The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1935-01-15
The Security Scheme
(New York Herald Tribune)

The advance reports of the presi-
dents social security scheme are si-
lent as to most Of the important de-
tails. but the broad outline which
they draw is about what might be
expected. BY combining the promise
Of federal grants with the threat Of
punitive taxation, the states will be
compelled to set up the scheme on a
national pattern. The scheme itself
will provide for pensions Of perhaps
$40 . month to all the INDECENT above
the age Of sixty-five and unemploy-
ment benefits, presumably limited to
some relatively short period-say four
or five months-for all others. Both
sorts Of payments will be met from
funds set up through equal contribu-
lions from employers and employees,
without governmental grants, and only
those now employed and under the
age Of sixty-five will be covered by
this part Of the scheme. For the
needy who are already above the age
Of sixty-five pensions will be pro-
vided directly out OF taxation-half
federal and half state-while the
president expects to take care OF all
the younger unemployed through his
work relief scheme.
These are colossal proposals. Their
ultimate economic effect must de-
pend largely on the way they are ad-
ministered. Down to the beginning
Of the great federal and local borrow
ings for relief, the aged, the disabled
and the unemployed were supported
by hook or crook out Of current in
come and savings1whether through
the medium Of individual savings &C.
counts, OF friends and relatives, Of
private charity or Of tax-supported
agencies. What is now proposed is
to socialize this highly individualistic
process. II, through q rigid limita-
ton Of benefits and insistence upon
the actuarial sounduess of the insur-
ance funds, the net result were mere
~ to support the INDECENT at about
the previous level and in substantially
the same way, except that the money
would pass through government agen-
cies rather than private channels
there would presumably be little il
any effect upon the economic system
as . whole.
A powerful engine, however, would
have been set up capable OF produc-
ing quite different effects. II the
benefits were pitched Gas inevitably
they would bel at q somewhat higher
level than the average obtained by
the old individualistic methods, the
effect would be somewhat to reduce
current income Of the more prosper.
Gus parts Of the community and in
crease income and consumption o.
the more poverty stricken elements
This might tend somewhat to damp
booms and to cushion depressions
thus promoting that more stable
economy for which every one long,
and which few would probably enjo.
II they got It. But by that time thu
pensioners would have their high
| pressure Hobbies ct work: congress
would b flooded with proposals To-
extending benefits, reducing contri
buttons, sustaining the funds out o
TAXATION. The tariff, the income ia,
and the currency would be forgotten
before this magnificent new instru
ment for the redistribution Of wealth
| 1T = interesting to note the rise o
DR.. Townsend - . sort of transitions
figure between the old currenc
crankS and the coming pension
crankO: and In the process Of redis
txibution the dislocations Of our gen
ssal economy would be many an
drastic.