CHAPTER XII

THE PENSION MOVEMENT IN THE UNITED STATES

The movement for the inauguration of a definite and constructive social policy in regard to the superannuated workers in the U. S. is of comparatively recent origin. Aside from military and municipal pensions, government insurance or pensions in old age are not known in this country. Indeed, while in England legislative committees were seeking a solution for the problem of old age as early as the beginning of the 18th century, the first study of conditions of the aged in this country, authorized by a State Legislature, was not made until almost a century later. The first such study in the U. S. was authorized by the Massachusetts Legislature in 1807. Furthermore, while practically every government in Europe has now in operation a definite system of old age protection which has, in some countries, been in existence for many years, legislative solution of the problem of old age dependency in this country seems, as yet, so distant that it is almost considered an utopian ideal.

Although much more consideration has been given this problem by the different industrial organizations, who are confronted by it as a pressing economic problem, it is surprising to note that even in this field the movement has spread largely within the last decade. As was pointed out in an earlier chapter, the railroad concerns were the first to establish retirement systems; but prior to the present century there was practically only one railroad in the U. S.—the Baltimore and Ohio—that had inaugurated a pension plan for its aged employés. It is very likely that more than three-fourths of the pension systems of industrial concerns now in operation, did not begin to appear until the last decade. In 1810, L. W. Squier upon sending out over 1,000 letters of inquiry to the largest employers of labour in the country, found only 28 systems of old age pensions of one kind or another in existence at that time. The Massachusetts Commission in the same year found only four firms with regular pension systems in that State. In 1818, also, the Pennsylvania Commission in canvassing all concerns in that State employing 500 and more workers, found only about 20 such concerns, exclusive of railroads, having a regularly established pension fund. Half of these, however, were not Pennsylvania concerns, but national in scope, such as the packing houses, International Harvester Company, etc. A thorough canvass made by the New York Merchants’ Association in 1820, revealed only 142 regular systems throughout the country. The negligible number of employés in the receipt of such pensions has been already pointed out. Similarly, the scanty protection against old age afforded the working masses, by means of municipal pensions, fraternal and trade union insurance has also been shown in earlier chapters.

Although, from a pragmatic viewpoint there is little to point to tangible achievements along the line of old age insurance or pensions in the United States, the first steps towards a definite policy in regard to this problem have, nevertheless, been made within the last fifteen years—especially during the decade preceding our entrance into the European war. During that period a remarkable interest in this problem was displayed not only by numerous industrial concerns, business and commercial groups, and students of social insurance, but the first steps towards active governmental participation were actually taken by the appointment of a number of State Commissions to study this problem, through the endorsement of this movement by many high Federal and State officials, by the introduction of a number of bills in Congress providing for such pensions and by the actual adoption of a straight pension plan in the State of Arizona, the establishment of a savings bank system in the State of Massachusetts, and selling of insurance by the State of Wisconsin. The State Commissions, together with the pioneer students and advocates of social insurance in the United States, have, during the last fifteen years, created a formidable and exhaustive literature upon the subject, which at least takes these discussions out of the realm of speculation and ignorant controversy and places the entire problem upon a sound basis of fact and knowledge of conditions as they prevail in the United States.

As in the case of most social legislation, Massachusetts was the pioneer in providing some legislation in regard to the aged. Its savings bank system was authorized by the State Legislature in 1807. Under this insurance system the following forms of insurance are offered to residents of the Commonwealth of Massachusetts, or persons regularly employed therein: (1) Straight Life Insurance; (2) Twenty Payment Life Insurance; (3) Twenty Year Endowment Insurance; (4) Old Age Annuities; (5) Combination Insurance and Annuities and (6) Immediate Annuities. The maximum life insurance policy written is $4,000 and the maximum annuity cannot be for more than $800 per year.

The expenses involved in the administration of the savings bank insurance are borne largely by the State. In order to reduce the expenses involved in this form of insurance, banks are not permitted to employ paid solicitors or house-to-house collectors of insurance premiums. In addition, dividends to stockholders are also eliminated. As a result of this, it is claimed that savings banks are able to offer insurance at considerably lower rates than the rates formerly charged by commercial companies. In addition, every policy holder at the end of each year receives a check from the bank representing his share of the net profits of the business. The different insurance banks have agencies in large manufacturing and commercial establishments, people’s institutes, social settlements and trade unions.

In 1807 the Massachusetts Legislature also adopted a resolution providing for: “an investigation and report relative to the adoption of a system of old age insurance and pensions.” A Commission on Old Age Pensions, Annuities, and Insurance was then appointed which, after bringing in a preliminary report, was extended and given a larger appropriation, and in 1810 brought out a very comprehensive report. This was the first report of its kind to bring out exceedingly valuable information in regard to the actual conditions of the aged in the United States as well as valuable summaries of the European pension plans.

For five years the Massachusetts Report remained practically the only official report in this country which dealt exhaustively with the subject of old age dependency. The Massachusetts Commission declared itself against straight governmental old age pensions, on the ground that any such legislation whether on the subject of old age pensions or insurance, would be premature at that time. Its arguments against non-contributory pensions have already been presented in the preceding chapter. In regard to compulsory insurance the majority of the Commission declared:

“The adoption of any scheme of insurance in this State appears to be inexpedient at the present time. The practical objections to the principle of compulsion are weighty. The idea itself is essentially distasteful to Americans. In England it was abandoned as quite out of question, in view of the prejudice against compulsion. In this Commonwealth this practical objection is reinforced by constitutional difficulties. In view of these conditions, it would be futile to recommend any compulsory insurance system at this time. Whatever the outcome of American experiments with social insurance may be, whether in the direction of the final establishment of compulsory systems, or the extension of voluntary schemes, the introduction of the former can hardly be seriously considered now. In any event, long training in the development of voluntary insurance agencies seems desirable, to furnish the preparation and foundation of any scheme of State insurance, if such should be found ultimately necessary and desirable.

“It is conceivable, however, that the final solution of the problem of old age insurance may be found in some system of obligatory State insurance.”[258]

On the other hand, Mr. Arthur M. Huddell, one of the dissenting members of the Commission concluded:

“I am convinced that the fact of being compelled to live in the poorhouse or dependent upon private charity in old age has a more degrading influence on character than anything else, and should be eliminated from among working people. A non-contributory pension system would stimulate the citizen and help to build up his character. It would not discourage thrift, as the man who has an opportunity is only too eager to save, and he would strive to save over the long road of life to the pensionable age, so as to provide for the breakdowns by sickness or disease that every man fears.

“The thrift habit is hard to build up among the poorer class of people because they do not earn money enough to make even a beginning.”[259]

The Massachusetts Commission also declared that it found in Massachusetts “no alarming amount of old age destitution.” It contended: “If any general system of old age pensions is to be established in this country, this should be undertaken by the National Congress.”

In 1815, the Industrial Commission of Wisconsin brought out a concise and able report on old age pensions, though less comprehensive on its informational side. The Commission, besides presenting the pension systems abroad, also conducted an investigation regarding the status of the aged population in Wisconsin. Although the Commission stated that “the present report is not to be taken as an endorsement of any plan or scheme of old age pensions, but rather a suggestive advocacy of legislation, favourable to the idea,” the Commission did present definite plans for old age relief, which combined both the straight pension and the voluntary insurance scheme. Its plan for a straight annuity provided for the granting of a pension at the age of 65, or 60 years if permanently incapacitated, to U. S. citizens after they had resided ten years in Wisconsin. Before a person could qualify for this pension the plan also stipulated that he must be of good moral character and that he did not have property above debts, valued at more than $500, exclusive of a homestead, nor more than $2,000 inclusive of a homestead. The applicant could have also no income more than $300 per annum if married, nor more than $200 if single. The amount of pension was proposed to be “such a sum which, when added to the applicant’s other means of support, from whatever source derived, will suffice for the reasonable comfort and well-being of the applicant, but no pension shall exceed the sum of $150 per annum per each person.” In order to raise the necessary fund the Commission suggested that one-half of it be furnished by the State and the other half by the county. The State’s quota, it was proposed, “should be raised by a special poll tax of $1.50 per annum, upon all citizens of the State between the ages of 20 and 60.” The Commission also proposed a State Insurance system which would sell old age insurance on weekly or monthly premiums and should offer insurance to trade unions, fraternal organizations and employers of labour. The administrative expense of the fund, it was suggested, should be borne by the State.

In 1817, the Ohio Legislature created a Commission on Health and Old Age Insurance, which made an extensive report on Old Age Pensions, giving a great deal of data on the conditions of the aged in Ohio, the conditions of the inmates of county infirmaries and a description of the general condition of these institutions. In addition, there is some discussion of the European pension systems. The Commission’s final recommendations were as follows:

“I. The State should provide for the payment of a weekly pension not exceeding $5.00 per week to all persons 65 years of age, but the combined pension and income of any such person shall not exceed $350 annually.

II. The following shall be excluded:

1. Aliens and persons who have been citizens for less than 15 years.

2. Persons who have not been residents of the State for 15 years.

3. Persons convicted of a penitentiary offense, within 10 years.

4. Persons who have disposed of any property in order to qualify for a pension.

5. Tramps and professional paupers.

III. A voluntary system should be established and administered at the expense of the State so that individuals may purchase annuities not to exceed $10 a week by regular payments or by lump sum purchase.

IV. A person 65 years of age or over who qualifies for a pension, but does not take his pension until later, should receive the deferred pension, computed from the date of qualification as an annuity when he does go on the pension roll. Such deferred pension shall not be considered in determining the amount of income in Section I.

V. The property in excess of $100 of any person who receives an old age pension shall, upon the death of such person, be transferred to the State for disposal and from the proceeds thereof shall be deducted the amount which has been paid to the pensioner. Any residue shall then be paid to the lawful heirs.

VI. The old age pension system should be administered by a State Board of Pensioners, consisting of three members.

VII. A County Board of Welfare should be created to combine all of the welfare work of the county, including administration of old age pensions, mothers’ pensions and blind pensions. The board should be unpaid and should employ a county welfare director selected from a civil service list without regard to residence or political consideration.”

Shortly after the appointment of the Ohio Commission, the Pennsylvania Legislature also created a Commission to Investigate Old Age Pensions. This Commission because of its very limited appropriation and short period of work could not arrive at definite recommendations. It therefore asked the Legislature to extend its life for a longer period. It brought out, however, in 1818 a very comprehensive report upon the subject. The Pennsylvania Commission’s investigations of the aged in that State covered a wider scope and included phases not previously dealt with by any of its predecessors. It made exhaustive studies of the dependents in county poorhouses, private benevolent homes, and aged persons who resided in their own homes. It also made a study of the moral and financial conditions, as well as the general management of Pennsylvania almshouses. In addition, the report contains a summary of a great many pension schemes for old age protection as operated in foreign countries. The Commission summarizes its findings in that State as follows:

“Aside from the aged dependents found in almshouses, benevolent or fraternal homes, and those receiving public or private relief there is a considerable proportion (43 per cent.) of the aged population 50 years of age and over, in the State, who, when reaching old age have no other means of support, except their own earnings. Only a small percentage (38 per cent.) of the general aged population in the State claim to possess personal property of their own. This would indicate clearly that many of these aged folk—when their power of earning is steadily declining with advancing years—will fall dependent, in many cases through no fault of their own, either upon the State or upon private charity. The investigations also show that in most of the industries in our State, many workers become unfit before reaching the age of 50, with the inevitable result of steadily decreasing earnings. In certain industries, like that of the railroads, for instance, it appears that more than half of the workers become impaired before their 50th birthday. It is also shown that when the prime of life has passed, many Pennsylvanians are compelled to change their occupations, which ordinarily involves a decline in wages. This decline, with the majority of aged people, appears to be due entirely to sickness and enfeebled age. The increasing problem of old age stands out even more significantly when it is remembered that while the earning power of most wage-workers is steadily decreasing, after a certain period of age has been attained, the expenditures on food and rents, even under normal price conditions, remain the same, while that on medicine is steadily increasing. The investigations also disclose that as far as Pennsylvania is concerned, the problem of support of the aged is largely a native problem, rather than an imported one. The immigrant paupers all claim to have had a long term of residence in both the United States and Pennsylvania.

“Regarding the aged paupers and the non-dependent aged classes, the outstanding differences lie, it would appear, in the respective family connections and physical conditions. In the almshouses pauper group, 40 per cent. were found to be single, 38 per cent. widowed, and only 16.8 per cent. married. Among the inmates of benevolent homes for the aged, the percentages were 30.1 single; 58.3 widowed; and only 7.8 married. More than 65 per cent. of both of these groups had no children living and of those that had children, more than 80 per cent. were reported unable to help support. On the other hand, among the non-dependent aged, only 5.4 per cent. were found to be single, 38.2 were widowed, while 55.1 per cent. were married and still living together. Only 10.6 per cent. of the latter group had no children living. Again, of the paupers nearly 80 per cent. had never possessed any property, while the percentage of the propertyless among the non-dependent aged, was 62 per cent. With regard to the physical condition, it is also shown that while 64 per cent. of the aged persons residing in their own homes were still in fair or sound physical health, the percentage of those in good health in pauper institutions was 35.8 in the case of inmates of the benevolent institutions, and only 12.3 per cent. in the case of the almshouse inmates.

“That dependency in Pennsylvania is not entirely due to the personal shortcomings of the individuals, is evidenced from the excellent recommendations given practically all the inmates of almshouses, followed up by the Commission, by their former employers. Giving due consideration to the fact that most humans will strain a point rather than give a poor recommendation, the reliable qualities of these inmates are evidenced nevertheless, from the fact that most of these inmates have served for long periods of time with one employer (30 per cent. serving for more than 10 years).

“The Commission’s investigations also disclose an exceedingly confusing and bewildering system of management of our county poorhouses. Not only do many of the officials connected with these institutions have little knowledge of the problems involved in the care of the aged, but there is obviously a laxity in the management of these institutions and the distribution of county funds. The State supervision of these aged homes is insufficient, loose and hardly competent. Careful records are kept in only a few institutions. There is no uniform method of accounting. Computations of costs are made in almost as many forms and methods as the men making them. Many of the per capita costs of almshouses given in the report of the State Board of Public Charities do not represent the actual cost. The latter do not include the interest on farm products. According to the Commission’s estimate from records submitted by the directors of the poor to the State Board of Public Charities, the average cost per capita per inmate, in 1817, was $5.87 per week. The cost in the private institutions was even higher than that. It is also shown that in a few instances the per capita costs were more than abnormally high.

“From the Commission’s study of the existing means providing for the protection of the aged and superannuated, it is also apparent that they are insufficient and can never be expected to meet the situation to any extent. It is shown that with all the numerous forms of aged benefits provided, only about 10,000 aged people in the State are actually benefited. Of the numerous large industries in Pennsylvania only about twenty make it a rule to care for their aged employés after long and faithful service. While all the large railroads in the State pension their faithful workers—after a long period of service—the number of railroad workers actually benefited, as compared with the total number of workers in this industry is insignificant. It also appears that only the first and second class cities in Pennsylvania provide against age of their various municipal employés. The number of persons who may expect old age benefits, as such, from fraternal or trade union organizations is hardly worth considering.”

In its bill, submitted to the 1821 Pennsylvania Legislature, the Commission proposed a system of non-contributory or gratuitous old age assistance. The system was to be administered mainly by a state board created for that purpose, although county boards were also set up for the purpose of rendering local assistance in administering the plan. Pension payments were proposed to commence at the age of 65 and were to be granted to all men and women, citizens of the United States, who have resided at least 15 years within the State. The bill also suggested that in the case of a person who has lived in Pennsylvania for 40 years, the residence requirements immediately preceding application should be reduced from fifteen to five years. Excluded from the receipt of pensions were the inmates of charitable and correctional institutions; and those whose income exceeded $300 per year, or whose property was valued at more than $5,000, inclusive of a homestead. The bill permitted the retention of a homestead, when personally used, and provided for the deduction of the total amount granted in pensions, from the proceeds of the accumulated property upon the death of the pensioner. The maximum pension was set at $25 per month and the funds were to be raised by the State, either through a special tax, or by raising the current inheritance taxes. The Commission estimated that about 100,000 persons 65 years and over in Pennsylvania would qualify for pensions which would involve an annual cost of from $18,000,000 to $20,000,000.

In 1818, the Connecticut Commission on Public Welfare while it made no extensive study of its own of the problem of old age in that State concluded that:

“We may criticize the ineffectiveness and the cost of existing forms of voluntary insurance against the disabilities of age, just as we may realize that a considerable burden is imposed on the State by the maintenance of those who, for one cause or another, are unable either to work or to find work and so become wholly dependent on the State or on private charity. Notwithstanding this, it is doubtful if the situation in Connecticut, with regard to the extent of the disability or the necessities of those who become so disabled, is so acute as to call for the initial experiment in this report to be made by the General Assembly.”

Commissions to study the subject of Old Age Pensions were also appointed by the States of California, Illinois, and New Jersey. The latter Commissions, however, were instructed to study both Health and Old Age Insurance and while they have brought out reports on the health insurance question, have given little consideration to the problems confronting old age.

In addition to investigating commissions upon the subject, there have been several attempts at definite remedial legislation. For several years past the Massachusetts Legislature as well as the Legislatures of a few other States had a number of bills presented which provided for old age pensions. In the 1820 Legislature of Massachusetts five different bills providing for old age pensions of one form or another were introduced. So far, these have all met with little success. Definite legislation on the subject in this country was first made in Arizona in 1815. Through the initiative and referendum a law was enacted in that year for the granting of old age pensions to all needy citizens of the United States who have been residents of the State of Arizona for at least five years and who have reached at least 60 years of age. The amount of the pension was set at $15.00 per month. The act, however, was promptly declared unconstitutional by the Supreme Court of Arizona, and no concrete legislation upon old age insurance or pensions has as yet been adopted by any State in the Union.

Even the National Congress did not escape the introduction of bills dealing with remedial legislation upon the aged problem. The first bill was introduced by Congressman William B. Wilson (ex-Secretary of Labour), in 1808. This bill provided for the establishment of a national old age pension system of $120 per year for all persons over 65 years of age whose property possessions did not amount to over $1,500 or whose income did not exceed $240 a year. This bill was drawn up under a subterfuge of organizing an “old age home guard of the United States,” in which the bill proposed men and women of that age could enlist in order to receive a pension. Nothing, of course, came out of this bill.

In 1811 Congressman Victor L. Berger—the first Socialist representative—introduced a bill providing a pension of $4.00 a week or less to all persons 60 years of age and over who do not possess an income of over $10 a week. The bill required 16 years of citizenship, good and moral character and provided for the pension to increase or decrease every twelve months in accordance with a sliding schedule. This bill attracted great attention and brought the problem of old age pensions before the public at that time as never before. Another bill was introduced by Congressman M. Clyde Kelly, on June 10, 1813. Mr. Kelly’s bill proposed to pension all persons who have attained 65 years of age, who have been citizens for 20 years, and whose income during the 12 months next preceding the application did not average nine dollars per week. The bill excluded from the receipt of pensions, persons who habitually refused to work, paupers and criminals. The amount of the pension was graded according to the claimant’s income, ranging from four dollars per week, if the income was less than six dollars, to one dollar if the income did not exceed nine dollars per week. The administration was to be in charge of the Secretary of the Interior.

Since then several other bills providing for old age pensions have been presented in the United States Congress. Before the 66th Congress there was a bill providing for Old Age Pensions, patterned after Mr. Kelly’s bill, introduced by Senator Charles L. McNary, of Oregon. This bill aimed to pension all persons who have attained the age of 65 years, who have been citizens for 20 years, and whose income from any source for the twelve months next preceding the application did not average six dollars per week. Pensions were not to be given to persons who had habitually failed to work according to their ability or who were being maintained as paupers or inmates of correctional institutions. The bill proposed that every person who fulfilled the required conditions, should be placed upon the pension roll and be entitled to receive a pension, which was to be provided by an annual appropriation from Congress. The pension was to be graded according to the following schedule: “four dollars a week when the average weekly income of the pensioner, as calculated under the act, does not exceed six dollars; three dollars when the income exceeds six dollars but does not exceed seven dollars; two dollars when the income exceeds seven dollars, but does not exceed eight dollars, and one dollar when the average income exceeds eight dollars, but does not exceed nine dollars. The bill further provided that the pension may be increased or decreased every twelve months, whenever the pensioner’s income increased or decreased, according to the terms of the schedule. When both husband and wife are pensioners and living together the pension of each was to be three-fourths of the regular rate. The administration of this act was to be in charge of the Secretary of the Interior.

In tracing the movement for old age protection in the United States notice must be taken not only of the interest displayed by the State and national legislatures but also of the important recognition given this subject by industrial experts, business and commercial bodies, political and church organizations and other associations of various kinds as well as the demands for such legislation steadily and vigorously made by the growing labour movement of the United States.

The second industrial conference called by President Wilson, in its report of March 6th, 1820, declared:

“There have been many plans of health insurance and old age insurance elaborated in other parts of the world and advocated in the United States. Without discussing whether such plans, when based upon government subsidy or compulsory action, are consonant with American ideals, the Conference believes that an extension and simplification of the insurance principle as a means of promoting thrift, saving and independence, would be advantageous to the people. The alternative to such insurance against sickness and old age lies in a wage adequate to cover these items. The Conference therefore suggests that the Federal Government should inaugurate a careful, authoritative investigation on the whole subject.

“The problem of health and old age insurance, and its promotion by some means consonant with national ideals, demands consideration. If such means can be devised, they will furnish a relief to the states in the care of the ill, the indigent and the aged.”

So far, the sentiment of the business and commercial groups in this country has not been very sympathetic towards any governmental action in regard to the aged. In 1817, the Boston Chamber of Commerce selected a special committee to study this problem, which, apparently influenced by the conclusions of the Old Age Pension Commission of that State, declared in its report:

“Your Committee has considered various plans for non-contributory old age pensions and is unanimously opposed to any such measure with the non-contributory feature for the following reasons:

“1. There is no such need for legislative provision for old age in Massachusetts as there was in any foreign country in which legislation has been enacted. Pensions in any case would be less necessary than health insurance. Health insurance and accident compensation lead to preventive measures and increase the earning power of workers, but old age pensions are remedial, not preventive and are, therefore, less valuable socially.

“2. These foreign systems which involve contributions from employés are, therefore, preferable to the English system of outright payment. In France and Germany the worker gets his pension as a matter of right even when he is not poor. In England and under the proposed plan for Massachusetts only the poor may have pensions. That is, the proposed plan has essentially a poor law character and is not an industrial measure.

“3. Non-contributory pensions weaken the inducement to thrift.

“4. The inevitable effect of the establishment of a system of non-contributory old age pensions would be a constant pressure to lower the age limit and increase the amounts of the pension.

“5. The proposed Massachusetts law would tend greatly to increase the taxes; and Massachusetts is at present making a radical experiment with its tax laws. The pensions now proposed are low, the age of eligibility is high, and few except the almshouse old are recommended to be dealt with. The proposed tax burden will therefore increase greatly in succeeding years.

“6. To raise the necessary money large extra taxes would have to be levied on the capital and industries of the Commonwealth, This would result in the first instance in a serious disturbance to present industrial conditions. It might also have a tendency to lower wages.

“7. Owing to the uncertainty of conditions due to the great war, it would be unwise for the Commonwealth to assume a large increase in its liabilities.

“8. The constitutionality of such legislation is extremely doubtful.”

The National Association of Manufacturers also had a committee studying the problem. This Committee declared in its report that:

“It is fair to state, however, that every able-bodied man who is reasonably intelligent and industrious should through his own efforts on reaching the age of 65, have this provision available. This does not mean that every man should have set aside enough himself, although many ought, but certainly should have set aside something so that with aid from his children, he and his wife should have at least the means of existence and not become dependent on the state or the community.

“Generally speaking, the people of the United States may be divided into two classes in their means of support upon reaching the period of superannuation, viz: those who have the means of support and those who are the subjects of poor relief. This does not include those who are mentally or physically deficient and who may be the inmates of public institutions and not regarded as coming under the category of poor relief.”

And it concluded, that: “After careful consideration of the entire question of old age insurance and considering particularly the importance of preserving the best quality of citizenship for the United States and the maintenance of our institutions on the best basis, your Committee recommends the following resolutions:

“We believe that evidence is lacking to prove a present necessity for the enactment of old age pension legislation for the civil population and we further believe that it is a moral responsibility of the employer to encourage, assist and inspire his employés with the importance and necessity of ways and means for making provisions for contingencies of life, including old age.”

The merits of the above arguments have been discussed earlier and need not be repeated here. To what extent these conclusions are based upon facts has also been indicated in the preceding chapters. However, a more sympathetic note is struck by Alba B. Johnson, President of the Baldwin Locomotive Works and of the Pennsylvania State Chamber of Commerce in his introduction to a special report on Old Age Pensions prepared for the latter organization in 1818. Mr. Johnson states:

“A new principle is coming to be recognized, viz: that a large proportion of those who are unfit for the competition of life are so through no faults of their own, but because of faults in the social system for which they have had no responsibility. Their incompetence is part of the burden which should be carried by the more competent and the more fortunate. In our complex civilization there are also many who are rendered unfit by occupation or by accidents unavoidable in the processes of industry. The undeserved penalty therefore should be borne by the community as an essential part of the cost of production.”

Although planks on social insurance were not adopted by the leading political parties in the last campaign, despite their recommendation by the advisory platform committees, the question has been before the American public as a political subject by its inclusion in the platform of the Progressive Party in 1812, while the demand for an old age pension plan has been a permanent plank in the platform of the Socialist Party since its beginning and was contained also in the platform of the Farmer-Labour Party.

The importance of the problem of the aged is now also recognized by the churches and their leaders. The Federal Council of Churches of Christ has since 1811 included in its social creed a plank for suitable provision for the old age of the workers.

The administrative Committee of the National Catholic War Council composed of four Catholic Bishops also declared in their social reconstructive program in 1818:

“The State should make comprehensive provision for insurance against illness, invalidity, unemployment, and old age. So far as possible the insurance fund should be raised by a levy on industry, as is now done in the case of accident compensation. The industry in which a man is employed should provide him with all that is necessary to meet all the needs of his entire life. Therefore, any contribution to the insurance fund from the general revenues of the State should be only slight and temporary. For the same reason no contribution should be exacted from any worker who is not getting a higher wage than is required to meet the present needs of himself and family. Those who are below that level can make such a contribution only at the expense of their present welfare. Finally, the administration of the insurance laws should be such as to interfere as little as possible with the individual freedom of the worker and his family. Any insurance scheme, or any administrative method that tends to separate the workers into a distinct and dependent class, that offends against their domestic privacy and independence or that threatens individual self-reliance and self-respect, should not be tolerated. The ideal to be kept in mind is a condition in which all the workers would themselves have the income and the responsibility of providing for all the needs and contingencies of life, both present and future. Hence all forms of State insurance should be regarded as merely a lesser evil, and should be so organized and administered as to hasten the coming of the normal condition.”

The demands made by the labour unions for such plans have already been pointed out.

At the time of this writing there are a number of bills providing for old age pensions before the various State Legislatures. Their fate is as yet unknown. But whatever that may be it is obvious to all students of the problem that the movement for social insurance in the United States is growing rapidly and must succeed eventually.[260] On the whole, one may say, that social insurance in this country is being opposed by practically the same groups who fought against the adoption of workmen’s compensation laws, child labour regulations, and similar social legislation, which are now on the statute books of practically all states. It may well be that the inauguration of old age pensions in this country will be preceded by health and invalidity insurance provisions. But that a complete program of social insurance cannot for long be ignored or postponed is now evident to all who are willing to face the facts as they are, rather than hark back to traditions or prejudices which have no basis in fact at the present time.

PART FIVE OLD AGE INSURANCE AND PENSION SYSTEMS OF FOREIGN COUNTRIES AND VARIOUS STATES