It was a bright idea really. I don't know why they don't do it more in the Government now. "Borrow people; just borrow what you need for staff. Why, there are all kinds of people working in Washington-thousands of them. Borrow them. The Army's got them; the Navy's got them; Agriculture's got them; Labor's got them; everybody's got thousands of people working for them. They don't really need all of them," he said.
So we borrowed them. Mostly it was Agriculture and Labor who contributed to the staff, and the Attorney General gave us half a dozen lawyers whom he didn't know what to do with otherwise. They were good people, it so happened, and I had the pick of them.
Then we took $125,000 from Harry Hopkins, but on a promise. We promised that we would employ only the unemployed with that $125,000. But that was all right, because plenty of statisticians, plenty of college professors, plenty of people who knew how to dig for facts and so forth — who were unemployed. There were stenographers, of course, and clerks by the dozens who were unemployed. That was a very good scheme. We used only persons otherwise unemployed and the thing got off to a good start.
(Ed. Note: Edwin J. Witte, the Executive Director of the committee on Economic Security, reported in his book, The Development of the Social Security. Act, that the sum of $87,500 was initially set aside from F.E.R.A. (Federal Emergency Relief Administration) funds for the Committee. Because of congressional delays in enacting the Social Security Act this allocation was insufficient and the balance of the expenses of the Committee were carried as administrative expenses of the F.E.R.A. The total expenses of the Committee (including the $87,500 originally allotted) totaled $145,000.)
Well, we had a great many difficulties. If you have administered a new program you know some of the problems we went through getting this one organized.
We knew we had to have actuaries. Well, the Lions Club of America and some other big service organizations put up the money for actuaries. Think of that! It was a really a wonderful thing that they did, because none of us had clear ideas about actuaries. But they had a small insurance system in their own scheme of things and they knew actuaries. So they gave us their actuaries; and the Equitable Life Assurance Society also gave us two actuaries. That was a little political pull inside the Equitable Assurance Co., I must admit; but still we got two first-class actuaries from them. In addition, we got a lot of able and willing people just as "gifts."
COMMITTEE GOES TO WORK
Of course, we had to have a driver. That was why we got Ed Witte from the University of Wisconsin. We borrowed him, first for 3 months, and then for the duration of the problem. He was a tower of strength because he knew how to direct and how to get work out of people who were scattered about in the organization. We didn't have much time because we set ourselves January 1, 1935 as the date to report our plan. We borrowed university people who, beginning in July, were on summer vacation — quantities of them. I didn't know as much about university people then as I do now, but university people — teachers and professors — are a problem in themselves. They have great pride of opinion, and they are quite vocal. They can give voice to their opinions wonderfully, and they can write reports very readily. It takes comparatively little time to write a report, but it is a different thing to do what the report recommends.
We soon found that we had a team of very high-strung people on our hands and somebody had to direct them, but Witte was just perfect. He was a university man himself. He was accustomed to dealing with irate and excited scholars who didn't want to be disputed about things they knew, or thought they knew; and he was a very practical man, too. He'd been in the legislative bill-drafting department at the State of Wisconsin, and he knew how to set up a law; that is, what you had to have in it. He knew what the situation required and (with his superior knowledge) he could calm down those scholars better than any of the rest of us could.
At any rate, we worked all summer. We had the Technical Board on Economic Security made up of Government officials. We had an Advisory Council on Economic Security which was the employers, organized labor, and the general public. They were easier to handle because the "general public" had been picked; you know, the way you pick a committee. They were all perfectly good people. Even the employers had been well picked. There was Marion Folsom of Eastman Kodak Co. Some of us happened to know him to be a good man with a kind of social mind; and you know what became of him. He worked for that committee and later he turned up as head of the whole Department of Health, Education, and Welfare. A very good person--a man of great ability who really dedicated himself to the promotion of these ideas. It was a terribly hot summer and everybody worked hard all the time and finally we actually did bring forth a report on the first of January 1935. it was a report that recommended unemployment insurance and old-age insurance but omitted health insurance just because the experts couldn't get through with health insurance in time to make a report on it.
And it was true, they couldn't. Intellectual difficulties had arrived. of course, the actuarial problem was especially difficult. The actuaries had to know almost before we met. They had to know what we wanted them to figure it on. It had not occurred to us until then that the actuaries had to have something to go on. They are accustomed to measuring the hazard and the exposure and the victims who are involved in the insurance contract. But first they have to know what is the exposure; that is, how many people are going to be in this pattern. And then how many people do you expect to be victims? To how many people will we have to give compensation? "We can't make the actuarial tables without that. We have to know how many. The population of the United States is 130 million. How many of them will be involved in this?"
That was one of the funny things, you know. While the estimate of the number of people covered by the program--on an average basis — was substantially correct, we so desperately underestimated the number of people that would have covered earnings at some time during the year. The actuaries had to have one set of figures for the old-age system and another set of figures for unemployment. We greatly underestimated the number of persons in both categories because there simply were no statistics on turnover of employment. We didn't know; we couldn't know these matters, but we finally rigged up a preconceived state of affairs. And assumed that any law would have to give a four weeks' waiting period, and we assumed a certain number of persons covered, and we assumed a payment of $15 a week as the minimum, but not to exceed, I think it was one-quarter, of the weekly wages of the unemployed person; and something about like that for the aged persons--also one-quarter of the weekly wages of the previous earnings — the latest earnings of the aged. This is what we gave the actuaries to figure on, and they did a very good job, I may say.
The legal committee soon broke into a row because the legal problems were so terrible. The constitutional problem was the greatest one. How could you get around this business of the State-Federal relationships? It seemed that couldn't be done.
We continued to wrangle about it' for days. But one day I went out to tea, although not because I wanted to. In Washington you don't go to parties just because you want to go, you know; you go because you have to go. I had to call upon Mrs. Harlan F. Stone, the wife of the Supreme Court Justice. She was at home on Wednesday afternoons and so about 5:45, which is nearly the end of the day, I went to her house and presented myself. There were a lot of other people there. We went up to the dining room to get a cup of tea, and there I met Mr. Justice Stone who had just come home from the Court and was getting his cup of tea. We greeted each other and sat down and had a little chat.
He said, "How are you getting on?" I said, "All right." And then I said, "Well, you know, we are having big troubles, Mr. Justice, because we don't know in this draft of the Economic Security Act, which we are working on — we are not quite sure, you know, what will be a wise method of establishing this law. It is a very difficult constitutional problem, you know. We are guided by this, that, and the other case." He looked around to see if anyone was listening. Then he put his hand up like this, confidentially, and he said, "The taxing power, my dear, the taxing power. You can do anything under the taxing power."
I didn't question him any further. I went back to my committee and I never told them how I got my great information. As far as they knew, I went out into the wilderness and had a vision.
But, at any rate, I came back and said I was firmly for the taxing power. We weren't going to rig up any curious constitutional relationships. "The taxing power of the United States — you can do anything under it, " said I. And so it proved, did it not?
Of course, some of you don't remember the anxiety with which some of us watched the first case go before the Supreme Court; but it came down absolutely all right. The opinion was written in elaborate, fine social language by Mr. Justice Benjamin Cardozo — not by Mr. Justice Stone — but he voted "Aye" on the matter and we were safe. This is the reason, of course, that we built so strongly on the taxing power and that the whole system of taxation is the basis of the Social Security Act. We tax the aged when they are young; that is, we tax all the young people for the social security system while they are at work; and then when they retire, they are eligible.
Well, of course, this whole thing led us into the problem of what to do with the "half-aged" — what to do with those who are already 55 and had never contributed. We rigged that up on a compromise basis with all sorts of trading within the committee, but the report finally went in and it was a good-enough report. It was not perfect by any means. There had been trading within the committee; there had been secret work by certain members of the committee who didn't want to show their hands; and there had been a great fight in the President's Economic Security Committee. It had been really a tough fight as to whether we should have a Federal-State system (of unemployment compensation) or pure Federal system, and I cannot tell you how many times I changed my mind, nor can I tell you how many times the other members changed their minds.
BEATING THE DEADLINE
We voted once to have it a pure Federal system. By the time the others had been out of my office a couple of hours, I began to get telephone calls from them individually saying they thought we ought to meet again--that there was something to be said against that and they would like to review their vote; and could we meet next week? So we would meet and we would vote the other way the next week — we'd vote to have it a Federal-State system. Then we would have the same experience; people would telephone and want to review it again, and we would meet again. This went on for weeks. We came, really, up to the date when the report had to go in within a week. I then took the strong measure of asking them to come to my house--not for dinner but after dinner — nd then I told them I was going to lock the door and we would stay until we had settled it and there would be no more review. This was the final and the last meeting — "We have to settle it tonight."
Well, we locked the door and we had a lot of talk. I laid out a couple of bottles of something or other to cheer their lagging spirits. Anyhow, we stayed in session until about 2 a.m. We then voted finally, having taken our solemn oath that this was the end; we were never going to review it again.
We voted to make unemployment insurance a State-Federal system. N there were reasons for that which were entirely practical. We knew, of course, that a Federal system would have been much simpler to operate, but the opposition in Congress to unemployment insurance was very large, while the opposition to old-age insurance was very small. The opposition in the Congress to unemployment insurance too the form of being in favor of merit rating, which is a pestiferous thing. It gives the insurer the opportunity to have his taxes reduced if he doesn't produce much of the hazard, but that throws your whole system into disorder. If the bill had come up on the floor of the Senate or of the House as a Federal system, they would surely have put in amendments here, amendments there, and amendments to the unemployment insurance galore, until they would have gotten a good name but the bill would not have passed. This I was sure of. I'd seen it happen in New York State; I'd seen it happen in other places; and the President agreed with me it was the thing they would most certainly do. They would pass old-age insurance but they would not pass the unemployment insurance part. So, we put it all in one bill and then acted as though we were rigged; we wouldn't compromise with people but insisted that it all go through in one deal: unemployment insurance and old-age insurance. This was the reason it was done — because of our belief that the Congress would have monkeyed with the unemployment insurance sections so much that we would have lost the bill entirely. It could not have been passed. But with the States coming in to run the unemployment insurance you always had the theory that the States could experiment in this line without ruining the whole system. And so, we now have the matter firmly fixed, but not so firmly that it can't be modified at some future time.
This, then, was the genesis of the whole bill. We did a great deal of educating by one kind of propaganda or other, chiefly hearings. Senator Wagner put it up — a bill which he called a model bill — and held public hearings in the Senate, which attracted a great deal of attention from the Senators. We had a number of senatorial committees which we asked to look into this or that. We got advice. All these actions were for the purpose, not so much of advice as of propaganda — that is, of education of the public. I don't remember how many speeches we made. I made over 100 speeches myself in that period, and practically everybody else who had anything to do with the scheme made many, many speeches. The result was a bill that finally was presented to Congress and, as you know, was debated very briefly, really quite briefly when you think of the problems that were involved — only a decent amount of debate — and we gave way on all kinds of things. We gave way on washing out universal insurance; that is, universal coverage. We let them take out one group after another; no objections, just so we got the basis of the bill. And finally, we did get the basic bill passed. It came through after amendments, and so forth, and was passed in August 1935 by an extraordinary vote. There were only nine votes against it in the Senate. One could hardly have believed that was possible. I forget the House vote, but it was perhaps 90 votes against or something of that sort.
(Ed. Note: The vote was 371 to 33 in the House and 77 to 6 in the Senate.)
Yes, an overwhelming vote for Social Security, and so it was established. But of course you knew the two committee chairmen. Senator "Pat" Harrison of Mississippi was a wonderful orator. He didn't know the first thing about this bill. Congressman Bob Doughton of North Carolina knew even less about it because he was deaf and couldn't hear what was said to him about it. But there wasn't much debate in the House anyway. Senator Harrison had to present the bill. This was the occasion, of course, on which Mr. Thomas Eliot, now the chancellor of Washington University in St. Louis, undertook to sit on the steps of the Senate beside Pat Harrison and pass up to him the answers to the questions that were asked him.
I understand Mr. Eliot says he never was a page and didn't wear short pants. I never said he wore short pants. I just said he sat on the steps of the Senate and gave the answers to Pat Harrison; but I suppose Mr. Eliot is sensitive for fear somebody might think that he masqueraded as a Senate page. However, in retrospect, these things were funny, but they were all part of what we did in the effort to put this thing through. Tom Eliot was then a youngster in the legal department, and he was doing the things that help most that he could do.
It finally went through in a blaze of glory. Harrison was congratulated and Doughton was congratulated, and they all beamed; and I gave a party. To my astonishment, Mr. Doughton accepted the invitation and came. His wife said "You know, we've been in Washington for 35 years and we never went out before where we stayed later than 8 o'clock at night, but this is a great occasion and Bob wants to come." So they came and stayed until half past 8! The Harrisons stayed a little longer. It was a perfectly simple party, but it was one of great rejoicing, which we all felt was justified.
And then began the great problem which you have taken over — the administration of this act. Thousands of new problems arose in the administration which had not been foreseen by those who did the planning and the legal drafting. Of course, the Act had to be amended, and has been amended, and amended, and amended, and amended, until it has now grown into a large and important project, for which, by the way, I think the people of the United States are deeply thankful. One thing I know: Social Security is so firmly embedded in the American psychology today that no politician, no political party, no political group could possibly destroy this Act and still maintain our democratic system. It is safe. It is safe forever, and for the everlasting benefit of the people of the United States.
(Slightly edited and revised from spoken remarks)
More Articles
- National Archives Foundation: Archives Experience, A Republic, If You Can Keep It
- Selective Exposure and Partisan Echo Chambers in Television News Consumption: Innovative Use of Data Yields Unprecedented Insights
- Congressional Budget Office: Federal Budget Deficit Totals $1.4 Trillion in 2023; Annual Deficits Average $2.0 Trillion Over the 2024–2033 Period
- Jo Freeman Reviews Thank You For Your Servitude: Donald Trump's Washington and the Price of Submission
- Journalist's Resource: Religious Exemptions and Required Vaccines; Examining the Research
- Jo Freeman Reviews: Lady Bird Johnson: Hiding in Plain Sight
- Jo Freeman Writes: Sex and the Democratic Party – In Brooklyn
- Jo Freeman Reviews MADAM SPEAKER, Nancy Pelosi and the Lessons Of Power: “An iron fist in a Gucci glove”
- Jo Freeman Reviews Mazie's Hirono's Heart of Fire: An Immigrant Daughter's Story
- Jo Freeman: The Georgia Peach Is Purple