Askov American. [volume] (Askov, Pine County, Minn.) 1914-current, 1940-08-22
Social Security

The Federal Social Security
Board has issued report on its
first five years of existence. On
the basis of that report and OBJ
servations the ST. Paul Dispatch
published an editorial bringing
out the various phases of the
work. which covers the whole
field in a nut shell. The editorial
follows:
There are three main branches of
the social security program. These
are the insurance system for the aged
and survivors: the compensation sys-
tenn for unemployment; and the sys-
tenn of various public assistance
grants. In all the board has distri-
buted three billion dollars. The bulk
of this money, or S1,900,000,000 has
gone for the categories of public as
sistance, which include aids to the
needy aged, the blind and dependent
children. These grants are jointly
made by the Federal, state and local
governments, and are based on the
need of the beneficiary.
The old age and survivors inSur-
ance system pays out benefit checks
to workers who retire at IS and to
their wives, widows and orphans.
Unlike the grants of public assistance
out of the Federal, state and local
treasures, these payments are fl
nanced out of payroll taxes. It is a
forced savings system in which the
employer and employe both contri-
butte. The payments for this branch
of social security have amounted to
only 38 million dollars.
In time this function of social Sc
curity will become the most import
ant, while that of public assistance
will decline relatively. The bene-
ficiaries of old age insurance will
increase in number, and their bene-
fits will rise in amount, as more and
more of the employees originally
blanketed into the system reach the
age of retirement. These payments
are made as matter of earned right
not of need.
In an ideal social security system
there would come time when pub
lie assistance based on need would
practically disappear; but such ar
ideal is unattainable, and was not
in fact aimed at in the Social Secur-
ity Act. There are large classes Of
employees, who, because of the tech
nical difficulties of including them
are not covered by the insurance
system and, of course, make no con-
tribution. Some of these groups will
be brought under the insurance pro-
visions as means of overcoming the
difficulties are devised, but for this
reason and the normal hazards OF
life, there will always be need for
continuance of public assistance
granted out of need. It is to be hoped
however, that with the passage OF
time the emphasis on public assistance
will decline not only in relation to
the other payments, but absolutely
So far as unemployment compen-
sation is concerned, the experience OF
the Federal and state governments
has been of such a limited and un-
ASPA SoCiIoli'C LolOiC dS W lildhC IAii
wise any major recasting of the pro-
gram for the time being. The rev.
enues raised by the tax have proved
more than ample for the require
ments of the law, but the existence
of comfortable surplus should not
lead to any hasty sharp change OF
either the tax or the benefits. Ex-
perience in several states does indi-
cate that more emphasis should be
placed on merit rating concessions as
an inducement to employers to sta
billie employment.