Evening star., 1943-06-06
A Lona-Due Reform

In signing the DlSJrlcC anlenOeu
Unemployment Compensation Act,
the President referred with some
regret to the untimeliness of tax re-
duction and to the desirability of
reducing expenditures, paying off
debts, increasing reserves and alb
sorbing excess purchasing power by
larger contributions to all branches
of social security. But the President
manifestly, and very fairly, con-
cluded that this expression Of
desirable national policy and the spe-
cific condition to which the local
legislation applied, have very little in
common 1t would have been illog-
ical, if not unfairly discriminatory,
to make such a policy as the Presi-
dent outlined effective only in the
District of Columbia. while the Ma
ton as whole pursued another
course.
Here in the District local unem-
ployment insurance reserves had
reached about S36,o0O,0OO, a sum
swollen out of all proportion to any
reasonable demands for unemploy-
ment compensation. The accumula-
ton of such a fund was uneconomic,
and represented the results Of a sys-
tenn of taxation essentially unde-
sirable, in that taxes were being
collected far in excess of any demon
strable need for which they were
levied. The only method of reducing
this taxation, under the National
Social Security Act, was to institute
the so-called experience rating prin-
ciple, under which employers taxes
would be measured by their past
EMPLOYMENT records. Under this
principle the employer whose tax
contributions have exceeded the de-
mand for unemployment compensa-
ton by his employees enjoys a lower
tax rate.
Some forty-three States have re-
duced their unemployment compen-
sation tax rates in accordance with
this principle. The District now be-
comes the fourth jurisdiction to put
experience rating into effect this
year. To have closed the doors to
this tax reduction to District tax
payers, while other taxpayers all over
the country were utilizing it, would
have accomplished nothing in pur-
suance of the Presidents broad
policy toward increased social Sc
curitv contributions and benefits.
The place to apply that policy, OF
course. is through national legisla-
ton, such as Senator Wagner's new
bill.
AS it is, District employers and
employees benefit mutually under the
amendments which the Presidents
signature have made law. The wait
ing period is shortened. the benefits
increased to the highest scale in the
country, payroll taxes will be reduced
by about S7,G00O00 and the sound
principle of experience rating be-
comes effective.
This long delayed and important
reform is due, in large measure, to
the patient work of the Board OF
Trade and it's committees in foster
ing the interest and efforts Of Wash
ington men and organizations in
amending the law. The community
is also indebted to Chairman Ran
dolph of the House District Com
mittee, Representative Dirksen of
Illinois. the ranking minority men,
Der. and to Representative McGehee
of Mississippi. author of the amen
datory legislation in the House; to
Senator McCarran of the Senate
District Committee and Senator
Bushfield of South Dakota, who
piloted the measure through the
Senate. At least twelve different
bills, since 1910, have been prepared
and received some consideration, but
the measure which finally passed,
unanimously in both House and Sem
ate, was supported by practically all
District employers, as we'll as the Dis
trict Unemployment Compensation
Board