Evening star., 1936-06-16
SOCIAL SECURITY
TERMED BALANCE
Altmeyer, in Forum Talk,
Says System Designed to
Encourage Initiative.
Continued From Ninth pase)

rSueTdl \OfcfTulS1lb IuAkcS u pos
sible for q State to enact such q
law by levying q uniform Federal
pay roll tax ON employers, which
went into effect on January /, 1896.
This Federal pay roll tax must be
paid by employers regardless OF
whether or not they operate in q
State that has unemployment com.
pensation law. However, II they op-
crate In State that does have q
satisfactory unemployment compen-
sation law they will receive credit
for their contributions made under
such State law up to 90 per cent
of the Federal tax.
Money Goes to u. 8. Treasury.
The Federal standards which q
State unemployment compensation act
must meet in order that an EN-.
ployer's contributions hereunder may
be used to offset the Federal tax
are few and simple. The chief one
is that all money received must be
paid into the United States Treasury
for safe keeping. and when drawn out
must be used only for the payment
of benefits.
The straight Federal old-age retire.
ment benefits system which Will pro-
vide benefits to workers in direct pro-
portion to the total wages earned by
them will not 90 into effect until
January 1, 1897. The minimum
monthly benefit will be $40 and the
maximum will be $85. These monthly
payments will commence January /,
1912, and will be paid to qualified
individuals who become IS years Of
age after that date and retire from
regular employment. While the
monthly old-age retirement benefits will
not be payable until 1912, lump-sum
payments will be made to workers who
become 65 years OF age before that
date, and to the heirs of workers who
die before that date. 1t Is estimated
that 100000 persons will be eligible
for such benefits in 1887, and more
than 1,500,000 before 1912. 1t Is most
important to emphasize again that
these payments will be made as q
matter Of right and not on the basis
Of need. That is to say, qualified
individuals will receive these benefits
regardless Of the amount of property
or income they possess, just as they
would receive benefits from private
insurance company to which they
had paid premiums.
Some Employment Excluded.
All employers of one or more per-
sons are covered by the old-age re-
tirement benefits provisions of the
social security act, except those en-
gagged in certain excluded employ.
ments A tax will be levied which
must be shared equally by employers
and employees. This tax will amount
to per cent of wages not in excess
of $4,000 per year for the 3 years
beginning January ], 1851 per cent
from the employe and per cent from
the employer. The tax rate is in
creased by L per cent at three-year
intervals until it reaches maximum
of s per cent in 1949, when the en-
ployer will contribute per cent and
the employe per cent.
Several concrete examples viii best
illustrate how much the monthly
benefit viii be. Let US first take the
case OF . young man, IS years Of
age, who enters the system on Jan.
uary 1, 1887, and remains in the
system for 30 years. II he earned an
average Of 500 per month during
that period he would receive q
monthly pension Of $42.50 for the
remainder Of his life. Now let US
take the case Of an older person who
was so years Of age when he entered
the system on January I, 1887, and
earns en- average monthly wage OF
$l00. When he retires five years later
he will receive monthly pension of
$17.50. The young man, during the
course OF his life, would have been
taxed $500, and his employer would
have been taxed $500, but If he lives
out normal life expectancy he would
receive in benefits $4,000. The older
men would have been taxed only $72
and his employer an equal sum, but
he would receive in benefits If he
lives out his normal life expectancy,
total Of $2,500.
States Keystone In System.
The importance Of State response
bility under the social security act is
apparent when 1t is realized that the