Evening star., 1940-03-21
Destructive Muneuvers

Destructive Muneuvers
Agreement was reached recently
among representatives of local la
bor-or an element of local labor
the taxpaying employers and the
District Unemployment Compensa-
ton Board on proposed amendment
OF the unemployment compensation
law for the District. Briefly de-
scribed, these amendments brought
the local law into line with the
national act by permitting reduction
of the pay roll tax to 27 per cent and
elimination of the tax on salaries
over three thousand dollars; benefits
under the act were liberalized and
formula was provided for application
Of an experience rating, or merit
system, under which employers DEM
onstrating steady employment would
receive still further tax reduction.
But the National. Social Security
Board and the national labor organi-
cations, which for different reasons
have fought the experience rating
system, stepped in and brought pres
sure enough to kill the amendments
before they were drafted. Substitute
amendments have been prepared
which promise substantial tax reduc-
tion to employers and broader bene-
fits to unemployed labor But there
is little use in lodging the fact that
these new amendments, which might
be acceptable enough in Washington,
will have little chance of passage by
Congress for two reasons: First, they
require amendment not only of the
local act but of the national act,
and amendment of the national act
is hazardous legislative undertak-
ing; second, the broadened benefits
OF the local amendments go so much
further than the States that national
lobbies of employers, interested only
In the effect of the proposed amend
ments on State laws, will undoubt-
edly fight such liberalization.
The situation, in other words,
writes another disgraceful commen-
tary on the fact that no one in the
picture is looking out for the inter-
ests of the District of Columbia. The
national labor unions are naturally
interested in getting as high a scale
OF unemployment benefits in the
District as the traffic will bear, in
order to set an example for the
States. Outside business interests
are as watchful against increasing
local benefits because of the possible
effect back home. The Social Secur-
tty Board likewise is interested in
the national act and does not seem to
approve of the experience rating sys-
tenn at this time. AS far as the Dis
trict Unemployment Compensation
Board is concerned, it has made no
notable contribution in any direction.
Here in the District of Columbia
some seven million dollars a year
in pay roll taxes is being collected,
reserve fund approximating seven
teen million dollars has been accu-
mulated already and even with re-
duction of the local tax to 81 per cent
this reserve will continue to increase
because the tax so greatly exceeds
the demands. The opportunity is
here for an intelligent demonstration
OF what can be done, both in liberal
lied payments and in providing en-
ployers with incentive to reduce their
tax loads through maintaining steady
employment.
1t should be the concern, not only
OF the District committees in Con-
gress but of the Social Security
Board to work for a model law in
the District of Columbia, fair to the
employer and the employe alike; a
law that will reduce local taxes to
the level of reasonable benefit pay
ments after accumulation of an
adequate reserve; one that will hold
out some incentive in tax reduction
to the employer who increases and
stabilizes employment, rather than
to penalize such employers, as at
present, and encourage reduction of
employment in order to reduce taxes.
The Social Security Board and the
national labor unions are defeating
their own purposes by moves which
delay proper amendment and which
in the end will discredit the local law
as unjust, unreasonable and clumsily
administered, and with it the whole
principle of unemployment compen-
sation.