I believe that we should be thinking in terms of developing
for this country a unified comprehensive system of contributory
social insurance which would cover all of the major economic hazards
to which the workers of this country are subjected, namely, old
age, disability, death, and unemployment. We already have a federal
system providing some protection against loss of income due to old
age and premature death, and a federal-state system providing some
protection against unemployment, but we have no nationwide system
providing protection against the hazards of ill health and disability.
Under a unified comprehensive system of social insurance there would
be no gaps, no overlaps, and no discrepancies in the protection
afforded. Such a system could operate with a maximum degree of simplicity
and efficiency, since there would be only one contribution, one
report, one record, and one local office to which employers and
employees could go to ascertain their rights and duties.
The contributory social insurance system should, of course, be
extended to all employees and (except in the case of unemployment
and temporary disability) should be extended to all self-employed
persons as well. If this were done, we would be providing a minimum
basic security for the people of this country upon which they would
have a greater opportunity to build a higher degree of security
through individual savings and private insurance. In other words,
this minimum basic security would constitute a safety net protecting
the workers of this country against these major economic hazards,
not a feather bed releasing them from the necessity of helping themselves.
While I believe responsibility for the establishment and maintenance
of this unified comprehensive system of social insurance should
be centralized in the Federal Government, I believe that the actual
administration of the system should be highly decentralized with
representative advisory committees and appeals councils in the several
States.
Even with the comprehensive social insurance system proposed, it
would be too much to expect that all destitution would be eliminated.
No system of insurance can insure against hazards that have already
occurred or can provide adequate protection under all conceivable
circumstances. Therefore, I believe that we should not only maintain
but greatly strengthen our present system of public assistance.
I believe that this system should continue to be administered by
the States. However, I believe that the Federal Government should
make grants to the States for assistance rendered to any needy persons,
not only to the needy aged, the needy blind, and dependent children,
as is the case at the present time. I also believe that there should
be special federal aid for States with low per capita income.
An expanded social security system such as I have outlined can
play a vitally important role in the economic readjustment and reconstruction
that will be necessary when the war ends. On the one hand, it can
provide protection to individuals and families against the loss
of income which they may suffer for one reason or another after
the war, when a decline from the high levels of war-time production
will increase the burden of the various hazards. On the other hand,
from the standpoint of the economic system as a whole, social security
can aid in maintaining consumer purchasing power when the national
income exhibits a tendency to shrink and thus can assist in maintaining
employment at a higher level.
The obvious question which will occur to many who may agree with
the inherent desirability of having a comprehensive social security
system available at the end of the war is whether the present is
a practical and appropriate time for action. The enormous outlays
and the vast administrative undertakings now necessary for the prosecution
of the war may appear to suggest that action be deferred until after
the war is won. The answer is that unless action is taken now there
is grave danger that the postwar period will arrive before a well-rounded
social security system can be put into successful operation. A successful
social security system cannot be improvised overnight.
As a matter of fact, the extension of social security now would
not only not interfere with but would greatly aid in the successful
prosecution of the war. The greater sense of security which would
result would make the people of this great Nation more effective
defenders of democracy. This has been amply demonstrated in Great
Britain, where social security has already been extended while the
bombers roared overhead and where it is now proposed that there
be far greater extension.
Entirely apart from the increased human happiness and well-being
that could result, the fact is that immediate expansion of the social
Security system is highly desirable from the standpoint of the Nation's
economic and fiscal circumstances. Two of the major economic problems
of the war effort are to control inflation and to obtain revenues
through taxation or borrowing or both. The enlarged excess of contributions
over disbursements which would occur during the war period would
curtail current purchasing power and serve as a potent force in
the fight against inflation. Investment of the excess in government
obligations would make corresponding sums available to the Treasury.
As President Roosevelt has said, "This is one case in which social
and fiscal objectives, war and postwar aims, are in full accord.
Expanded social security, together with other fiscal measures, would
set up a bulwark of economic security for the people now and after
the war and at the same time would provide anti-inflationary sources
for financing the war."
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