AMERICAN SOCIAL SECURITY

New Zealand Herald, Volume LXXIII, Issue 22404, 28 April 1936, Page 10

AMERICAN SOCIAL SECURITY

The United States started late in the field of social legislation, but this year the sum to be found jointly by the Federal and States Governments for old-age pensions and unemployment insurance is reported to be £150,000,000. This is the cost of the measures embodied in President Roosevelt's Social Security Act passed by Congress last August. Two factors have delayed the acceptance of social schemes in America that for years have been a commonplace in Europe. First came the deep-seated faith in the doctrine of individualism. Second there was the practical difficulty that -such matters, under the Constitution, were the concern of the States, and it was impossible to secure unanimity or uniformity of action. States have been reluctant to pass labour legislation which would put employers in their territory at a competitive disadvantage with States without such laws. Moreover the indigent might flock into benevolentlyminded States. Even so, prior to the passing of the Federal law, 28 out of the 48 States had old-age pension laws. Mr. Roosevelt's scheme is designed to ease the burden of States undertaking obligations to the aged and the unemployed by giving Federal aid, which is supposed to be at least matched by the States. On the figures published this morning, however, Washington appears to be assuming a good deal more than half the liability. For both the aged and the unemployed, the Act provides for direct aid temporarily, but these "uncovenanted benefits"—to borrow a phrase from British experience—are to be superseded in both cases by a system of compulsory and contributory insurance. It will be interesting to see whether America has been able to devise a scheme in these ■special directions that proves financially self-supporting.