TOWNSEND PENSION PLAN

Nelson Evening Mail, Volume LXX, 21 May 1936, Page 12

TOWNSEND PENSION PLAN

EVIDENCE BEFORE COMMITTEE NOT LAUNCHED ONLY FOR “COLD CASH” [United Press Association—By Electric Telegraph—Copy right) (Received 21st May, 9.5 a.m.) WASHINGTON, 20th May. It was disclosed at the investigating committee to-day that Dr. Townsend, in a letter to Mr Robert Clements, his chief lieutenant, describing plans for the expansion of the Townsend weekly organ had written: “You and I have tlie world ky the (ail on a downhill pull,” and that there would be “a Initial of money” for those who stood by the pension drive. Questioned by the committee, Dr. Townsend denied that lie had launched nis scheme only lor "told cash” and had referred to its adherents as “old fossils,” allegations to that effect having been made by another witness.

The Townsend Plan, conceived by Dr. Francis E. Townsend, was announced at Long Beach, California, in die summer of 1934, and one of a sciies of inflationary and long-range projects of which tlie EL’IG plan ot Upton Sinclair and the ‘'Share our Wealth” movement of the late Senator Huey Long are the others best known. The'Townsend Plan, later supported by organisations iu forty-seven States and urged on tlie President by tlie signatures of 3,009,000 people, according to the announcement of its originator, is very simple. It proposes a 2 per cent, tax on “all financial and business transactions,” a proceeding which would raise, it is calculated, about 20,000,C00,C00 dollars (£4,009,000,000) a vear. This money will be used to provide pensions to all wage and salary caniers, who will be compulsorily retired from gainful pursuits at the age of 60 and thus make way for tlie absorption of the unemployed. Were this carried out to-day, Dr. Townsend asserts, there would be 4,000,000 jobs immediately available for those out of work. The' retired workers would then receive a standard pension of 200 dollars a month (£4O), which must be spent in Lin same month. Ultimately, the doctor calculates, the plan would remove 6,009,000 people from active work. In order to start the plan the Government would have to furnish the first month’s pensions; after that the sales tax would provide tlie finance. In this way, the doctor argues, there would be an enormous addition to the national spending oower and all industries would be extended to the utmost in order to provide uie necessary goods, llie future, as Di. Townsend sees it, would be a perpetual boom Latterly lie has sometimes referred to the possibility of a 10 per cent sales tax instead of 2 per cent., arguing that (lie great expansion of business would in effect reduce this higher figure very greatly. Governor Memam of” California has been one of the supporters of the plan, and when a vote was taken in the House of Representatives 54 members revealed themselves in favour of the scheme. In the nation, Dr Townsend has said, there are between 20,000,000 and 25,0C0,000 people who are behind his project.