The Social Security Act

The Social Security Act

Activity 1, Group: A | B | C | D

Activity 2 | 3

Activity One, Group A: Debating the Social Security Act

Review the Great Depression time line and the section entitled “The Stock Market Crash and The Great Depression” on The Historical Background and Development of Social Security page, and answer the questions below.

• Great Depression timeline
• The Historical Background and Development of Social Security
• How may the Great Depression have affected the lives of working class Americans?
• How may the Great Depression have affected older workers differently from younger workers?

Read the Preamble to the Social Security Act, and answer the questions below.

• How was the Social Security Act going to provide for Americans in a different way than they had previously been provided for?
• Why do you believe the Social Security Act identified these particular groups in its preamble?
• According to the preamble, what problem is the Social Security Act solving? Under this system, what does the federal government do and what do the states do? Why divide their duties in this way?

Read the following excerpt from President's Message to Congress, January 17, 1935, New Deal Network and work collaboratively with the rest of your group to answer the questions that follow.

Excerpt from President's Message to Congress, January 17, 1935, New Deal Network.

MESSAGE FROM THE PRESIDENT OF THE UNITED STATES TRANSMITTING A RECOMMENDATION FOR LEGISLATION ON THE SUBJECT OF ECONOMIC SECURITY

It is my best judgment that this legislation should be brought forward with a minimum of delay. Federal action is necessary to, and conditioned upon, the action of States. Forty-four legislatures are meeting or will meet soon. In order that the necessary State action may be taken promptly it is important that the Federal Government proceed speedily.

The detailed report of the Committee sets forth a series of proposals that will appeal to the sound sense of the American people. It has not attempted the impossible, nor has it failed to exercise sound caution and consideration of all of the factors concerned: the national credit, the rights and responsibilities of States, the capacity of industry to assume financial responsibilities and the fundamental necessity of proceeding in a manner that will merit the enthusiastic support of citizens of all sorts.

It is overwhelmingly important to avoid any danger of permanently discrediting the sound and necessary policy of Federal legislation for economic security by attempting to apply it on too ambitious a scale before actual experience has provided guidance for the permanently safe direction of such efforts. The place of such a fundamental in our future civilization is too precious to be jeopardized now by extravagant action. It is a sound idea - a sound ideal. Most of the other advanced countries of the world have already adopted it and their experience affords the knowledge that social insurance can be made a sound and workable project.

Three principles should be observed in legislation on this subject. First, the system adopted, except for the money necessary to initiate it, should be self-sustaining in the sense that funds for the payment of insurance benefits should not come from the proceeds of general taxation. Second, excepting in old-age insurance, actual management should be left to the States subject to standards established by the Federal Government. Third, sound financial management of the funds and the reserves, and protection of the credit structure of the Nation should be assured by retaining Federal control over all funds through trustees in the Treasury of the United States.

At this time, I recommend the following types of legislation looking to economic security:

   1. Unemployment compensation.
   2. Old-age benefits, including compulsory and voluntary annuities.
   3. Federal aid to dependent children through grants to States for the support of existing mothers' pension systems and for services for the protection and care of homeless, neglected, dependent, and crippled children.
   4. Additional Federal aid to State and local public-health agencies and the strengthening of the Federal Public Health Service. I am not at this time recommending the adoption of so-called "health insurance," although groups representing the medical profession are cooperating with the Federal Government in the further study of the subject and definite progress is being made.

...In the important field of security for our old people, it seems necessary to adopt three principles: First, noncontributory old-age pensions for those who are now too old to build up their own insurance. It is, of course, clear that for perhaps 30 years to come funds will have to be provided by the States and the Federal Government to meet these pensions. Second, compulsory contributory annuities which in time will establish a self-supporting system for those now young and for future generations. Third, voluntary contributory annuities by which individual initiative can increase the annual amounts received in old age. It is proposed that the Federal Government assume one-half of the cost of the old-age pension plan, which ought ultimately to be supplanted by self-supporting annuity plans.

• What role is assigned to government in the reading? (For instance, does the speaker call for strong federal government oversight, state control, or very limited governmental support?)
• Does the speaker believe that the Social Security Act will help or harm the people of the United States?
• What is the speaker's reasoning for his or her argument? Pay particular attention to whether their position is based on evidence, logic, or economic and political ideology.
• Do you agree or disagree with the author of your document? Why or why not?
• Do you think contemporaries would have found his or her arguments convincing? Why or Why not?

Activity One, Group B: Debating the Social Security Act

Review the Great Depression time line and the section entitled "The Stock Market Crash and The Great Depression" on The Historical Background and Development of Social Security page, and answer the questions below.

• Great Depression timeline
• The Historical Background and Development of Social Security
• How may the Great Depression have affected the lives of working class Americans?
• How may the Great Depression have affected older workers differently from younger workers?

Read the Preamble to the Social Security Act, and answer the questions below.

• How was the Social Security Act going to provide for Americans in a different way than they had previously been provided for?
• Why do you believe the Social Security Act identified these particular groups in its preamble?
• According to the preamble, what problem is the Social Security Act solving? Under this system, what does the federal government do and what do the states do? Why divide their duties in this way?

Read the following text, and work collaboratively with the rest of your group to answer the questions that follow.

Excerpt from George B. Chandler, representing the Ohio Chamber of Commerce, in Senate Hearings on Roosevelt’s "Economic Security Bill," 1935.

STATEMENT OF GEORGE B. CHANDLER, REPRESENTING THE OHIO CHAMBER OF COMMERCE

May I first be permitted to indulge in two general observations: first, that Ohio business protests against the coercion of the States by the Federal Government as represented by the assessment on pay rolls and in other ways. We deem this procedure repugnant to American institutions, destructive of the historic relationships between State and Nation, and calculated in the end to do permanent harm and little immediate good.

... Ohio business believes that legislation of this class will permanently weaken the fibre of the American people. Self-reliance has been the key to American success. It has been the initiative, thrift, and self-sacrificing foresight of the individual and the family which has brought this country to its proud position. And I say, "proud position" advisedly even in the midst of this depression. We are incomparably in a better position than any other nation in the world.

This legislation starts this country on a pathway from which there will be no retreat in the course of the next two generations. When the time comes, as it surely will, to reverse these policies, incalculable harm will have been done to the character of the population.

Only the other day when there was a blizzard in New York, it was impossible in this period of unemployment to get men to work. I live in a suburb of Columbus, where men used to apply at the door every day for work and we tried to give them work. No more apply any more; there is no application for work.

Gentlemen of this committee, I want to say in all seriousness that this Nation can recover and will recover from the economic depression in which we are now floundering. We recovered in the panic of 1873, which ran for 6 years and was about as serious as this. We recovered under our own power; but, gentlemen, the loss to the morale of the people through this period and through the methods which have been adopted to alleviate it is something which I will not say is incurable, but whose result will persist for one or two generations; it is the most grave situation which this Nation is facing. And, to enter upon a broad policy whereby the individual is relieved of the responsibility for his unemployment, for his old age, for the care of his children, you are entering upon a pathway which has destroyed other nations. The downfall of Rome started with corn laws, and legislation of that type. I say that and I hope you will be patient with these general observations.

• What role is assigned to government in the reading? (For instance, does the speaker call for strong federal government oversight, state control, or very limited governmental support?)
• Does the speaker believe that the Social Security Act will help or harm the people of the United States?
• What is the speaker's reasoning for his or her argument? Pay particular attention to whether their position is based on evidence, logic, or economic and political ideology.
• Do you agree or disagree with the author of your document? Why or why not?
• Do you think contemporaries would have found his or her arguments convincing? Why or Why not?

Activity One, Group C: Debating the Social Security Act

Review the Great Depression time line and the section entitled "The Stock Market Crash and The Great Depression" on The Historical Background and Development of Social Security page, and answer the questions below.

• Great Depression timeline
• The Historical Background and Development of Social Security

• How may the Great Depression have affected the lives of working class Americans?
• How may the Great Depression have affected older workers differently from younger workers?

Read the Preamble to the Social Security Act, and answer the questions below.

• How was the Social Security Act going to provide for Americans in a different way than they had previously been provided for?
• Why do you believe the Social Security Act identified these particular groups in its preamble?
• According to the preamble, what problem is the Social Security Act solving? Under this system, what does the federal government do and what do the states do? Why divide their duties in this way?

Read the following text, and work collaboratively with the rest of your group to answer the questions that follow.

Alfred M. Landon, "I Will Not Promise the Moon," September 26, 1936

• What role is assigned to government in the reading? (For instance, does the speaker call for strong federal government oversight, state control, or very limited governmental support?)
• Does the speaker believe that the Social Security Act will help or harm the people of the United States?
• What is the speaker's reasoning for his or her argument? Pay particular attention to whether their position is based on evidence, logic, or economic and political ideology.
• Do you agree or disagree with the author of your document? Why or why not?
• Do you think contemporaries would have found his or her arguments convincing? Why or Why not?

Activity One, Group D: Debating the Social Security Act

Review the Great Depression time line and the section entitled "The Stock Market Crash and The Great Depression" on The Historical Background and Development of Social Security page, and answer the questions below.

• Great Depression timeline
• The Historical Background and Development of Social Security
• How may the Great Depression have affected the lives of working class Americans?
• How may the Great Depression have affected older workers differently from younger workers?

Read the Preamble to the Social Security Act, and answer the questions below.

• How was the Social Security Act going to provide for Americans in a different way than they had previously been provided for?
• Why do you believe the Social Security Act identified these particular groups in its preamble?
• According to the preamble, what problem is the Social Security Act solving? Under this system, what does the federal government do and what do the states do? Why divide their duties in this way?

Read the following text, and work collaboratively with the rest of your group to answer the questions that follow.

Excerpt from "Jackson's Voice Clear on Social Security Issues" by biographer John Q. Barrett, including quotes from Jackson’s defense of Social Security before the Supreme Court in Helvering v. Davis, 1937.

ATTORNEY GENERAL ROBERT JACKSON

Arguments from the Helvering v. Davis Supreme Court Case (1937)

... The failure of private pension plans is explored by the evidence, and pointed out in our brief. The failure of private charity to meet this problem is conclusively shown by the figures of the Bureau of Internal Revenue. In 1928 the persons with $3 million and up of income contributed an average of $25,400 to purposes for which they were entitled to the charitable deduction. By 1931 they had reduced those contributions, the same group, to $12,900 average, showing that the well to do retrenched in their charitable contributions during the period of Depression, although the need was greater ...

The resources of the States have been declining. Real estate reserved to the States as a source of taxation has been taxed to the limit of its capacity to bear, and personalty has never been successfully taxed locally. The Federal Government, which is able to tax incomes and to lay excises, has sources of revenue which have been drying up for the States, not because of any change in the legal system but because the economic emphasis on personal property has left the States without a comparative source of revenue such as they had at the beginning of our constitutional system...

The condition which is promised as an implication of our system, that thrift would be followed by plenty, failed in the Depression, for the man who had responded to the inducements and had accumulated a bank account and selected the wrong bank, or the man who had saved to purchase a home, found himself in the same position as the one who had never saved at all. In fact, the man who had not tried to acquire a home perhaps was better off because he was not faced with a deficiency judgment. The unfortunate consequences of this Depression bring home to us the fact that self-denial had not assured comfortable age ...

[I]f we are to review in this Court the question whether Congress has served the general welfare in fact, I am frank to admit that we face a tradition of 150 years of practice that is against the making of old-age relief a matter of national welfare. But I would call your attention to the fact that old-age welfare has been a constantly widening concern. The matter of the care of the old was at one time a matter for the family only. It became gradually a matter for the town poormaster if the family failed. From the town poormaster it became a matter for the county with its poorhouse, and then the State, because of failures of counties, intervened, and now we argue that it has become a matter of national welfare and this old-age-pension system was set up in the hope that it would make true the promise to men that if they were thrifty and industrious and self-disciplined their age would be spared at least extreme poverty. This plan does no more than spare extreme poverty, and may not in many instances do that. This plan was that if the workman during his productive years would contribute to the Treasury of the United States, then the Treasury of the United States in his unproductive years would contribute to his necessities ...

• What role is assigned to government in the reading? (For instance, does the speaker call for strong federal government oversight, state control, or very limited governmental support?)
• Does the speaker believe that the Social Security Act will help or harm the people of the United States?
• What is the speaker's reasoning for his or her argument? Pay particular attention to whether their position is based on evidence, logic, or economic and political ideology.
• Do you agree or disagree with the author of your document? Why or why not?
• Do you think contemporaries would have found his or her arguments convincing? Why or Why not?

Activity Two: "Selling" the Social Security Act

View each of the following posters, which were produced by the federal government to build support for the Social Security Act among the American public.

• Poster 1: Social Security Poster: More Security for the American Family, Old Man
• Poster 2: Social Security Poster: More Security for the American Family, Mother and Child
• Poster 3: Social Security Poster: More Security for the American Family, Widow

For each image, answer the questions below.

• Why do you think this poster was created for the Social Security Act?
• Who is portrayed in the poster? Which Americans are NOT portrayed in the posters? Why might they be missing from these images?
• In order to "sell" the Social Security Act to the nation, why do you believe the Roosevelt administration chose these images? Identify the ways in which the federal government attempted to "sell" the Social Security Act to the American people. Explain the reasons for your answers.
• How else could the federal government have "sold" the Social Security Act?

This next image was not among those used by the government to promote the Social Security Act. Answer the questions below, which require that you compare this photograph to the three posters you have already worked with in this activity.

• Training mid-wives photo
• How are the people represented in this picture different than those in the three Social Security Act posters you previously viewed? What might explain this difference?
• How does the photo below, showing the training of mid-wives, portray groups not included in the Social Security Act posters?
• Do the posters for the Social Security Act indicate any signs of gender or race bias? If so, why do you think that is?

Activity Three: Debating the Social Security Act on the Radio

Read a short overview of Social Security and African Americans and the New Deal.

• Social Security
• African Americans and the New Deal

Next, listen to, and read a transcript of Francis Perkins' statements from a debate on the Social Security Act on December 19, 1935. In order to listen, follow these steps:

   1. Go to http://www.ssa.gov/history/1935radiodebate.html
   2. Right-click on "RealAudio Format" beneath "Remarks By Frances Perkins."
   3. Choose "Save Target As . . ." and save the file to your computer. Be sure to note where you are saving it (by default the file will be titled "perkins").
   4. Open the file using RealPlayer audio and video player. If you do not already have this program on your computer, you can download it from http://www.real.com/
   5. Within RealPlayer, advance the music file to minute 11:20.
   6. Proceed to listen through minute 14:50.

After completing these steps, and reading the transcript of the speech below, answer the questions that follow.

Transcript of minutes 11:20 to 14:50 of Francis Perkins' statements from America's Town Meeting of the Air, "Should We Plan for Social Security?" of December 19, 1935.

"The Social Security Act provides, if I may take out time to outline what it is directly, provides federal grants and aids for old age pensions provided for in the state, to those who are now both aged and indigent. The federal government will match the state, dollar for dollar, up to fifteen dollars per month by the federal government, and any amount more, which the state may seem fit to add in providing free pensions for all people who are without other means of support. The state must, however, comply with certain standards in order to get this federal grant and aid. Certain standards, in their old age pensions, administrations, and laws. Including an age limit of sixty five, although seventy is the usual rule today, and a residents requirement of not more than five years other than the nine years preceding application. Thirty nine states already have old age pensions, but most, many of the state laws have to be revised in order to meet these standards. The same sort of assistance is given by federal grants and aid to the needed blind and twenty eight states now make many of them inadequate provisions for assistance to the needed blind. The bill also provides federal grants and aid for mothers pensions where there is a dependent family without a bread winner. Forty six states have pension laws for mothers with dependent children, but the funds are so inadequate that about, only about one hundred and nine thousand families in the United States are receiving regular mother's aid allowances under state laws, although there are three times that numbers of fatherless families now on the relief role. The inadequacy of the state funds and irregularity of their administration, has been the cause of this anomaly. Under the present act, the state may secure federal aid of one third of their total expenditure on fatherless families up to eighteen dollars a month for one child and twelve dollars for each additional child in the household to enable mothers to take care of their own children at home. And this, of course, will be an extraordinary, a great expansion of a principle of taking care of dependent children in their own home. The act also provides grants and aid for child and maternal healthcare. It provides grants and aid for neglected and handicapped children. It provides grants and aid by the federal government to the state for health protection. The federal appropriation will be allotted to the states for strengthening their present public health services or developing public health services where they have none. This, of course, in the direction of preventing illness. The state also provides two other forms of social security which are in the insurance aspect rather than the relief aspect. The act provides for compulsory old age insurance under United States government supervision. The problem with the wage earner, too old to be hired is growing yearly in size. Today, six percent of our population is sixty five years of age and over, and by 1965 the percentage will be doubled. To prevent future old aged dependency as far as possible, now is the time to set up a compulsory old age insurance program"

• Why did Francis Perkins think that the Social Security Act was a good program?
• How did Francis Perkins describe the role of the states and federal government in administering this program?
• If you were listening to this speech as an audience member how would you have responded?

Next, you will listen to and read a transcript of George Sokolsky's statements from this same debate. In order to listen, follow these steps:

   1. Go to http://www.ssa.gov/history/1935radiodebate.html
   2. Right-click on "RealAudio Format" beneath "Remarks By George Sokolsky."
   3. Choose "Save Target As . . ." and save the file to your computer. Be sure to note where you are saving it (by default the file will be titled "sokolsky").
   4. Open the file using RealPlayer audio and video player. If you do not already have this program on your computer, you can download it from http://www.real.com/
   5. Within RealPlayer, advance the music file to minute 6:22.
   6. Proceed to listen through minute 9:35.

After completing these steps, and reading the transcript of the speech below, answer the questions that follow.

Transcript of minutes 6:22 to 9:35 of George Sokolsky's statements from America's Town Meeting of the Air, "Should We Plan for Social Security?" of December 19, 1935.

"Human liberty, my friends, is a rare privilege. Not likely gained, nor is it to be sacrificed for bread alone, fore without it, the guaranteed, the secured bread becomes the wages of a driven slave. There are no poor, no unemployed, no indigent, but I also want liberty. I want the human right which my ancestors never enjoyed, but which, to me, are more precious than life. Fore without them, life is a concha of crushing death. It is upon this basis that I shall now devote myself to the specific plan for social security, the federal government's Social Security Act passed by Congress and signed by the president and now is the law of the land. When we talk of that we have something very specific before us. Pretty close to five billion dollars annually within the next 15 years to be met by taxes which will produce increased prices, reduced profits and possibly even reduce the employment of labor. We need not be abstract or idealistic about this plan. It is here with us and we have to face it. Curiously enough, one of the first obstacles we encounter in this plan arises from our form of government. Clearly the rights to provide for unemployment insurance rests with the state but the federal government has the right to tax us too. The authors of this bill face their dilemma which in time, we must all encounter. They wanted to do something which they are not allowed to do. They got around their difficulty by a very simple device. They would tax all the payrolls of the United States and then they would remit ninety percent of the tax if the burdened citizens could free their state, could force their state legislature to pass such an act as the federal government wanted pass, passed. Here is a new principle of policy, a new departure from liberty. The federal government cannot coerce the state to pass a law, but it can offer the citizens of each state a bait, a monetary bait to have the law passed. Ninety percent of the federal tax is to be remitted if the state passes a law to conform to federal standards. The remaining ten percent remains with the federal government, but the federal government does not engage in the unemployment insurance business except to make grants and aids for administrative purposes for the state. The actual administration of the business is admittedly the function of the state therefore the remaining ten percent has no function. It is either a clear profit for the federal government, a hidden form of taxation, or it is a service charge for coercion."

• How does George Sokolsky criticize the Social Security Act?
• How did George Sokolsky describe the role of the states and federal government in administering this program?
• If you were listening to this speech as an audience member how would you have responded?