Evening star., 1940-02-09
Help Needed

Employers in the District, subject
to an unemployment compensation
law which does violence to every
principle of sound taxation, are fac
ing the unhappy possibility that a
proposal to rectify some Of the
statutes more inequitable features
may be sacrificed to a conflict of
interests which does not concern
them and which has not the slight
est relation to the unemployment
situation in Washington. If relief
is to be secured from the present
intolerable setup two things are
necessary-the glaring injustices of
the present law must be made ap-
parent to Congress and the spokes-
men for local interests must join
hands in support Of the changes that
are to be sought.
The force of logic and the dictates
OF fair play are Overwhelmingly on
the side of the proponents of revision.
With the tax at three per cent, Dis
trlct employers are paying annually
into the unemployment compensa-
ton fund four times the amount
that is being disbursed in benefits.
Last year receipts were $6,OOO,0O0,
disbursements about 81, 100000. Un-
der proposed new law, scheduled
to be called up in the House Monday,
the tax would be cut to 27 per cent
and the benefits increased from
present maximum of SIG for fifteen
weeks to maximum of $40 for
twenty weeks. Even with these i'm
proved benefits and the lowered tax
rate, it is estimated, receipts would
still be at least twice the total of
disbursements. And behind this
eminently safe ratio there stands a
surplus already amounting to more
than $4,000, ,000-enough to pay the
liberalized benefits for approximately
eight years if not another dollar
were paid into the compensation
fund.
These statistics add up to an un-
ansWerable argument in favor of
revision of the law, and if the equities
within the District were the sole
consideration the needed changes
probably could be effected with little
difficulty. But that, unfortunately,
is not the case
Representatives of important busi-
ness interests outside the District
have come here to resist the pro-
posed changes. Presumably they are
not concerned about the local tax
rate and would not oppose it's reduc-
ton, but they do object to the pro-
posal to liberalize the benefits, fear
ing that the fixing of higher stand
ards in the Capital might some day
lead to their establishment in the
States, none of which now matches
the contemplated local payments. At
the other extreme are various en-
ploye organizations, possibly sup
ported tacitly by officials of the Fed
eral social security system, who are
vigorously opposing any reduction in
, the local tax rate-again for reasons
OF precedent-unless accompanied
by increased benefits. In the middle
is the District employer, and his
predicament is not made easier by
the fact that the Board of Trade and
the Merchants and Manufacturers
Association have requested that
action on the new bill be deferred
until they have had more time to
study provisions which they believe
to be harmful.
These latter groups are not op-
posed to the proposal to increase
maximum benefits to $40 for twenty
weeks, but they do object to the So
called partial benefit" provision,
which is not clearly worded and
which might result in the payment
of unreasonable benefits inequitably
distributed among the recipients.
Spokesman for the local trade groups
also are strongly opposed to pro-
vision of the new bill which would
nullify section of the existing stat
ute directing the setting up of
merit rating" system next year.
Under the merit-rating system, which
is provided for in thirty-nine States
and adopted for use in five, tax diff
ferentials would be established in
favor of employers with records of
stable employment. Abandonment in
the District of the merit-rattng pro-
vision nova step favored by Off
cials of the local and perhaps of the
Federal system-Would have the eff
feet of needlessly penalizing employ
ers who provide steady employment,
because tax receipts still would be
more than adequate to meet all COM
pensation demands.
To secure relief from the manifest
injustices of the existing situation
an inequity which threatens to be-
come permanently saddled on the
communicative District has no
other recourse than to appeal to the
Congress, which sits as a State leg
islature for the community in mat
ters of this kind. The request of the
Districts spokesmen is supported by
every rule of reason and unless the
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