Daily capital journal. (Salem, Oregon) 1903-1919, 1908-01-22

tabular period.
have given careful study to thi.
feature OF the rate question, and In
formulating the suggestions EN-.
bodied in what follows in this re-
port, have had the able actuarial
assistance OF DR.. G.. e. West, chief
of the record department of the head
clerks Office. whose ability and re-
liability In actuarial work is known
to every member of the council. |
do not hesitate to endorse, as abso-
lutely correct, the rate tables en-
braced in the several plans hereafter
submitted for the councils consider
alton, and | am sure that those rates
will be found correct by every COM
petent actuary.
! A reserve in the pocket OF the
members is never available when
needed, by the way. II does not earn
interest and make possible still low
er rates for the members. and, un-
like the reserve invested under Off
cial auspices, is usually dlssipated
: by the holders, who default on their
obligations at maturity.
II should be remarked here thai
fraternal beneficiary society like
Gus never defaults, never repudlates
Its obligations. Only the members.
who In fact are the society. can do
this. For years they cheerfully pay
less than cost for their protection,
and when the time comes for them
10 produce their so-called pocket
reserves" they wax Indignant and
lapse out. damnlng the society and
It's ofIlcers-for what? For their in
ability 90 continue to give them
something for nothing.
This is the history OF the pocket
reserve" system II has deprived
hundteds Of thousands OF families
OF Insurance protection. It owes
millions OF dollars Il will never pay
through refusal or failure of mem-
hers to pay extra assessments levied
10 meet old age losses-losses that
whore Hnproyided for In the years OF,
prosperity under the current cost
system. On the other hand, the loss
of reserves accumulated and invest.
ed under Official supervision amounts
10 practically nothing.
The argument Is all IN favor of the
level rate against the annually in.
creaslng rate, in my humble iudg-
ment. While II is a difficult matter,
at best. for any society with a large
membership to readjust its rates on
adequate plans. still. II given the
choice, and If readiustment Is found
TO be inevitable. the average man
prefers level rate. a rate that does ,
not change with his age. and that /
will permit him. during his produc- !
tive young years. 10 provide a fund. /,
a reserve. 10 be employed for his re-
lief during the non-productiye years
of his old age. The average man
will not, If he can avoid Il. accept a I.
plan of protection for his dependents (
that imposes upon him and annually f.
increasing burden from year to year. I
and which becomes most burdensome .
in those years in which he is least ,
able TO pay
The level rate plan. therefore,
seems TO meet every requirement OF /
the average member. The only OBJ
lection TO it that has ever been seri-
ously advanced. is that it means the
accumulation and investment of mill
ions of dollars, with consequent
danger OF loss. J
If, as a society, We are to live and
meet our future obligation, We must
either adopt and adequate natural
premium plan-the rates advancing
rom year 10 year or by series OF
years, with some possible modifica-
ions involving the accumulation
md investment Of full reserves.
We must either provide a reserve
iund TO hold the rates reasonably low :
and level for life from age at entry.
1r we must collect more money each
year from each member 10 meet the
annually Increasing costs. We have I
he choice of these two basic plans.
With their possible notifications;
We must choose either one or the
,ther. II We are to live and pay out. 1