Evening star., 1936-01-05

for men and women who, having been
employed for many years. choose to
retire or are forced to retire at the age
OF IS.
AS a further step toward social Sc
curity this year the Federal Govern
ment will-when Congress makes the
necessary appropriationS-give sub
stantial aid to the States for assist
ance to the needy aged, crippled or
otherwise dependent children, the
blind, and for the upbuilding Of the
States child welfare, maternal care
and health services in general.
In a very large sense this year will
witness the first step Of long-range
effort to prevent the recurrence of
what America has gone through in the
past five years.
First-Line Defense.
The social security act is not a
cule-all for the economic ills which
make depressions possible; it is rather
a first-line defense against unemploy-
ment. The act is intended to remove
the fear Of poverty during unemploy-
ment and the fear of destitution in
old age which for generations have
constantly hung over the heads Of mil
lions Of American wage earners. The
act is designed also to serve as an eco
nomic shock absorber for tie country
as whole in periods of protracted
and widespread unemployment.
Suppose the present social security
act had been in force in 1922 and all
Of our States had then adopted unem-
ployment compensation plans COM
parable to those now in force in the
District of Columbia, and in Wiscon-
sin. New Hampshire. California, Ore
gon and several other States. BY 1929,
SIC. 900 900, 900 would have been con-
tributed to the unemployment trust
fund and $4,000, ,000.00 paid out as
benefits to the unemployed during that
period.
Two Billion Dollar Reserve.
This would have left reserve of
50, 900 ,000, 900 at the outset of the
present depression. II is not difficult
to visualize the steadying and stimu-
lating effect on American business that
would have resulted from the disburse-
ment of this huge fund to those eligible
for unemployment compensation.
Nor is it difficult to visualize the ef-
feet on the morale Of the workers il
they had received these SIC, ZOO, ,000, ,00C
IN the form OF unemployment insurance
to which they were entitled as a mat
ter of course instead of as a relief
dole payable only after investigating
and finding that they were in dire need
So much for what might have been
The unemployment compensation
provisions of the social security act can
be explained very simply. A pay roll
tax will be levied on all employers ot
eight or more amounting to per cent
OF pay roll. Each employer, however
may get credit against this tax (up tc
go per cent? for contributions to &
State unemployment compensation
law which has been approved by the
I Social Security Board. The Federal tax
! Will DTulE HlOley lllIO IIc ScliSl
treasury. for the general purposes oi
/ the Government.
Will Keep Tax at Home.
This means that a State which
passes an unemployment compensa'
ton law will be able to keep nine.
tenths of this pay roll tax at home
for the use of its own unemployed
by collecting it as contributions rather
than letting the Federal Government
collect it as tax The passage oi
the State law will not cost the State
anything, If administration is efficient
for under the sociay security act the
Federal Government stands ready tc
grant to the States sufficient amounts
to pay all proper administrative ex.
penses. Nor will the State which act;
promptly be at any competitive dis
advantage with other States, for en-
ployers in States which do not act