Evening Star Newspaper, January 31, 1930, Page 27

LIBERAL " RETIREMENT LAW, Senator Dale Explains Rea- sons in National Radio Forum Address Last Night. From Pirst Page) Government and the employes to men and women on the pay roll after (Continu -y keep | their health had fafled, he said, and| M‘ efficiency had been consequently red. Any man or woman who has come down through long years of service to the Government has a well earned right to consideration,” he said. “To concede tHat right is not charity, but justice.” Senator Dale’s address, in full, fol- WS Associates in the Civil Service and La- dies and Gentlemen of the Public We Try to Serve: Every enlightened citizen takes interest in the welfare of the Gov- | ernment. He would have his Govern- ment in all respects that of which he sould be proud. He would have his Gov- ernment administer its affairs humanely, efficiently and economically. No Gov- ernment can at this time be humane, efficient or economical without a well regulated system of retirement of its employes. Therefore, all enlightened citizens of the Republic are interested in Tetirement legislation. ANl such legis- Jation, however, is of comparatively re- the civilized nations of aystem following the World War. Our own country has had a retire- ment system in operation for nine com- plete vears. Chiefly because of good conditions in the service, as compared with other countries, and for the reason that employes were not di when had become incapacitated, our Con- gress did not enact this legislation until all other civilized governments had adopted it. Approves Employes’ Confribution. Under existing law, the employes eon- tribute seven-eights of the normal cost of the retirement system. Largely| because it keeps the employe on a g‘h-.ne of self respect and retains to the unqualified right to his nuities, I approve a generous contribu- tion from the employe toward the operation of the system. One phase of our system is excellent. It is provided that all the contribu- tions paid by the em; into the Tetirement fund shall refunded to the employes, or their heirs, with 4 per cent interest compounded. If the Seryice of an employe terminates be- fore he reaches retirement age, the full amount that he has paid into the fund, !'.I'.h com| he reaches retirement elect to take all he '~ | prophet come from last night in the National Radio Forum. SENATOR PORTER H. DALE Of Vermont, photographed before the microphone while delivering his address —Star Staff Photo. worth what it costs to the Government? | Let us as best-we can, use present con- it worth to the Government $20,000,000 for 28 rs to purchase a retirement system that will cost $4,000,000 a year to perpetuate? Of cqurse, as a matter of hard, ‘cold economy, that depends upon what the Government receives in return. It depends upon whether the Government can transact its business without Joss of efficiency that much cheaper because of a retirement system. Did time or discretion permit, one who observed could natrate the deplorable conditions ih the Government service, especially in the District of Columbia, 10 years and mgre ago. There needs no grave to tell.us the economic loss to the Government of carrying men and women on the pay roll until they expire from disability or_age. But the question of oegnm ‘has’ for long been the study of actuaries. There is an expert Government actusry in whom I have all confidence. He has | made public statements as to better con- ditions in the Government service be- cause of the retirement law. His state- ments have been approved by trained investigators. It 15 the coneurrent opinion of such experts that the im- ved conditions in Government serv- directly from the.retire- interest, in one adjustm . | oash saving of 5 per centum of the Government Guarantees Fund. ) As to those refunds, there is rio la- , veal or assumed, on the part of the Government save this:' The Cov- erpment guarantees the fund with in- :,n;xt at 4 per cent, which it can do o its age, aa if can it - ‘u"é"‘"..‘.‘. p:- he Ja pays. Under t of w all the employes whe da ot reach re- do <Shnd 31 what they Pate ‘Who become annuitants survive enough to vp what they paid in with interest—all those grouns do not cost the Govern- ment a dollar. It is natural to ask. For what is the Government lable? - There i an sumed liability on the part of the Gaov- ernment to pay annuitants the amount of their annuity beyond the amount With interest which the amuxumm inte the fund. Just that is the ity of the Government. That is, if l'-funtl.mmnumn amount to $2.400; if the lnmul:‘:;: cost to the Government would be the difference paid into the fund and the amount took out in annuity, which in that case would be $600. That is the nature ~* the lability which the Governmc ' assumes. ‘That Riability became a ch: ge on the Gov- ernment the day the initial retirement bill became effective, more than nine ago. As to the annuities that have paid to this date: First, the an- Duities paid to the large number of employes who were at once retired, nine years ago, for disability or age, and all of whom had paid nothing into the fund, have been wholly paid by the Government. All who have since then Tetired for disability or age have also been paid by the Government all that they have drawn over the amount that they had paid in during the part of the nine years before they were retired. ‘There were about 6,500 annuitants on ‘the list at the close of the first year. At the close of the eighth year since then, or June 30, 1929, of all who had gone on the list during the nine years about 16,500 were living. It is estimated that the list will inerease until the number carried perpetually will be .ap- proximately 30,000. When that contin- uing number has been reached, each of the mnnuitants will have paid into the fund through the years on which his eannuity is based, and the operation of the system will have become normal. Employes Pay Seven-Eighths. It is estimated that the normal op- eration of the existing law could be perpetuated by joint contributions from the employes of 313 per centum of their. salaries, and from the Government of an amount slightly less than i of 1 per centum of the total of the salaries of the employes. Those are the per- centages they are each paying at the present time. On the present salary Foll of $800,000,000, those contributions for the normal cost would amount to $28,000,000 for the employes and to 000,000 for the Government. That what they each paid iast year. That | 4s, of the normal cost of the operation of the retirement system, the employes pay seven-eighths and the Government Pays one-eighth. But the cost of putting the system into normal operation is the larger ex- penditure which the Government has assumed. And that expenditure it will sustain untll that cost is liquidated. That expenditure is for the annuities over and above what the employes pay in until the time of the normal opera- i Congress did not appropriate money | o pay that cost as it acerued during | the first eight years of the gperation of the Jaw. It is now estimated that to pay that accrued liability, and all that mccrue until it is all liquidated, will yequire an appropriation each year of to 2 per centum of Bte | gributions were to be made by the ment law represent conservatively a Gavernment pay roll. None will under- take to prove that estimate to be ex- presentatives has the reputation for making estimates of the cost of jects for which it appro- enough to save the vom- from just censure. An_able member of that committee stated two years ago that he thought it fair to assume that within the next 30 or 40 years the annuities and refunds may inerease to $40,000,000 & year. That is quite probable. but through the inter- vening years the pay roll will increase W the cl on the it «could be. t the pay roll were is and that no con- yes and . that the whole expense of ::,M.M per ,t‘" ‘were ufil ‘be borne by the Government perpetually—even so, it would not exceed the econemic saving of 5 per centum of the pay roll. 100 Per Cent Good Economy. Somebody has warned the country that the retirement system will cost ditions for concrete illustration. Is{ the Government in the next 30 years an te. of six hundred million dollars. t sounds alarming but taking the premises and facts on which that conclusion rests and applying to them the 8 per centum saving as esti~ mated, and it creates a resultant saving equal to the cost, so that the penditure of ‘six' hundrsd million to save six hundred million dollars is still a hundred per centum measure of good economy. ‘Two years ago the Bureau of Labor Statistics made an inquiry into the retirement syst:m. Beyond their intent, their findings are helpful in their appli- cation to the question of economy. ‘They report in detail upon 70 retire ment systems. In two of those the employes make all the contributions, 11 seven they make none and in others the contributions are joint. But in the application of each and all through the broad latitude of methods of contribu~ tion economy is & purpese and a resuit. In the light of general information and experience, scarcely any person will question that the most liberal retire- ment system is an economic benefit to the Governmer'. It is not assertion, but the statemcut of well known facts, to say that there is net a civilised nation in the world, not a big insurance company or railroad or employer of labor, that does not provide retirement for its employes as a matter of good, sound, practical economy. ‘The question of economy runs directly 4" that of “efficiency. It an émploye is up to the standard in efficiency, it is, of course, economy to keep him in the service, but the per cent that he falls below a standard that another could maintain is that much loss to the Gov- ernment. For example, if at present out of eight hundred million dollars paid in salaries the Government is pay- ing even twelve million dollars to employes who are only one-third under standard of efficiency, that loss to the Government is one-third of twelve mil- lion dollars, or four million dollars, and | that equals the whole amount of the Government’s share of the normal cost of the system. It is easily made evident that it Is most essential to efficiency that employes who are incapacitated be retired. Policy te Keep Employes in Service. On the other hand, it is good pub- lic policy, as well as efficiency, to keep employes in the service as long as they can keep up to standard. To keep the service up to standard is not humanly possible. It would at first seem that this might be approximated by giving some individua) ;{ocommls'lion w!.h:‘tl; ity to remove employes arbitrarily. experience hds demonstrated the ills of such a provision. To allow any offi- cial, or gre of officials, to select the | employe and fix the %me of his re-| tirement is contrary to the established theories of the American Government. | Great Britain experimented with that | method for a time, but has largely abandoned it. may retire at one-sf ment during the period of accrued lia- |bility. and seven times more than tae t after it reaches perpetual group fixed, 5 Failway postal clerks and others n group fixed to cover hazardous occupa- tion, may retire at the age of 62. Up o the present time employes who have reached retirement age as fixed by law may be continued in the service per- tually on two-year periods of e: - Slon"on Certfcaton, by 4, stated ofl- cial with approval of Ofvil Service expires on August thereafter no employe can be retained in the service more than four years, or two extensions, beyond his age of l‘eg}remetn“t..e That is, all are automati- cally retired at 74 years of age; pro- vided that the letter carriers up reach the automatic age at 69, and the railway postal group at 66, Lower Retirement Age Proposed. The bill that has passed the Senate and is now pending in the House, p poses to change the retirement ages hey apply to employes who have had 30 years of service. For such employes Out a Limited Number of : Attractive Mahogany Finished bt to 68, 63 and 60, respectively. ‘The chief argument in favor of this proposal is that there are many em- Flflyu who were broken in health be- lore reaching the minimum age as now flfi;flun}? thntmnte‘::; also m:tl;l e although incapacil , ‘are re- tained in the service by reason of the high maximum at. which they are sautomatically X are nat- had 30 or more years of hard service There is very little in lowering the age limits. The Civil Service Com- mission has stated that informal in- vestigation has shown that 95 per centum of the employes in the departments on arrival at retirement: age, desire to re- mein in the service. The commission also states that of those eligible for re- tirement more than 60 per centum have been retained in the service during the past three years. It is argued against keeping the age limit so high that more than 20 per centum of annuitants now on the list were retired for total dis- ability before reaching the age limit, and of the 70-year group, 30 per centum were retired for total disability before reaching that age. It would seem that almost any method is better than that which re- quires one to tell a person_ who hopes, and perhaps thinks, he is still efficient, that he is in fact broken and that his days of usefulness to his Government are gone forever. A date that works automatically, even though it forces a few out of the service a little earlier than they start to decline, if it saves that unkindest cut of all to many others, is so commendable that it calls for consideration, Increased Annvities Proposed. The bill now pend! in the House further proposes meths by which the annuities which now average $740 and shall not exceed $1,000, shall be in- creased to an average of $860, and shall not exceed $1,200. It is belleved that this small increase in annuities will greatly increase eficiency, and therefore be of value to the public. It is clearly evident that $100 a month is a small annunity on which to exist in these times; and when it is considered that scarcely a fourth of the annuitants ‘would that amount, it seems only reasonable to make every effort to raise the annuity to at least that scale. Under the provisions of the pending bill it is estimated that the Government s | contributions would have to be in- creased from their present amount of $20,000,000 per year to $23,500,000 dur- M;ho'any Finish Davenport Table ot in order, from which 34.49 D. the 28. years until the lability 4s m&:fll that after they instead of $4,000,000, be nearly $5000,000 a year to cover the normal cost. But even so, the Government would only be paying off its original liability as it accrued, and of the normal cost the employes would still bs paying six times ‘as much' as the Government, while .the service would be improved in efficiency in value far beyond: the total cost to both Government and. r reasons why the Government should have a well regu- lated retirement system the chief is the demand that the Government be humane. The employes who were be- fore the retirement law 25 to 100 4 cent inefficlent and yet were kept on the pay roll were so many that it is well not to discuss the number. While that condition was unfair to the public, it was primarily unjust to the broken- down employes. Ill health was almost wholly the cause of the ineficiency, and to ask a person-to even appear to per- form the duties of any- jon when in broken health, or in decline of C., FRIDAY, JANUARY Sogrent thers the ne 31, 1930. by the Covernment, will be. by well earned right when age comes on. Dread, fear, may be, as some tell us it is, & state of mind, but of whatever substance it is, praise God for the hand that puts it back when it shadows us in our i and in our age. The hand that holds back dread our | Government gives all who are in the service the privilege to buy. The money paid in from year to year retains that power and keeps it a protection in time of need, And now to all cf you 400,000 of the service whose co-operation has ever brww cheer in our work to bet- tek cf dons in the service and for the public I would say: Let us take heart and go on. From this snow-bound East to the Summerland of the West, where | you gave me recent cordial welcome, | age, is to impose inexcusable hardship. | | Any man or woman who has come down through long years of service to the Government has a well earned right to consideration. To eoncede that right is not charity, but justice. ’ Asks Consideration fer Child, Henry W. Longfellow asked consid- eration for the child because of the right divine of helplecsness, No less divine is the right where it exists with age. ‘That government which works to pain or stints to want its employes has still within it an element which is barbaric. ‘The Government should at least give consideration to its faithful employe came to that last scene of allin Shake~ speare's seven ages, There is a man of the service, and he has given generously of his time and thought to help his associates. One night in my office we chanced to speak of the inscriptions that some distin- guished men had wanted on their gravestones. “Well,” he said, “if I would choose mine, it would be: He helped take away the dread of old age from 400,000 of his friends.” ‘The dread of age was terrible to men and women in the service who realized | that they had gone by and must be forever dependent upon the mercy of some bureau chief and the direct chari ty of the taxpayers. 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