific handling of the problem as it affects public employees, especially teachers.

The United States Government and many states and cities have organized successful pension systems for their public servants. A valuable record of a large scale American experiment is furnished in the report of the first year’s experience of the federal government with its pension plan covering nearly one-third of a million civilian employees in the classified service. But the problem of old age dependency for private employments, has not been adequately met in any part of the United States. Fortunately, signs of intelligent interest are becoming more and more evident. Half a dozen states have appointed commissions to study the subject, valuable material has been gathered, and bills drafted. Unofficial but equally interesting investigations have been carried on by labor organizations and fraternal orders. Americans are recognizing the urgency of this problem and are seeking authoritative information.

Not since the publication in 1912 of Mr. Squier’s “Old Age Dependency in the United States,” have we had a new and comprehensive book treating this problem. Appearing now when there is both need and demand for such information, Mr. Epstein’s volume is especially timely and valuable. His experience as Director of the Pennsylvania Commission on Old Age Pensions has given him an exceptional opportunity for intensive study of the field, and the book contains a wealth of modern, well organized material presented from the modern American point of view. It is decidedly the most convenient compilation of up-to-date information on this very important subject.

JOHN B. ANDREWS.

24 Gramercy Park, New York City. January, 1922.

PART I ACTUAL CONDITIONS OF THE AGED