Evening Star Newspaper, September 27, 1936, Page 14

By the Associatea Press. MILWAUKEE, September 26.—The text of Gov. Alf M. Landon’s address n the Milwaukee Auditorium tonight Sollows: I am going o talk tonight about economic security—economic se- curity for the men and women obliged to earn their daily bread through their own daily labor. There is no question that it is of deep concern to us all. Even in good times there is ever present in the minds of workers the fear of unemployment. In periods of deep depression, there is the fear of protracted idleness. And al- ‘ways, in prosperity and in depres- sion, there is the ever present dread of & penniless old age. From the standpoint of the in- dividual, I know of no more in- tensely human problem than that of economic security. From the standpoint of the Government there is no problem calling more for a sympathetic understanding and the best efforts of heart and mind. But to solve the problem we must have more than a warm heart and a generous impulse. We must have the capacity and the determination to translate our feel- ings into a practical, workable pro- gram. Day-dreams do not pay pensions. Now in broad terms there are $wo ways to approach the develop=- ment of a program of economic se- curity. One is to assume that hu- man beings are improvident—that it is necessary to have the stern management of a paternal gove ernment to force them to provide for themselves—that it is proper for the Government to force them to save for their old age. The other approach is to recognize that in an industrial nation some peo- ple are unable to provide for their old age—that it is & responsibility of saciety to take care of them. The act passed by the present administration is based upon the first of these approaches. It as- sumes that Americans are irre- sponsible. It assumes that old- Age Pensions are necessary because Americans lack the foresight to provide for their old age. I re- fuse to accept any such judgment of my fellow citizens. Old-Age Pensions Matter of Judgment. I believe that as & nation, we ean afford old-age pensions—that in a highly industrialized country they are necessary. I believe in them as a matter of social justice. Because of my firm belief in the $ustice, necessity and feasibility of . old-age pensions, I am going to discuss the present act with the utmost frankness. It is a glaring example of the bungling and waste that have characterized this ad- ministration’s attempts to fulfill _ its benevolent purposes. It en- dangers the whole cause of social security in this country. In my own judgment—and I have examined 1t most carefully—this law is un- Just, unworkable, stupidly drafted and wastefully financed. Broadly speaking, the act is di- vided into three main sections. One deals with compulsory old age in- surance. It applies to about one~ half of our working population. It excludes, among others, farmers and farm laborers, and domestic servants, Another part of the act attempts o force States to adopt unemploy- ment insurance systems. The third part of the act pro- vides old age pensions for those in need who do not come under the compulsory plan. Now let us look at the so-called old age insurance plan in more de- tail, and on a dollars and cents basis. In other words, let us see Just how much the old people of this country are going to get when they are going to get it, and who is going to pay for it. Here we are dealing—not with opinions—but with hard facts, with the provisions of the law. Under the compulsory insurance plan of the present law, none of our old people will get any pension at all until 1942. If you happen to be one of those insured—and, remem- Called Cruel Hoax. Landon High Lights By the Associated Press. MILWAUKEE, September 26. High lights of Gov. Alf M. Landon's address here tonight on “Social Se- curity”: “e & ¢ To solve the problem (of economic security) we must have more than a warm heart and a generous impulse. We must have the capacity and the determination to translate our feelings into a practical, workable program. Day dreams do not pay pensions.” “The Republican platform proposes to encourage adoption by the States of honest and practical measures for meeting the problems of insurance against unemployment.” “I believe that as a Nation we can afford old-age pensions—that in a highly industrialized country they are necessary. I believe in them as a mat- ter of social justice.” “The present act * * * is a glar- ing example of the bungling and waste that have characterized this adminis- tration's attempts to fulfill its be- nevolent purposes. It endangers the whole cause of social security in this country. In my own judgment * * * this law is unjust, unworkable, stu- pidly drafted and wastefully financed.” “The Republican party rejects any feature or any plan that hinders re- employment.” “What happens when the Treasury buys Government bonds? Well, at present, when there is a deficit, the Treasury gives the Treasury some nice new bonds in exchange for the cash which the Treasury gives the Treasury. Now what happens to the cash that the Treasury gives the Treasury? The answer is painfully simple. We have good spenders at Washington, and they spend the cash * * * “If the present compulsory insur- ance plan remains in force, our old people are only too apt to find the cupboard bare.” “I want the Treasury to be in a position where it must consider every penny it spends. I want the Secre- tary of the Treasury to be obliged to say to committees of Congress every time a new appropriation is proposed, ‘Gentlemen, you will have to provide some new taxes if you do this’ " “®'s * For the Federal Govern- ment to step in and to use its taxing power to compel all of the States im- mediately to enact unemployment in- surance statutes is something unheard of. It is most unwise.” “To get a workable old-age pension plan we must repeal the present cotn- pulsory insurance plan. The Repub- lican party is pledged to do this.” “We propose through amendments to this section (of the present act, dealing with pensions for the needy aged, not covered by the compulsory insurance plan) to provide for every American citizen over 65 the supple- mentary payment necessary to give a minimum income sufficient to protect him or her from want.” “To these—our old people, our work- ers struggling for better conditions, our infirm—I will not promise the moon. I promise only what I know can be performed: Economy, a living pension and such security as can be provided by a generous people.” more and get less than workers who come under the State laws already in force. For instance, under the new law, many work- ers now 50 years old must pay burdensome taxes for the next 15 years in order to receive a pension when they are 65; whereas those of the same age who come under THE SUNDAY STAR, WASHINGTON, D. .C., SEPTEMBER 27, 1936—PART ONE. Landon Address at Milwaukee Forced Saving Under Social Security Law some State laws pay no taxes and yet actually get a larger pension when they reach the age of 65. These are & few reasons why I called this law unjust and stupidly drafted! There is & further important point in connection with the com- pulsory saving provided by the plan of the present adminjstra- tion. According to this plan, our workers are forced to save for a lifetime—what happens to their savings? The administration’s theory is that they go into a re- serve fund—that they will be in- vested at interest and that in due time this interest will help pay the pensions, The people who drew this law understand nothing of Government finance. Let us trace the process step by step. The workers’ cash comes into the Treasury. What is done with it? The law requires the oTreasury to buy Government bonds. What happens when the ‘Treasury buys Government bonds; well, at present, when there is a deficit, the Treasury gives some nice new bonds in exchange for the cash which the Treasury gives the Treasury. Now what happens to the cash that the Treasury gives the Treasury? The answer is painfully simple. We have good spenders at Washington, and they spend the cash that the Treasury gives the Treasury. Now, I know all this sounds silly, but it happens to be an curate recital of what this ad- ministration has been foolish enough to enact into law. Let me explain it in another way—in the simple terms of the family budget. The father of the family is a kindly man, so kindly that he borrows all he can to add to the family's pleasure. At the same time he impresses upon his sons and daughters the necessity of saving for their old age. Every month they bring 6 per cent of their wages to him so that he may act as trustee and invest their savings for their old age. The father decides that the best invest- ment is his own 1. O, U. So every month he puts aside in a box his 1. O. U. carefully executed, and, moreover, bearing interest at 3 per cent. And every month he spends the money that his chil- dren bring him, partly in meet- ing his regular expenses, and the rest in various experiments that fascinate him. Years pass—the children grow old—the day comes when they have to open their father's box. What do they find? Roll after roll of neatly executed “L 0. U.s.” Forced Saving Called Cruel Hoax on People. I am not exaggerating the folly of this legislation. The saving it forces on our workers is a cruel hoax. There is every probability that the cash they pay in will be used for current deficits and new ex- travagances. We are going to have trouble enough to carry out an economy program without have ing the Treasury flush with money drawn from the workers. Per« sonally, I do not want the Treas- ury flush with trust funds—funds which the trustee can mingle with its own general funds. I want the ‘Treasury to be in a position where it must consider every penny it spends. I want the Secretary of the Treasury to be obliged to say to committees of Congress every time a new appropriation is pro- posed, “Gentlemen, you will have to provide some new taxes if you do this.” With this social security money alone running into billions of dollars, all restraint on Congress will be off. Maybe some people want that, but I don’t. And even if the budget is bal- anced, the fact that there is a billion dollars and more of extra cash on hand each year that can " be made Instantly avallable for any’ purpase by lssuing special bonds to - the trust fund is too great s temptation. ‘This temptation is further in- creased by another provision of the law—that provision relating to how much of the cash collected will be paid out in pensions. During the next 10 years only 10 cents out of every dollar collected from the ‘workers will be paid out as bene- fits. And from now until 1950 only 16 cents out of every dollar cole lected will be paid out as benefits. ‘The workers asked for a pension and all they have received is just another tax. There is one more point that I want to mention about the com- pulsory old-age pension syrtem. This is the question of keeping records. The administration is pre« paring a plan, the exact nature ot which we shall not know until after the election, for keeping the life records of 26,000,000 of our working people. These records are necessary because the amount of the pension any one is to receive depends upon how much he has earned after the act goes into effect. ‘The record must show every job s man has and every dollar he earns so long as he is working at something that brings him under the plan. If he is working in a factory and changes to another factory a Government agent must keep track of him. Imagine the vast army of clerks which will be necessary to keep these records. Another army of field investigators will be neces- sary to check up on the people whose records are not clear, or regarding whom current informa- tion is not coming in. And so bureaucracy will grow and grow and Federal snooping flourish. Compulsory Insurance In Way of Pension. ‘To get & workable old-age pension plan we must repeal the present compulsory insurance plan. The Republican party is pledged to do this. The Republican party will have nothing to do with any plan that involves prying into the per- sonal working records of 26,000,000 people. Before discussing the positive part of our program, however, I want to take up the second main feature of the present act, the part dealing with unemployment in- surance. The problem of unemployment insurance differs fundamentally from that of old-age pensions, Old= Riefll! 2333 Se Joffe St. Dear Sirs? 1 am so well you that I am ¥ chased from 80 I much satisfie 1 4id not have that 1 found t me of the resu o 1934 1 purchased abou! 1 drove that car 36,000 miles in and wish to sa¥y mance 4 with its economy and perfor ’ any motoT work_done in that time. 1 traded nere were added i age pensions were reasonably well established in & number of States, even prior to the passage of the social security act. Federal grants to States to supplement State old- age pensions do net differ from the practice followed for years— the practice of making grants to States to supplement and encour- ’n:; projects for the general wel- Unemployment insurance is something new and of a different charadter. We have never had un- employment insurance in this country. With the exception of two States, and their laws are of recent origin, there were no un- employment .insurance laws on the statute books of our States before the. social -security law. Under these circumstances, for the Federal Government to step in and to use its taxing power to compel ‘all of the Btates immedi- ately to enact unemployment insur- ance statutes is something unhear: of. It is most unwise. There is no element of real help to the States in the present statute. There is merly compulsion. It completely ignores what has been of price- less value to us—the use of the States as experimental workshops in which new methods and policies may be tried out and gradually pere fected. Practieal Methods of Republicans. The Republican platform pro- poses to encourage adoption by the States of honest and practical measures for meeting the problems of insurance against unemploy- ment. It does so because we rec- ognize that we live on a conti- nent with a wide range of working conditions and standards of living. It does so because we have still nearly everything to learn in this field. With State experiments, differ- ent States trying out different plans and watching the results, we shall work out a much better system than could possibly be imposed at this time from Wash- ington. The impatient advocates of almost every social reform are disposed to seek the shortcut of Federal action rather than to wait for the slower, but more certain, progress achieved under State auspices. If a State makes a mis« take the effect is local and limited. With State action we avoid mis- takes involving the whole country. As Woodrow Wilson said of State action, it “has given speed, facility, ng Automobns‘ Company rson Avee. Louts, Wissouris 1ts I have obtal the 1934 Ford C pleased with th aking the time t ned from Ford ¢ vigor and certainty to the progress of our economic and political growth.” It is urged ' that competition among industrial States will pre- vent State action in this field. But forward-looking States like your own have been disproving this for 25 years. This brings us to the third main feature of the present act—the sec- tion dealing with pensions for the needy aged not covered by the compulsory insurance plan. This part of the present law can be made to serve as the foundation of & real old-age pension plan. This, the Republican party proposes to do. It proposes to overhaul this section and make of it a workable, common-sense plan—a plan to be administered by the States. ‘We propose through amend- ments to this section to provide for every American citizen over 65 “the supplementary payment necessary to give a minimum in- come sufficient to protect him or her from want. Haste and Lack Of Knowledge. Frankly, 1 am not in a position to state with finality the total cost of this plan. One of the most serlous criticisms to be made of the present social security act is the haste with which it was cone structed, and the inadequate knowl- edge on which it rests. I do not intend to repeat this error. I have been studying this problem closely for the past year and a half, and I have had the benefit of the opin- jons of many close students of these problems. Elaborate compu- tations of the probable costs have been prepared for me. And while | Cantfleve% | a Ford Coupe from t fifteen months. oupe for 2 1935 F as 8 nprcvemnts on the 1935 and it w 1 drove the 193! share of complete FOOT COMFORT in the famous STACH'S Foot Health Headquarters 523 11th ls"m N.wW. June 22, 1938 o 1936 Ford Coups I pur= o tell you of arsSe your Companye ord Coupee 5 _coupe better I am not willing to accept these computations as final, it is clear from them that the plan which we propose will be much less expensive than the plan of the present Ad- ministration—because we will not create a needless reserve fund of 47 billion dollars. Our plan will be on & pay-as- you-go basis, with the result that we will know year by year just what our pensions are costing us. That 1is sound, common-sense financing. ‘There is one other point I want to impress upon you. This is the - question of raising the money to pay the pensions. The precise method of taxation used will de- pend upon the decision of Congress working in co-operation with the Treasury. But there are three es- sential principles which should be complied with: the necessary funds should be raised by means of a special tax earmarked for this pur- pose, so that the already difficult problem of budget-balancing may not be further complicated. The tax should be direct and visible. And the tax should be widely dis- tributed. Only if every member of the great body of our citizens is conscious of his share of the cost can we hope to resist the constant pressure to increase pensions to the point where the burden will be waren near $289 Any nationall fay 2t Tl :”uurtllel product at o 'ayments start Oct. 1. without additional interest. S-year guarantee. unbearable; only if every one bears his just share can we hope to pre- vent the plan being used for polite ical purposes. If we will prevent such exploitae tion and if we will put the plan on 8 sound financial basis, we can afford to be liberal to our old people. If the present compule sory insurance plan remains in force, our old people are only too apt to find the cupboard barz. Let me repeat! I am a pro- found believer in the justice and necessity of old-age pensions. My criticisms of the present act is not that its purpose is bad. It is that this act will involve a cruel disap- pointment for those of our people least able to bear the shock of disappointment. ‘To these—our old people, our workers struggling for better con- ditions, our infirm—I will not promise the moon. I promise only what I know can be performed— economy, a living pension, and such security as can be provided by a generous people, Red Crepe Myrtle Little Blue Spruce MARYLAND NURSERY, EDMONSTON, MD. (East Hyattsville) $500 CAMEL OIL BURNER BOILER UNIT *395 Complete, Installed NO MONEY DOWN Sce this MASTER BURNER. a o Pepco show roo: All Work Supervised by Joseph Ribes ECONOMY HEATING COMPANY 906 10th St. N.W. 1 was very Met. 2132 ber, about half of our workers are I not—you have to earn, on the aver~ age, $135 a month every single . month for the next 20 years to get ® monthly pension of $37.50, and {:I.l ::x'::g earn $125 a month for years to get a i bf $59.38 a month :esidufmthueon pums have to support both the Mvorker and his wife. Payment of Taxes By 26,000,000 Workers. But meanwhile, beginning on ®anuary 1st of next year, 26,000- 000 working people begin paying taxes o provide these pensions. Beginning next January employers must start deducting these taxes from the pay envelopes of their employes and turn them over to the Government. Beginning next January employers must, in addi- tion, begin paying taxes on the payrolls out of which your wages are to come. This is the largest tax-bill in history. And to call it *“social security” is a fraud on the working man. These taxes start at the rate of 82 in taxes for every $100 of wages. ‘They increase until it is $6 in taxes Yours very trulYs for every $100 in wages. We are told that this $6 will be equally /fi""‘ divided between the employer and t the employe. But this is not so, s - - G 3232 Minnesots or e ’ % case, that the whole tax will be borne either by the employe or by s c H l C K 34 guch better ¢ar than the 1934. cept small incidentalse no_repairs, eX S then 44,000 uREIEE h the 1934 and 1935 Ford Coupes tha : 1t ery vas so vell m——— So far the '36 18 far superior in oV 0 36 () 1 decided to buy a 19 e that T purchased from ¥ he. 0 ither of t . d“a;zl ': .11 mileage averages 19.2 miles to the g A 3ok vast improve= ! 1ize that there were such : 1 could not red g g t 1 suppose Ford cars, bu ¥ o there vill be something petter £ mekes of automobiles and have ] on and reliability out of any pepts in the vari o to improve, and jven various satistactd he Ford carse continu 1937 never of them that I have 1 have dr gotten the economy, out of t & the consumer through higher prices. employer is to stay in business, he the tax to someone else. Do not forget this: Such an ex- tax on pay rolls is beyond Question a tax on employment. In prosperous times it slows down the advance of wages and holds back re-employment. In bad times it employment breaks wage scales. ‘The Republican party rejects any feature of any plan that hinders re-employment. Yet it is solely by such a tax E TRY. to advertise the Ford V-8 fairly and honestly, without disparaging any, other man- “THE UNIVERSAL CAR” ufacturer’s product. People seem to appreciate that. TRY IT 30 DAYS.- FREE _ Butall our advertising would be wasted if the car itself didn’t deliver the performance, comfort, safety $25 A MONTH, ofter usual down-payment, buys any 1936 Ford V-8 car —from any Ford dealer—anywhere in the U. S. Ask your Ford dealer about new Universal Credit Company Y:% per month Finance Plans. and economy we claimi for it. A lot of letters like the one above indicate that it does.