The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1935-08-31
BY EDWARD W. LEWIS
United Pcs Stan Corrcsnandrnt

BY EDWARD W. LEWIS
United Press stan Correspondent.
WASHINGTON. Aug. 31-Con-
gressional fiscal experts saw in the
Social Security Act today a distinct
threat to plans for early balancing
Of the Federal budget because of
necessary permanent outlays reach
ing s4OO. 600. 900 annually.
Chairman James p. Buchanan of
the House Appropriations Commit
tee predicted the Federal admins
trative part Of the security program
would ultimately require from 5000
10 10000 new Federal workers.
Under the act appropriations Of
approximately s35O,0OO 900 will be
necessary for the next fiscal year.
This viii include S255, 500, 900 for old
age pension reserve purposes and
$40. 600, 900 for Federal aid to state
unemployment insurance setups.
Indicative Of the difficulties of
administration are the acts pro-
visions for exemption of various en-
ployed persons from the Old-age
benefit and unemployment insurance
systems.
Exemptions Are Varied
For example, on the basis Of 1880
employment figures, 100000 will
be excluded from the unemployment
insurance protection because of
occupations.
These include 100000 farm or
transient labor, house servants,
school teachers. officers and crews
of American vessels, government
workers, state or city employees. and
persons in the service Of any ex-
clusively operated organization for
religious charitable, scientific,
literary or educational purposes "or
for the prevention of cruelty to
children or animals"
In addition the employer would
only have TO pay the Federal IN
employment insurance tax if he
employs at least eight persons. On
the basis Of 1880 census figures g.
O00,0 900 persons worked in establish
ments employing fewer than eight
persons. State unemployment laws
under this setup would not be re-
CURED TO protect them.
OId-Age Pension Exemptions
The old-age pension feature of
the bill makes similar exemptions,
excluding approximately 10000, 900
persons in the same category as
those excluded from the unemploy-
ment tax with the exception of the
100000 employed in small estab-
lishments.
In this old-age tax, which both
employer and employe pay, the tax
will be entirely on the first $4,000 of
annual wages. Thus a $4,000 a
year man ultimately will pay a tax
of 3 per cent on $4,000 of his salary
only. and his employer the same.
The total number of owners. oper-
ators n self-employed persons, &C
cording to the 1880 census, was r.
067.O00. These include doctors, law
yerS. merchants and other profess
Sional workers. They do not come
under benefit provisions of the act.
Want Minimum
How much protection the $780,
900 workers under the unemploy-
ment insurance tax will get depends
entirely on on the state systems es-
tablished.
Department of Labor officials are.
however. opposed to any state sys-
tenn which fails TO give a worker
less than $3.50 a week for a IA to 20
week period Of unemployment. The
amount. social workers have held.
should be doubled where a worker
has a dependent family.
Under the cOntributory old-age
program the most a man. averaging
$4,000 a year for 80 years until he
is IS. could get from the government
would be S68.75. But he would get
it as long as he lived past 65 and if
he died before he received his full
share Of employer-emplOye contri-
buttons made in his behalf, the re-
mainder Of the reserve, plus interest,
would go to his heirs.
Board Included in Wages
Wages. as defined in the act for
tax purposes. included not only
cash payment to an employee. but
also such compensation for services
as room and board. An employee is
defined so as to include an officer
of a corporation. An alien employe.
provided he works in the United
States. would be covered. Services
performed outside the United States.
whether by a citizen or an alien
for an American company, are not
included.
II a church which is excluded
owns an apartment house. but all
income from the apartment house
is used for religious or charitable
purposes. the staff Of janitors and
others would not come under The
old-age provisions.
Scores Of similar delicate distinc-
tions are expected. when the law
becomes fully operative, TO jam the
security board with a mass of
claims. adjustment demands and
petitions which will make it the
largest independent agency in the
Federal government.