MESSAGE TO CONGRESS REVIEWING THE BROAD OBJECTIVES AND
ACCOMPLISHMENTS OF THE ADMINISTRATION. JUNE 8, 1934.
You are completing a work begun in March
1933, which will be regarded for a long time as a splendid
justification of the vitality of representative government.
I greet you and express once more my appreciation of the
cooperation which has proved so effective. Only a small
number of the items of our program remain to be enacted
and I am confident that you will pass on them before adjournment.
Many other pending measures are sound in conception, but
must, for lack of time or of adequate information, be
deferred to the session of the next Congress. In the meantime,
we can well seek to adjust many of these measures into
certain larger plans of governmental policy for the future
of the Nation.
You and I, as the responsible directors
of these policies and actions, may, with good reason,
look to the future with confidence, just as we may look
to the past fifteen months with reasonable satisfaction.
On the side of relief we have extended material
aid to millions of our fellow citizens.
On the side of recovery we have helped to
lift agriculture and industry from a condition of utter
But, in addition to these immediate tasks
of relief and of recovery we have properly, necessarily
and with overwhelming approval determined to safeguard
these tasks by rebuilding many of the structures of our
economic life and reorganizing it in order to prevent
a recurrence of collapse.
It is childish to speak of recovery first
and reconstruction afterward. In the very nature of the
processes of recovery we must avoid the destructive influences
of the past. We have shown the world that democracy has
within it the elements necessary to its own salvation.
Less hopeful countries where the ways of
democracy are very new may revert to the autocracy of
yesterday. The American people can be trusted to decide
wisely upon the measures taken by the Government to eliminate
the abuses of the past and to proceed in the direction
of the greater good for the greater number.
Our task of reconstruction does not require
the creation of new and strange values. It is rather the
finding of the way once more to known, but to some degree
forgotten, ideals and values. If the means and details
are in some instances new, the objectives are as permanent
as human nature.
Among our objectives I place the security
of the men, women and children of the Nation first.
This security for the individual and for
the family concerns itself primarily with three factors.
People want decent homes to live in; they want to locate
them where they can engage in productive work; and they
want some safeguard against misfortunes which cannot be
wholly eliminated in this man-made world of ours.
In a simple and primitive civilization homes
were to be had for the building. The bounties of nature
in a new land provided crude but adequate food and shelter.
When land failed, our ancestors moved on to better land.
It was always possible to push back the frontier, but
the frontier has now disappeared. Our task involves the
making of a better living out of the lands that we have.
So, also, security was attained in the earlier
days through the interdependence of members of families
upon each other and of the families within a small community
upon each other. The complexities of great communities
and of organized industry make less real these simple
means of security. Therefore, we are compelled to employ
the active interest of the Nation as a whole through government
in order to encourage a greater security for each individual
who composes it.
With the full cooperation of the Congress
we have already made a serious attack upon the problem
of housing in our great cities. Millions of dollars have
been appropriated for housing projects by Federal and
local authorities, often with the generous assistance
of private owners. The task thus begun must be pursued
for many years to come. There is ample private money for
sound housing projects; and the Congress, in a measure
now before you, can stimulate the lending of money for
the modernization of existing homes and the building of
new homes. In pursuing this policy we are working toward
the ultimate objective of making it possible for American
families to live as Americans should.
In regard to the second factor, economic
circumstances and the forces of nature themselves dictate
the need of constant thought as the means by which a wise
Government may help the necessary readjustment of the
population. We cannot fail to act when hundreds of thousands
of families live where there is no reasonable prospect
of a living in the years to come. This is especially a
national problem. Unlike most of the leading Nations of
the world, we have so far failed to create a national
policy for the development of our land and water resources
and for their better use by those people who cannot make
a living in their present positions. Only thus can we
permanently eliminate many millions of people from the
relief rolls on which their names are now found.
The extent of the usefulness of our great
natural inheritance of land and water depends on our mastery
of it. We are now so organized that science and invention
have given us the means of more extensive and effective
attacks upon the problems of nature than ever before.
We have learned to utilize water power, to reclaim deserts,
to recreate forests and to redirect the flow of population.
Until recently we have proceeded almost it random, making
These are many illustrations of the necessity
for such planning. Some sections of the Northwest and
Southwest which formerly existed as grazing land, were
spread over with a fair crop of grass. On this land the
water table lay a dozen or twenty feet below the surface,
and newly arrived settlers put this land under the plow.
Wheat was grown by dry farming methods. But in many of
these places today the water table under the land has
dropped to fifty or sixty feet below the surface and the
top soil in dry seasons is blown away like driven snow.
Falling rain, in the absence of grass roots, filters through
the soil, runs off the surface, or is quickly reabsorbed
into the atmosphere. Many million acres of such land must
be restored to grass or trees if we are to prevent a new
and man-made Sahara.
At the other extreme, there are regions
originally arid, which have been generously irrigated
by human engineering. But in some of these places the
hungry soil has not only absorbed the water necessary
to produce magnificent crops, but so much more water that
the water table has now risen to the point of saturation,
thereby threatening the future crops upon which many families
Human knowledge is great enough today to
give us assurance of success in carrying through the abandonment
of many millions of acres for agricultural use and the
replacing of these acres with others on which at least
a living can be earned.
The rate of speed that we can usefully employ
in this attack on impossible social and economic conditions
must be determined by business-like procedure. It would
be absurd to undertake too many projects at once or to
do a patch of work here and another there without finishing
the whole of an individual project. Obviously, the Government
cannot undertake national projects in every one of the
435 Congressional districts, or even in every one of the
48 States. The magnificent conception of national realism
and national needs that this Congress has built up has
not only set an example of large vision for all time,
but has almost consigned to oblivion our ancient habit
of pork-barrel legislation; to that we cannot and must
not revert. When the next Congress convenes I hope to
be able to present to it a carefully considered national
plan, covering the development and the human use of our
natural resources of land and water over a long period
In considering the cost of such a program
it must be clear to all of us that for many years to come
we shall be engaged in the task of rehabilitating many
hundreds of thousands of our American families. In so
doing we shall be decreasing future costs for the direct
relief of destitution. I hope that it will be possible
for the Government to adopt as a clear policy to be carried
out over a long period, the appropriation of a large,
definite, annual sum so that work may proceed year after
year not under the urge of temporary expediency, but in
pursuance of the well-considered rounded objective.
The third factor relates to security against
the hazards and vicissitudes of life. Fear and worry based
on unknown danger contribute to social unrest and economic
demoralization. If, as our Constitution tells us, our
Federal Government was established among other things,
"to promote the general welfare," it is our
plain duty to provide for that security upon which welfare
Next winter we may well undertake the great
task of furthering the security of the citizen and his
family through social insurance.
This is not an untried experiment. Lessons
of experience are available from States, from industries
and from many Nations of the civilized world. The various
types of social insurance are interrelated; and I think
it is difficult to attempt to solve them piecemeal. Hence,
I am looking for a sound means which I can recommend to
provide at once security against several of the great
disturbing factors in life--especially those which relate
to unemployment and old age. I believe there should be
a maximum of cooperation between States and the Federal
Government. I believe that the funds necessary to provide
this insurance should be raised by contribution rather
than by an increase in general taxation. Above all, I
am convinced that social insurance should be national
in scope, although the several States should meet at least
a large portion of the cost of management, leaving to
the Federal Government the responsibility of investing,
maintaining and safeguarding the funds constituting the
necessary insurance reserves. I have commenced to make,
with the greatest of care, the necessary actuarial and
other studies for the formulation of plans for the consideration
of the 74th Congress.
These three great objectives the security
of the home, the security of livelihood, and the security
of social insurance--are, it seems to me, a minimum of
the promise that we can offer to the American people.
They constitute a right which belongs to every individual
and every family willing to work. They are the essential
fulfillment of measures already taken toward relief, recovery
This seeking for a greater measure of welfare
and happiness does not indicate a change in values. It
is rather a return to values lost in the course of our
economic development and expansion.
Ample scope is left for the exercise of
private initiative. In fact, in the process of recovery,
I am greatly hoping that repeated promises of private
investment and private initiative to relieve the Government
in the immediate future of much of the burden it has assumed,
will be fulfilled. We have not imposed undue restrictions
upon business. We have not opposed the incentive of reasonable
and legitimate private profit. We have sought rather to
enable certain aspects of business to regain the confidence
of the public. We have sought to put forward the rule
of fair play in finance and industry.
It is true that there are a few among us
who would still go back. These few offer no substitute
for the gains already made, nor any hope for making future
gains for human happiness. They loudly assert that individual
liberty is being restricted by Government, but when they
are asked what individual liberties they have lost, they
are put to it to answer.
We must dedicate ourselves anew to a recovery
of the old and sacred possessive rights for which mankind
has constantly struggled homes, livelihood, and individual
security. The road to these values is the way of progress.
Neither you nor I will rest content until we have done
our utmost to move further on that road.
2. FIRESIDE CHAT -- June
It has been several months since I have
talked with you concerning the problems of government.
Since January, those of us in whom you have vested responsibility
have been engaged in the fulfillment of plans and policies
which had been widely discussed in previous months. It
seemed to us our duty not only to make the right path
clear but also to tread that path.
As we review the achievements of this session
of the Seventy-third Congress, it is made increasingly
clear that its task was essentially that of completing
and fortifying the work it had begun in March, l933. That
was no easy task, but the Congress was equal to it. It
has been well said that while there were a few exceptions,
this Congress displayed a greater freedom from mere partisanship
than any other peace-time Congress since the Administration
of President Washington himself. The session was distinguished
by the extent and variety of legislation enacted and by
the intelligence and good will of debate upon these measures.
I mention only a few of the major enactments.
It provided for the readjustment of the debt burden through
the corporate and municipal bankruptcy acts and the farm
relief act. It lent a hand to industry by encouraging
loans to solvent industries unable to secure adequate
help from banking institutions. It strengthened the integrity
of finance through the regulation of securities exchanges.
It provided a rational method of increasing our volume
of foreign trade through reciprocal trading agreements.
It strengthened our naval forces to conform with the intentions
and permission of existing treaty rights. It made further
advances towards peace in industry through the labor adjustment
act. It supplemented our agricultural policy through measures
widely demanded by farmers themselves and intended to
avert price destroying surpluses. It strengthened the
hand of the Federal Government in its attempts to suppress
gangster crime. It took definite steps towards a national
housing program through an act which I signed today designed
to encourage private capital in the rebuilding of the
homes of the Nation. It created a permanent Federal body
for the just regulation of all forms of communication,
including the telephone, the telegraph and the radio.
Finally, and I believe most important, it reorganized,
simplified and made more fair and just our monetary system,
setting up standards and policies adequate to meet the
necessities of modern economic life, doing justice to
both gold and silver as the metal bases behind the currency
of the United States. In the consistent development of
our previous efforts toward the saving and safeguarding
of our national life, I have continued to recognize three
related steps. The first was relief, because the primary
concern of any Government dominated by the humane ideals
of democracy is the simple principle that in a land of
vast resources no one should be permitted to starve. Relief
was and continues to be our first consideration. It calls
for large expenditures and will continue in modified form
to do so for a long time to come. We may as well recognize
that fact. It comes from the paralysis that arose as the
after-effect of that unfortunate decade characterized
by a mad chase for unearned riches and an unwillingness
of leaders in almost every walk of life to look beyond
their own schemes and speculations. In our administration
of relief we follow two principles: First, that direct
giving shall, wherever possible, be supplemented by provision
for useful and remunerative work and, second, that where
families in their existing surroundings will in all human
probability never find an opportunity for full self-maintenance,
happiness and enjoyment, we will try to give them a new
chance in new surroundings.
The second step was recovery, and it is
sufficient for me to ask each and every one of you to
compare the situation in agriculture and in industry today
with what it was fifteen months ago.
At the same time we have recognized the
necessity of reform and reconstruction --reform because
much of our trouble today and in the past few years has
been due to a lack of understanding of the elementary
principles of justice and fairness by those in whom leadership
in business and finance was placed -- reconstruction because
new conditions in our economic life as well as old but
neglected conditions had to be corrected. Substantial
gains well known to all of you have justified our course.
I could cite statistics to you as unanswerable measures
of our national progress -- statistics to show the gain
in the average weekly pay envelope of workers in the great
majority of industries --statistics to show hundreds of
thousands reemployed in private industries and other hundreds
of thousands given new employment through the expansion
of direct and indirect government assistance of many kinds,
although, of course, there are those exceptions in professional
pursuits whose economic improvement, of necessity, will
be delayed. I also could cite statistics to show the great
rise in the value of farm products -- statistics to prove
the demand for consumers' goods, ranging all the way from
food and clothing to automobiles and of late to prove
the rise in the demand for durable goods -- statistics
to cover the great increase in bank deposits and to show
the scores of thousands of homes and of farms which have
been saved from foreclosure.
But the simplest way for each of you to
judge recovery lies in the plain facts of your own individual
situation. Are you better off than you were last year?
Are your debts less burdensome? Is your bank account more
secure? Are your working conditions better? Is your faith
in your own individual future more firmly grounded?
Also, let me put to you another simple question:
Have you as an individual paid too high a price for these
gains? Plausible self-seekers and theoretical die-hards
will tell you of the loss of individual liberty. Answer
this question also out of the facts of your own life.
Have you lost any of your rights or liberty or constitutional
freedom of action and choice? Turn to the Bill of Rights
of the Constitution, which I have solemnly sworn to maintain
and under which your freedom rests secure. Read each provision
of that Bill of Rights and ask yourself whether you personally
have suffered the impairment of a single jot of these
great assurances. I have no question in my mind as to
what your answer will be. The record is written in the
experiences of your own personal lives.
In other words, it is not the overwhelming
majority of the farmers or manufacturers or workers who
deny the substantial gains of the past year. The most
vociferous of the doubting Thomases may be divided roughly
into two groups: First, those who seek special political
privilege and, second, those who seek special financial
privilege. About a year ago I used as an illustration
the 90% of the cotton manufacturers of the United States
who wanted to do the right thing by their employees and
by the public but were prevented from doing so by the
10% who undercut them by unfair practices and un-American
standards. It is well for us to remember that humanity
is a long way from being perfect and that a selfish minority
in every walk of life -- farming, business, finance and
even Government service itself -- will always continue
to think of themselves first and their fellow-being second.
In the working out of a great national program
which seeks the primary good of the greater number, it
is true that the toes of some people are being stepped
on and are going to be stepped on. But these toes belong
to the comparative few who seek to retain or to gain position
or riches or both by some short cut which is harmful to
the greater good. In the execution of the powers conferred
on it by Congress, the Administration needs and will tirelessly
seek the best ability that the country affords. Public
service offers better rewards in the opportunity for service
than ever before in our history -- not great salaries,
but enough to live on. In the building of this service
there are coming to us men and women with ability and
courage from every part of the Union. The days of the
seeking of mere party advantage through the misuse of
public power are drawing to a close. We are increasingly
demanding and getting devotion to the public service on
the part of every member of the Administration, high and
The program of the past year is definitely
in operation and that operation month by month is being
made to fit into the web of old and new conditions. This
process of evolution is well illustrated by the constant
changes in detailed organization and method going on in
the National Recovery Administration. With every passing
month we are making strides in the orderly handling of
the relationship between employees and employers. Conditions
differ, of course, in almost every part of the country
and in almost every industry. Temporary methods of adjustment
are being replaced by more permanent machinery and, I
am glad to say, by a growing recognition on the part of
employers and employees of the desirability of maintaining
fair relationships all around.
So also, while almost everybody has recognized
the tremendous strides in the elimination of child labor,
in the payment of not less than fair minimum wages and
in the shortening of hours, we are still feeling our way
in solving problems which relate to self-government in
industry, especially where such self-government tends
to eliminate the fair operation of competition.
In this same process of evolution we are
keeping before us the objectives of protecting on the
one hand industry against chiselers within its own ranks,
and on the other hand the consumer through the maintenance
of reasonable competition for the prevention of the unfair
sky-rocketing of retail prices.
But, in addition to this our immediate task,
we must still look to the larger future. I have pointed
out to the Congress that we are seeking to find the way
once more to well-known, long-established but to some
degree forgotten ideals and values. We seek the security
of the men, women and children of the Nation.
That security involves added means of providing
better homes for the people of the Nation. That is the
first principle of our future program.
The second is to plan the use of land and
water resources of this country to the end that the means
of livelihood of our citizens may be more adequate to
meet their daily needs. And, finally, the third principle
is to use the agencies of government to assist in the
establishment of means to provide sound and adequate protection
against the vicissitudes of modern life -- in other words,
Later in the year I hope to talk with you
more fully about these plans. A few timid people, who
fear progress, will try to give you new and strange names
for what we are doing. Sometimes they will call it "Fascism",
sometimes "Communism", sometimes "Regimentation",
sometimes "Socialism". But, in so doing, they
are trying to make very complex and theoretical something
that is really very simple and very practical.
I believe in practical explanations and
in practical policies. I believe that what we are doing
today is a necessary fulfillment of what Americans have
always been doing -- a fulfillment of old and tested American
Let me give you a simple illustration:
While I am away from Washington this summer,
a long needed renovation of and addition to our White
House office building is to be started. The architects
have planned a few new rooms built into the present all
too small one-story structure. We are going to include
in this addition and in this renovation modern electric
wiring and modern plumbing and modern means of keeping
the offices cool in the hot Washington summers. But the
structural lines of the old Executive Office Building
will remain. The artistic lines of the White House buildings
were the creation of master builders when our Republic
was young. The simplicity and the strength of the structure
remain in the face of every modern test. But within this
magnificent pattern, the necessities of modern government
business require constant reorganization and rebuilding.
If I were to listen to the arguments of
some prophets of calamity who are talking these days,
I should hesitate to make these alterations. I should
fear that while I am away for a few weeks the architects
might build some strange new Gothic tower or a factory
building or perhaps a replica of the Kremlin or of the
Potsdam Palace. But I have no such fears. The architects
and builders are men of common sense and of artistic American
tastes. They know that the principles of harmony and of
necessity itself require that the building of the new
structure shall blend with the essential lines of the
old. It is this combination of the old and the new that
marks orderly peaceful progress -- not only in building
buildings but in building government itself.
Our new structure is a part of and a fulfillment
of the old.
All that we do seeks to fulfill the historic
traditions of the American people. Other nations may sacrifice
democracy for the transitory stimulation of old and discredited
autocracies. We are restoring confidence and well-being
under the rule of the people themselves. We remain, as
John Marshall said a century ago, "emphatically and
truly, a government of the people." Our government
"in form and in substance ... emanates from them.
Its powers are granted by them, and are to be exercised
directly on them, and for their benefits."
Before I close, I want to tell you of the
interest and pleasure with which I look forward to the
trip on which I hope to start in a few days. It is a good
thing for everyone who can possibly do so to get away
at least once a year for a change of scene. I do not want
to get into the position of not being able to see the
forest because of the thickness of the trees.
I hope to visit our fellow Americans in
Puerto Rico, in the Virgin Islands, in the Canal Zone
and in Hawaii. And, incidentally, it will give me an opportunity
to exchange a friendly word of greeting to the Presidents
of our sister Republics: Haiti, Colombia and Panama.
After four weeks on board ship, I plan to
land at a port in our Pacific northwest, and then will
come the best part of the whole trip, for I am hoping
to inspect a number of our new great national projects
on the Columbia, Missouri and Mississippi Rivers, to see
some of our national parks and, incidentally, to learn
much of actual conditions during the trip across the continent
back to Washington.
While I was in France during the War our
boys used to call the United States "God's country".
Let us make it and keep it "God's country".
THE INITIATION OF STUDIES TO ACHIEVE A PROGRAM OF NATIONAL
SOCIAL AND ECONOMIC SECURITY. EXECUTIVE ORDER NO. 6757.
JUNE 29, 1934
By virtue of and pursuant to the authority
vested in me by the National Industrial Recovery Act (ch.
90, 48 Stat. 195), I hereby establish (1) the Committee
on Economic Security (hereinafter referred to as the Committee)
consisting of the Secretary of Labor, Chairman, the Secretary
of the Treasury, the Attorney General, the Secretary of
Agriculture, mid the Federal Emergency Relief Administrator,
and (2) the Advisory Council on Economic Security (hereinafter
referred to as the Advisory Council), the original members
of which shall be appointed by the President and additional
members of which may be appointed from time to time by
The Committee shall study problems relating
to the economic security of individuals and shall report
to the President not later than December 1, 1934, its
recommendations concerning proposals which in its judgment
will promote greater economic security.
The Advisory Council shall assist the Committee
in the consideration of all matters coming within the
scope of its investigations.
The Committee shall appoint (1) a Technical
Board on Economic Security consisting of qualified representatives
selected from various departments and agencies of the
Federal Government, and (2) an executive director who
shall have immediate charge of studies and investigations
to be carried out under the general direction of the Technical
Board, and who shall, with the approval of the Technical
Board, appoint such additional staff as may be necessity
to carry out the provisions of this order.
4. FIRESIDE CHAT-- SUNDAY,
SEPTEMBER 30, 1934
Three months have passed since I talked
with you shortly after the adjournment of the Congress.
Tonight I continue that report, though, because of the
shortness of time, I must defer a number of subjects to
a later date.
Recently the most notable public questions
that have concerned us all have had to do with industry
and labor and with respect to these, certain developments
have taken place which I consider of importance. I am
happy to report that after years of uncertainty, culminating
in the collapse of the spring of 1933, we are bringing
order out of the old chaos with a greater certainty of
the employment of labor at a reasonable wage and of more
business at a fair profit. These governmental and industrial
developments hold promise of new achievements for the
Men may differ as to the particular form
of governmental activity with respect to industry and
business, but nearly all are agreed that private enterprise
in times such as these cannot be left without assistance
and without reasonable safeguards lest it destroy not
only itself but also our processes of civilization. The
underlying necessity for such activity is indeed as strong
now as it was years ago when Elihu Root said the following
very significant words:
"Instead of the give and take of free
individual contract, the tremendous power of organization
has combined great aggregations of capital in enormous
industrial establishments working through vast agencies
of commerce and employing great masses of men in movements
of production and transportation and trade, so great in
the mass that each individual concerned in them is quite
helpless by himself. The relations between the employer
and the employed, between the owners of aggregated capital
and the units of organized labor, between the small producer,
the small trader, the consumer, and the great transporting
and manufacturing and distributing agencies, all present
new questions for the solution of which the old reliance
upon the free action of individual wills appear quite
inadequate. And in many directions, the intervention of
that organized control which we call government seems
necessary to produce the same result of justice and right
conduct which obtained through the attrition of individuals
before the new conditions arose."
It was in this spirit thus described by
Secretary Root that we approached our task of reviving
private enterprise in March, 1933. Our first problem was,
of course, the banking situation because, as you know,
the banks had collapsed. Some banks could not be saved
but the great majority of them, either through their own
resources or with government aid, have been restored to
complete public confidence. This has given safety to millions
of depositors in these banks. Closely following this great
constructive effort we have, through various Federal agencies,
saved debtors and creditors alike in many other fields
of enterprise, such as loans on farm mortgages and home
mortgages; loans to the railroads and insurance companies
and, finally, help for home owners and industry itself.
In all of these efforts the government has come to the
assistance of business and with the full expectation that
the money used to assist these enterprises will eventually
be repaid. I believe it will be.
The second step we have taken in the restoration
of normal business enterprise has been to clean up thoroughly
unwholesome conditions in the field of investment. In
this we have had assistance from many bankers and businessmen,
most of whom recognize the past evils in the banking system,
in the sale of securities, in the deliberate encouragement
of stock gambling, in the sale of unsound mortgages and
in many other ways in which the public lost billions of
dollars. They saw that without changes in the policies
and methods of investment there could be no recovery of
public confidence in the security of savings. The country
now enjoys the safety of bank savings under the new banking
laws, the careful checking of new securities under the
Securities Act and the curtailment of rank stock speculation
through the Securities Exchange Act. I sincerely hope
that as a result people will be discouraged in unhappy
efforts to get rich quick by speculating in securities.
The average person almost always loses. Only a very small
minority of the people of this country believe in gambling
as a substitute for the old philosophy of Benjamin Franklin
that the way to wealth is through work.
In meeting the problems of industrial recovery
the chief agency of the government has been the National
Recovery Administration. Under its guidance, trades and
industries covering over ninety percent of all industrial
employees have adopted codes of fair competition, which
have been approved by the President. Under these codes,
in the industries covered, child labor has been eliminated.
The work day and the work week have been shortened. Minimum
wages have been established and other wages adjusted toward
a rising standard of living. The emergency purpose of
the N. R. A. was to put men to work and since its creation
more than four million persons have been re-employed,
in great part through the cooperation of American business
brought about under the codes.
Benefits of the Industrial Recovery Program
have come, not only to labor in the form of new jobs,
in relief from over-work and in relief from under-pay,
but also to the owners and managers of industry because,
together with a great increase in the payrolls, there
has come a substantial rise in the total of industrial
profits - a rise from a deficit figure in the first quarter
of 1933 to a level of sustained profits within one year
from the inauguration of N. R. A.
Now it should not be expected that even
employed labor and capital would be completely satisfied
with present conditions. Employed workers have not by
any means all enjoyed a return to the earnings of prosperous
times; although millions of hitherto under- privileged
workers are today far better paid than ever before. Also,
billions of dollars of invested capital have today a greater
security of present and future earning power than before.
This is because of the establishment of fair, competitive
standards and because of relief from unfair competition
in wage cutting which depresses markets and destroys purchasing
power. But it is an undeniable fact that the restoration
of other billions of sound investments to a reasonable
earning power could not be brought about in one year.
There is no magic formula, no economic panacea, which
could simply revive over-night the heavy industries and
the trades dependent upon them.
Nevertheless the gains of trade and industry,
as a whole, have been substantial. In these gains and
in the policies of the Administration there are assurances
that hearten all forward-looking men and women with the
confidence that we are definitely rebuilding our political
and economic system on the lines laid down by the New
Deal - lines which as I have so often made clear, are
in complete accord with the underlying principles of orderly
popular government which Americans have demanded since
the white man first came to these shores. We count, in
the future as in the past, on the driving power of individual
initiative and the incentive of fair private profit, strengthened
with the acceptance of those obligations to the public
interest which rest upon us all. We have the right to
expect that this driving power will be given patriotically
and whole-heartedly to our nation.
We have passed through the formative period
of code making in the National Recovery Administration
and have effected a reorganization of the N. R. A. suited
to the needs of the next phase, which is, in turn, a period
of preparation for legislation which will determine its
In this recent reorganization we have recognized
three distinct functions. First, the legislative or policy
making function. Second, the administrative function of
code making and revision and, third, the judicial function,
which includes enforcement, consumer complaints and the
settlement of disputes between employers and employees
and between one employer and another.
We are now prepared to move into this second
phase, on the basis of our experience in the first phase
under the able and energetic leadership of General Johnson.
We shall watch carefully the working of
this new machinery for the second phase of N. R. A., modifying
it where it needs modification and finally making recommendations
to the Congress, in order that the functions of N. R.
A. which have proved their worth may be made a part of
the permanent machinery of government.
Let me call your attention to the fact that
the National Industrial Recovery Act gave businessmen
the opportunity they had sought for years to improve business
conditions through what has been called self-government
in industry. If the codes which have been written have
been too complicated, if they have gone too far in such
matters as price fixing and limitation of production,
let it be remembered that so far as possible, consistent
with the immediate public interest of this past year and
the vital necessity of improving labor conditions, the
representatives of trade and industry were permitted to
write their ideas into the codes. It is now time to review
these actions as a whole to determine through deliberative
means in the light of experience, from the standpoint
of the good of the industries themselves, as well as the
general public interest, whether the methods and policies
adopted in the emergency have been best calculated to
promote industrial recovery and a permanent improvement
of business and labor conditions. There may be a serious
question as to the wisdom of many of those devices to
control production, or to prevent destructive price cutting
which many business organizations have insisted were necessary,
or whether their effect may have been to prevent that
volume of production which would make possible lower prices
and increased employment. Another question arises as to
whether in fixing minimum wages on the basis of an hourly
or weekly wage we have reached into the heart of the problem
which is to provide such annual earnings for the lowest
paid worker as will meet his minimum needs. We also question
the wisdom of extending code requirements suited to the
great industrial centers and to large employers, to the
great number of small employers in the smaller communities.
During the last twelve months our industrial
recovery has been to some extent retarded by strikes,
including a few of major importance. I would not minimize
the inevitable losses to employers and employees and to
the general public through such conflicts. But I would
point out that the extent and severity of labor disputes
during this period has been far less than in any previous,
When the businessmen of the country were
demanding the right to organize themselves adequately
to promote their legitimate interests; when the farmers
were demanding legislation which would give them opportunities
and incentives to organize themselves for a common advance,
it was natural that the workers should seek and obtain
a statutory declaration of their constitutional right
to organize themselves for collective bargaining as embodied
in Section 7 (a) of the National Industrial Recovery Act.
Machinery set up by the Federal government has provided
some new methods of adjustment. Both employers and employees
mast share the blame of not using them as fully as they
should. The employer who turns away from impartial agencies
of peace, who denies freedom of organization to his employees,
or fails to make every reasonable effort at a peaceful
solution of their differences, is not fully supporting
the recovery effort of his government. The workers who
turn away from these same impartial agencies and decline
to use their good offices to gain their ends are likewise
not fully cooperating with their government.
It is time that we made a clean-cut effort
to bring about that united action of management and labor,
which is one of the high purposes of the Recovery Act.
We have passed through more than a year of education.
Step by step we have created all the government agencies
necessary to insure, as a general rule, industrial peace,
with justice for all those willing to use these agencies
whenever their voluntary bargaining fails to produce a
There should be at least a full and fair
trial given to these means of ending industrial warfare;
and in such an effort we should be able to secure for
employers and employees and consumers the benefits that
all derive from the continuous, peaceful operation of
our essential enterprises.
Accordingly, I propose to confer within
the coming month with small groups of those truly representative
of large employers of labor and of large groups of organized
labor, in order to seek their cooperation in establishing
what I may describe as a specific trial period of industrial
From those willing to join in establishing
this hoped-for period of peace, I shall seek assurances
of the making and maintenance of agreements, which can
be mutually relied upon, under which wages, hours and
working conditions may be determined and any later adjustments
shall be made either by agreement or, in case of disagreement,
through the mediation or arbitration of state or federal
agencies. I shall not ask either employers or employees
permanently to lay aside the weapons common to industrial
war. But I shall ask both groups to give a fair trial
to peaceful methods of adjusting their conflicts of opinion
and interest, and to experiment for a reasonable time
with measures suitable to civilize our industrial civilization.
Closely allied to the N. R. A. is the program
of Public Works provided for in the same Act and designed
to put more men back to work, both directly on the public
works themselves, and indirectly in the industries supplying
the materials for these public works. To those who say
that our expenditures for Public Works and other means
for recovery are a waste that we cannot afford, I answer
that no country, however rich, can afford the waste of
its human resources. Demoralization caused by vast unemployment
is our greatest extravagance. Morally, it is the greatest
menace to our social order. Some people try to tell me
that we must make up our minds that for the future we
shall permanently have millions of unemployed just as
other countries have had them for over a decade. What
may be necessary for those countries is not my responsibility
to determine. But as for this country, I stand or fall
by my refusal to accept as a necessary condition of our
future a permanent army of unemployed. On the contrary,
we must make it a national principle that we will not
tolerate a large army of unemployed and that we will arrange
our national economy to end our present unemployment as
soon as we can and then to take wise measures against
its return. I do not want to think that it is the destiny
of any American to remain permanently on relief rolls.
Those, fortunately few in number, who are
frightened by boldness and cowed by the necessity for
making decisions, complain that all we have done is unnecessary
and subject to great risks. Now that these people are
coming out of their storm cellars, they forget that there
ever was a storm. They point to England. They would have
you believe that England has made progress out of her
depression by a do-nothing policy, by letting nature take
her course. England has her pecularities and we have ours
but I do not believe any intelligent observer can accuse
England of undue orthodoxy in the present emergency.
Did England let nature take her course?
No. Did England hold to the gold standard when her reserves
were threatened? No. Has England gone back to the gold
standard today? No. Did England hesitate to call in ten
billion dollars of her war bonds bearing 5% interest,
to issue new bonds therefore bearing only 3 1/2% interest,
thereby saving the British Treasury one hundred and fifty
million dollars a year in interest alone? No. And let
it be recorded that the British bankers helped. Is it
not a fact that ever since the year 1909, Great Britain
in many ways has advanced further along lines of social
security than the United States? Is it not a fact that
relations between capital and labor on the basis of collective
bargaining are much further advanced in Great Britain
than in the United States? It is perhaps not strange that
the conservative British press has told us with pardonable
irony that much of our New Deal program is only an attempt
to catch up with English reforms that go back ten years
Nearly all Americans are sensible and calm
people. We do not get greatly excited nor is our peace
of mind disturbed, whether we be businessmen or workers
or farmers, by awesome pronouncements concerning the unconstitutionality
of some of our measures of recovery and relief and reform.
We are not frightened by reactionary lawyers or political
editors. All of these cries have been heard before. More
than twenty years ago, when Theodore Roosevelt and Woodrow
Wilson were attempting to correct abuses in our national
life, the great Chief Justice White said:
"There is great danger it seems to
me to arise from the constant habit which prevails where
anything is opposed or objected to, of referring without
rhyme or reason to the Constitution as a means of preventing
its accomplishment, thus creating the general impression
that the Constitution is but a barrier to progress instead
of being the broad highway through which alone true progress
may be enjoyed."
In our efforts for recovery we have avoided
on the one hand the theory that business should and must
be taken over into an all-embracing Government. We have
avoided on the other hand the equally untenable theory
that it is an interference with liberty to offer reasonable
help when private enterprise is in need of help. The course
we have followed fits the American practice of Government
- a practice of taking action step by step, of regulating
only to meet concrete needs - a practice of courageous
recognition of change. I believe with Abraham Lincoln,
that "The legitimate object of Government is to do
for a community of people whatever they need to have done
but cannot do at all or cannot do so well for themselves
in their separate and individual capacities."
I still believe in ideals. I am not for
a return to that definition of Liberty under which for
many years a free people were being gradually regimented
into the service of the privileged few. I prefer and I
am sure you prefer that broader definition of Liberty
under which we are moving forward to greater freedom,
to greater security for the average man than he has ever
known before in the history of America.
ADDRESS TO ADVISORY COUNCIL OF THE COMMITTEE ON ECONOMIC
SECURITY ON THE PROBLEMS OF ECONOMIC AND SOCIAL SECURITY.
NOVEMBER 14, 1934.
I am glad to welcome you to the White House
and tell you that I am happy that there is so much interest
in the problem of economic security. Last June I said
that this winter we might well make a beginning in the
great task of providing social insurance for the citizen
and his family. I have not changed my opinion. I shall
have recommendations on this subject to present to the
Many details are still to be settled. The
Committee on Economic Security was created to advise me
on this matter. It will bring to me, not any preconceived
views, but a mature judgment after careful study of the
problem and after consultation with the Advisory Conference
and the cooperating committees.
On some points it is possible to be definite.
Unemployment insurance will be in the program. I am still
of the opinion expressed in my message of June eighth
that this part of social insurance should be a cooperative
Federal-State undertaking. It is important that the Federal
Government encourage States which are ready to take this
progressive step. It is no less important that all unemployment
insurance reserve funds be held and invested by the Federal
Government, so that the use of these funds as a means
of stabilization may be maintained in central management
and employed on a national basis. Unemployment insurance
must be set up with the purpose of decreasing rather than
increasing unemployment. It is, of course, clear that
because of their magnitude the investment and liquidation
of reserve funds must be within control of the Government
For the administration of insurance benefits,
the States are the most logical units. At this stage,
while unemployment insurance is still untried in this
country and there is such a great diversity of opinion
on many details, there is room for some degree of difference
in methods, though not in principles. That would be impossible
under an exclusively national system. And so I can say
to you who have come from all parts of the country that
not only will there have to be a Federal law on unemployment
insurance, but State laws will also be needed. In January
the great majority of the State Legislatures will convene,
as well as Congress. You who are interested in seeing
that unemployment insurance is established on a nationwide
basis should make your plans accordingly.
We must not allow this type of insurance
to become a dole through the mingling of insurance and
relief. It is not charity. It must be financed by contributions,
What I have said must not be understood
as implying that we should do nothing further for the
people now on relief. On the contrary, they must be our
first concern. We must get them back into productive employment
and as we do so we can bring them under the protection
of the insurance system. Let us profit by the mistakes
of foreign countries and keep out of unemployment insurance
every element which is actuarially unsound.
There are other matters with which we must
deal before we shall give adequate protection to the individual
against the many economic hazards. Old age is at once
the most certain, and for many people the most tragic
of all hazards. There is no tragedy in growing old, but
there is tragedy in growing old without means of support.
As Governor of New York, it was my pleasure
to recommend passage of the Old-Age Pension Act which,
I am told, is still generally regarded as the most liberal
in the country. In approving the bill, I expressed my
opinion that full solution of this problem is possible
only on insurance principles. It takes so very much money
to provide even a moderate pension for everybody, that
when the funds are raised from taxation only a "means
test" must necessarily be made a condition of the
grant of pensions.
I do not know whether this is the time for
any Federal legislation on old-age security. Organizations
promoting fantastic schemes have aroused hopes which cannot
possibly be fulfilled. Through their activities they have
increased the difficulties of getting sound legislation;
but I hope that in time we may be able to provide security
for the aged--a sound and a uniform system which will
provide true security.
There is also the problem of economic loss
due to sickness--a very serious matter for many families
with and without incomes, and therefore, an unfair burden
upon the medical profession. Whether we come to this form
of insurance soon or later on, I am confident that we
can devise a system which will enhance and not hinder
the remarkable progress which has been made and is being
made in the practice of the professions of medicine and
surgery in the United States.
In developing each component part of the
broad program for economic security, we must not lose
sight of the fact that there can be no security for the
individual in the midst of general insecurity. Our first
task is to get the economic system to function so that
there will be a greater general security. Everything that
we do with intent to increase the security of the individual
will, I am confident, be a stimulus to recovery.
At this time, we are deciding on long-time
objectives. We are developing a plan of administration
into which can be fitted the various parts of the security
program when it is timely to do so. We cannot work miracles
or solve all our problems at once. What we can do is to
lay a sound foundation on which we can build a structure
to give a greater measure of safety and happiness to the
individual than any we have ever known. In this task,
you can greatly help.
MESSAGE TO CONGRESS ON SOCIAL SECURITY. JANUARY
In addressing you on June eighth, 1934, I summarized the main objectives of our American program. Among these was, and is, the security of the men, women, and children of the Nation against certain hazards and vicissitudes of life. This purpose is an essential part of our task. In my annual message to you I promised to submit a definite program of action. This I do in the form of a report to me by a Committee on Economic Security, appointed by me for the purpose of surveying the field and of recommending the basis of legislation.
I am gratified with the work of this Committee and of those who have helped it: The Technical Board on Economic Security drawn from various departments of the Government, the Advisory Council on Economic Security, consisting of informed and public spirited private citizens and a number of other advisory groups, including a committee on actuarial consultants, a medical advisory board, a dental advisory committee, a hospital advisory committee, a public health advisory committee, a child welfare committee and an advisory committee on employment relief. All of those who participated in this notable task of planning this major legislative proposal are ready and willing, at any time, to consult with and assist in any way the appropriate Congressional committees and members, with respect to detailed aspects.
It is my best judgment that this legislation should be brought forward with a minimum of delay. Federal action is necessary to, and conditioned upon, the action of States. Forty-four legislatures are meeting or will meet soon. In order that the necessary State action may be taken promptly it is important that the Federal Government proceed speedily.
The detailed report of the Committee sets forth a series of proposals that will appeal to the sound sense of the American people. It has not attempted the impossible, nor has it failed to exercise sound caution and consideration of all of the factors concerned: the national credit, the rights and responsibilities of States, the capacity of industry to assume financial responsibilities and the fundamental necessity of proceeding in a manner that will merit the enthusiastic support of citizens of all sorts.
It is overwhelmingly important to avoid any danger of permanently discrediting the sound and necessary policy of Federal legislation for economic security by attempting to apply it on too ambitious a scale before actual experience has provided guidance for the permanently safe direction of such efforts. The place of such a fundamental in our future civilization is too precious to be jeopardized now by extravagant action. It is a sound idea--a sound ideal. Most of the other advanced countries of the world have already adopted it and their experience affords the knowledge that social insurance can be made a sound and workable project.
Three principles should be observed in legislation on this subject. First, the system adopted, except for the money necessary to initiate it, should be self-sustaining in the sense that funds for the payment of insurance benefits should not come from the proceeds of general taxation. Second, excepting in old-age insurance, actual management should be left to the States subject to standards established by the Federal Government. Third, sound financial management of the funds and the reserves, and protection of the credit structure of the Nation should be assured by retaining Federal control over all funds through trustees in the Treasury of the United States.
At this time, I recommend the following types of legislation looking to economic security:
1. Unemployment compensation.
2. Old-age benefits, including compulsory and voluntary annuities.
3. Federal aid to dependent children through grants to States for the support of existing mothers' pension systems and for services for the protection and care of homeless, neglected, dependent, and crippled children.
4. Additional Federal aid to State and local public health agencies and the strengthening of the Federal Public Health Service. I am not at this time recommending the adoption of so called “health insurance,” although groups representing the medical profession are cooperating with the Federal Government in the further study of the subject and definite progress is being made.
With respect to unemployment compensation, I have concluded that the most practical proposal is the levy of a uniform Federal payroll tax, ninety per cent of which should be allowed as an offset to employers contributing under a compulsory State unemployment compensation act. The purpose of this is to afford a requirement of a reasonably uniform character for all States cooperating with the Federal Government and to promote and encourage the passage of unemployment compensation laws in the States. The ten per cent not thus offset should be used to cover the costs of Federal and State administration of this broad system. Thus, States will largely administer unemployment compensation, assisted and guided by the Federal Government. An unemployment compensation system should be constructed in such a way as to afford every practicable aid and incentive toward the larger purpose of employment stabilization. This can be helped by the intelligent planning of both public and private employment. It also can be helped by correlating the system with public employment so that a person who has exhausted his benefits may be eligible for some form of public work as is recommended in this report. Moreover, in order to encourage the stabilization of private employment, Federal legislation should not foreclose the States from establishing means for inducing industries to afford an even greater stabilization of employment.
In the important field of security for our old people, it seems necessary to adopt three principles: First, non-contributory old-age pensions for those who are now too old to build up their own insurance. It is, of course, clear that for perhaps thirty years to come funds will have to be provided by the States and the Federal Government to meet these pensions. Second, compulsory contributory annuities which in time will establish a self-supporting system for those now young and for future generations. Third, voluntary contributory annuities by which individual initiative can increase the annual amounts received in old age. It is proposed that the Federal Government assume one-half of the cost of the old-age pension plan, which ought ultimately to be supplanted by self-supporting annuity plans.
The amount necessary at this time for the initiation of unemployment compensation, old-age security, children's aid, and the promotion of public health, as outlined in the report of the Committee on Economic Security, is approximately one hundred million dollars.
The establishment of sound means toward a greater future economic security of the American people is dictated by a prudent consideration of the hazards involved in our national life. No one can guarantee this country against the dangers of future depressions but we can reduce these dangers. We can eliminate many of the factors that cause economic depressions, and we can provide the means of mitigating their results. This plan for economic security is at once a measure of prevention and a method of alleviation.
We pay now for the dreadful consequence of economic insecurity—and dearly. This plan presents a more equitable and infinitely less expensive means of meeting these costs. We cannot afford to neglect the plain duty before us. I strongly recommend action to attain the objectives sought in this report.
PRESIDENTIAL STATEMENT SIGNING THE SOCIAL SECURITY ACT.
Today a hope of many years' standing is
in large part fulfilled. The civilization of the past
hundred years, with its startling industrial changes,
has tended more and more to make life insecure. Young
people have come to wonder what would be their lot when
they came to old age. The man with a job has wondered
how long the job would last.
This social security measure gives at least
some protection to thirty millions of our citizens who
will reap direct benefits through unemployment compensation,
through old-age pensions and through increased services
for the protection of children and the prevention of ill
We can never insure one hundred percent
of the population against one hundred percent of the hazards
and vicissitudes of life, but we have tried to frame a
law which will give some measure of protection to the
average citizen and to his family against the loss of
a job and against poverty-ridden old age.
This law, too, represents a cornerstone
in a structure which is being built but is by no means
complete. It is a structure intended to lessen the force
of possible future depressions. It will act as a protection
to future Administrations against the necessity of going
deeply into debt to furnish relief to the needy. The law
will flatten out the peaks and valleys of deflation and
of inflation. It is, in short, a law that will take care
of human needs and at the same time provide the United
States an economic structure of vastly greater soundness.
I congratulate all of you ladies and gentlemen,
all of you in the Congress, in the executive departments
and all of you who come from private life, and I thank
you for your splendid efforts in behalf of this sound,
needed and patriotic legislation.
If the Senate and the House of Representatives
in this long and arduous session had done nothing more
than pass this Bill, the session would be regarded as
historic for all time.
A RECOMMENDATION FOR LEGISLATION AMENDING THE SOCIAL SECURITY
ACT- DECEMBER 14, 1937.
My Dear Senator:
Mr. Altmeyer, Chairman of the Social Security
Board, has submitted to me some non-controversial amendments
to the Social Security Act. In brief, they cover the points
listed in the attached memorandum. I feel they are of
sufficient importance to warrant their passage at the
earliest possible date.
As these amendments will considerably improve
the effectiveness of this important Act, I have asked
Chairman Altmeyer to discuss this matter with you personally.
Best wishes to you.
Very Sincerely yours,
Honorable Pat Harrison,
United States Senate,
(A similar letter was sent to Congressman Robert L. Doughton.)
Summary of Amendments to the Social Security
Act, forwarded with the foregoing letter.
1. To pay death claims direct to the wife
or dependent children and save expense of probating estates--as
in veterans' laws. This would save real money to the widow
and to the Board.
2. To change "wages payable" in
unemployment compensation to "wages paid" as
in old-age insurance and permit a duplicate list of wage
payments and so complete our efforts greatly to simplify
employers' wage reports.
3. To enable "merit rating" to
work by making technical changes. It becomes effective
in Wisconsin, January 1, 1938.
4. To permit earlier payment of unemployment
compensation in states that passed their laws late. For
two years funds have been built up in these states. With
increasing unemployment this will get money earlier to
those laid off.
5. To permit persons now 60 and over to
continue working through 1941 to qualify upon retirement
for monthly old-age annuities instead of receiving small
lump sum payments. A great gain all around.
6. To increase coverage.
a. To seamen on American vessels. Approved by Maritime
Commission and the International Seamen's Union and the
National Maritime Union.
b. To employees of national banks, state banks that are
members of the Federal Reserve System, institutions that
are members of the Home Loan Bank system, and the like.
The American Bankers Association approves.
NOTE: In signing the Social Security Act on August
14, 1935, I stated that it "represents a cornerstone
in a structure which is being built but is by no means
complete" (see Item 107, 1935 volume). The Act constituted
a pioneer effort on the part of the Federal Government,
but although it was comprehensive in scope we recognized
that it would have to be developed with experience.
After over two years of operation of
the Social Security Act, we concluded that it should be
expanded in certain directions. Accordingly, I urged Senator
Harrison, the Chairman of the Finance Committee of the
Senate, and Representative Doughton, the Chairman of the
Ways and Means Committee of the House of Representatives,
to consider the changes in the Act outlined by Chairman
Altmeyer of the Social Security Board in the foregoing
During 1938, Senator Harrison and Representative
Doughton held frequent conferences with Chairman Altmeyer.
Meanwhile, several new amendments to the Act seemed advisable
and on April 28, 1938, I wrote to Chairman Altmeyer advocating
that the old-age insurance system be revised and extended
to provide for earlier payments. I also recommended that
further liberalizing changes be made in the old-age insurance
provisions of the Act (see Item 56, 1938 volume).
Inasmuch as several additional substantive
amendments were being developed by the Social Security
Board, it was decided to postpone congressional hearings
upon all amendments until the final report of the Board
was submitted. By the close of 1938, this report had been
completed, and I transmitted it to the Congress on January
16, 1939 (see Item 11, 1939 volume).
After the report was submitted, hearings
were held upon the amendments outlined in the foregoing
letter and also upon the later suggestions of the Social
Security Board. Many of these recommendations were enacted
and approved by me on August 10, 1939 (Public No. 379,
76th Congress; 53 Stat. 1360).
(For a discussion of the nature of these
amendments, see Item 109 and note, 1939 volume.)
A RECOMMENDATION FOR LIBERALIZING THE OLD-AGE INSURANCE
SYSTEM -- APRIL 28, 1938.
My Dear Mr. Chairman:
I am very anxious that in the press of administrative
duties the Social Security Board will not lose sight of
the necessity of studying ways and means of improving
and extending the provisions of the Social Security Act.
The enactment of the Social Security Act
marked a great advance in affording more equitable and
effective protection to the people of this country against
widespread and growing economic hazards. The successful
operation of the Act is the best proof that it was soundly
conceived. However, it would be unfortunate if we assumed
that it was complete and final. Rather, we should be constantly
seeking to perfect and strengthen it in the light of our
accumulating experience and growing appreciation of social
I am particularly anxious that the Board
give attention to the development of a sound plan for
liberalizing the old-age insurance system. In the development
of such a plan I should like to have the Board give consideration
to the feasibility of extending its coverage, commencing
the payment of old-age insurance annuities at an earlier
date than January 1, 1942, paying larger benefits than
now provided in the Act for those retiring during the
earlier years of the system, providing benefits for aged
wives and widows, and providing benefits for young children
of insured persons dying before reaching retirement age.
It is my hope that the Board will be prepared to submit
its recommendations before Congress reconvenes in January.
Very truly yours,
Mr. Arthur J. Altmeyer,
Social Security Board,
NOTE: The Social Security Act (Public
No. 271, 74th Congress; 49 Stat. 620) expressly provides
that the Social Security Board shall conduct studies and
make recommendations related to the most effective methods
of providing economic security through social insurance.
Pursuant to the foregoing request, the
Board made a thorough survey of those proposals which
I suggested in my letter to Chairman Altmeyer, along with
various other changes which it appeared advisable to make.
The Board submitted its report and recommendations; and
I transmitted it to the Congress on January 16, 1939 (see
Item 11, 1939 volume).
The report of the Board advocated the
adoption of all the suggestions which I had asked in the
above letter to be considered. Subsequently, these recommendations
were written into law when the amendments to the Social
Security Act were adopted on August 11, 1939 (see Item
109, 1939 volume).
1. Extending the coverage of the old-age
insurance system. Under the 1939 amendments, the old-age
insurance provisions of the Social Security Act were extended
to include about 1,100,000 additional persons. The additional
groups covered were seamen, bank employees, and employed
persons, age sixty-five and over.
2. Commencing the payment of old-age
insurance annuities at an earlier date than January 1,
1942. The 1939 amendments advanced the date for beginning
monthly old-age insurance benefit payments to January
3. Paying larger benefits than now provided
in the Act for those retiring during the earlier years
of the system. Under the original Act, the basic amount
paid in old-age retirement benefits was computed from
the total accumulated wages of the person retiring. Thus,
an individual who reached sixty-five within a short time
after the passage of the Act would not have a very large
annuity because the wages accumulated would be small.
Under the amendments adopted in 1939, the basis for paying
benefits was changed from accumulated wages to average
wages. In this way, a person retiring in the early years
of the system would receive more than a paltry amount.
4. Providing benefits for aged wives
and widows. The 1939 amendments to the Act granted supplemental
benefits to the wife, age sixty-five or over, of an insured
individual. The total amount of the wife's benefit equals
one half of the husband's.
Additional provision was made for widows'
old-age insurance benefits. Since the adoption of the
1939 amendments, when the widow of a fully insured individual
reaches 65 she is eligible for a total benefit of three-fourths
of that of her late husband. Regardless of age, a widow
with one or more children now also receives a total benefit
equal to three-fourths of that of her late husband.
5. Providing benefits for young children
of insured persons dying before reaching retirement age.
Under the 1939 amendments, monthly insurance benefits
equal to one-half of the amount due to the parent are
made available to unmarried dependent orphans who have
not yet reached eighteen years of age.
"A Social Security Program Must Include All Those
Who Need Its Protection." RADIO ADDRESS ON THE THIRD
ANNIVERSARY OF THE SOCIAL SECURITY ACT. AUGUST
You, my friends, in every walk of life and
in every part of the Nation, who are active believers
in Social Security:
The Social Security Act is three years old
today. This is a good vantage point from which to take
a long look backward to its beginnings, to cast an appraising
eye over what it has accomplished so far, and to survey
its possibilities of future growth.
Five years ago the term "social security"
was new to American ears. Today it has significance for
more than forty million men and women workers whose applications
for old-age insurance accounts have been received; this
system is designed to assure them an income for life after
old age retires them from their jobs.
It has significance for more than twenty-seven
and a half million men and women wage earners who have
earned credits under State unemployment insurance laws
which provide half wages to help bridge the gap between
It has significance for the needy men, women
and children receiving assistance and for their families--at
least two million three hundred thousand all told; with
this cash assistance one million seven hundred thousand
old folks are spending their last years in surroundings
they know and with people they love; more than six hundred
thousand dependent children are being taken care of by
their own families; and about forty thousand blind people
are assured of peace and security among familiar voices.
It has significance for the families and
communities to whom expanded public health and child welfare
services have brought added protection. And it has significance
for all of us who, as citizens, have at heart the Security
and the well-being of this great democracy.
These accomplishments of three years are
impressive, yet we should not be unduly proud of them.
Our Government in fulfilling an obvious obligation to
the citizens of the country has been doing so only because
the citizens require action from their Representatives.
If the people, during these years, had chosen a reactionary
Administration or a "do nothing" Congress, Social
Security would still be in the conversational stage--a
beautiful dream which might come true in the dim distant
But the underlying desire for personal and
family security was nothing new. In the early days of
colonization and through the long years following, the
worker, the farmer, the merchant, the man of property,
the preacher and the idealist came here to build, each
for himself, a stronghold for the things he loved. The
stronghold was his home; the things he loved and wished
to protect were his family, his material and spiritual
His security, then as now, was bound to
that of his friends and his neighbors.
But as the Nation has developed, as invention,
industry and commerce have grown more complex, the hazards
of life have become more complex. Among an increasing
host of fellow citizens, among the often intangible forces
of giant industry, man has discovered that his individual
strength and wits were no longer enough. This was true
not only of the worker at shop bench or ledger; it was
true also of the merchant or manufacturer who employed
him. Where heretofore men had turned to neighbors for
help and advice, they now turned to Government.
Now this is interesting to consider. The
first to turn to Government, the first to receive protection
from Government, were not the poor and the lowly--those
who had no resources other than their daily earnings--but
the rich and the strong. Beginning in the nineteenth century,
the United States passed protective laws designed, in
the main, to give security to property owners, to industrialists,
to merchants and to bankers. True, the little man often
profited by this type of legislation; but that was a by-product
rather than a motive.
Taking a generous view of the situation,
I think it was not that Government deliberately ignored
the working man but that the working man was not sufficiently
articulate to make his needs and his problems known. The
powerful in industry and commerce had powerful voices,
both individually and as a group. And whenever they saw
their possessions threatened, they raised their voices
in appeals for government protection.
It was not until workers became more articulate
through organization that protective labor legislation
was passed. While such laws raised the standards of life,
they still gave no assurance of economic security. Strength
or skill of arm or brain did not guarantee a man a job;
it did not guarantee him a roof; it did not guarantee
him the ability to provide for those dependent upon him
or to take care of himself when he was too old to work.
Long before the economic blight of the depression
descended on the Nation, millions of our people were living
in wastelands of want and fear. Men and women too old
and infirm to work either depended on those who had but
little to share, or spent their remaining years within
the walls of a poorhouse. Fatherless children early learned
the meaning of being a burden to relatives or to the community.
Men and women, still strong, still young, but discarded
as gainful workers, were drained of self-confidence and
The millions of today want, and have a right
to, the same security their forefathers sought--the assurance
that with health and the willingness to work they will
find a place for themselves in the social and economic
system of the time.
Because it has become increasingly difficult
for individuals to build their own security single-handed,
Government must now step in and help them lay the foundation
stones, just as Government in the past has helped lay
the foundation of business and industry. We must face
the fact that in this country we have a rich man's security
and a poor man's security and that the Government owes
equal obligations to both. National security is not a
half and half manner: it is all or none.
The Social Security Act offers to all our
citizens a workable and working method of meeting urgent
present needs and of forestalling future need. It utilizes
the familiar machinery of our Federal-State government
to promote the common welfare and the economic stability
of the Nation.
The Act does not offer anyone, either individually
or collectively, an easy life--nor was it ever intended
so to do. None of the sums of money paid out to individuals
in assistance or in insurance will spell anything approaching
abundance. But they will furnish that minimum necessity
to keep a foothold; and that is the kind of protection
What we are doing is good. But it is not
good enough. To be truly national, a social security program
must include all those who need its protection. Today
many of our citizens are still excluded from old-age insurance
and unemployment compensation because of the nature of
their employment. This must be set aright; and it will
Some time ago I directed the Social Security
Board to give attention to the development of a plan for
liberalizing and extending the old-age insurance system
to provide benefits for wives, widows and orphans. More
recently, a National Health Conference was held at my
suggestion to consider ways and means of extending to
the people of this country more adequate health and medical
services and also to afford the people of this country
some protection against the economic losses arising out
of ill health.
I am hopeful that on the basis of studies
and investigations now under way, the Congress will improve
and extend the law. I am also confident that each year
will bring further development in Federal and State social
security legislation--and that is as it should be. One
word of warning, however. In our efforts to provide security
for all of the American people, let us not allow ourselves
to be misled by those who advocate short cuts to Utopia
of fantastic financial schemes.
We have come a long way. But we still have
a long way to go. There is still today a frontier that
remains unconquered--an America unclaimed. This is the
great, the nationwide frontier of insecurity, of human
want and fear. This is the frontier--the America--we have
set ourselves to reclaim.
This Third Anniversary would not be complete
if I did not express the gratitude of the Nation to those
splendid citizens who so greatly helped me in making social
security legislation possible and to those patriotic men
and women, both employers and employees, who in their
daily activities are today hearing social security work.
First of all, to the first woman who has
ever sat in the Cabinet of the United States--Miss Frances
Perkins--then and now the Secretary of Labor. Then to
the unselfish Commission of men and women who, in 1934,
devoted themselves to the almost superhuman task of studying
all manner of American problems, of examining legislation
already attempted in other nations, and of coordinating
the whole into practical recommendations for legislative
Finally, I thank publicly, as I have so
often thanked them privately, four men who have had long
and distinguished careers in the public service--Congressman
David J. Lewis of Maryland, who is known as one of the
Americas pioneers in the cause of Social Security; Senator
Robert F. Wagner of New York, who also was long its advocate;
Senator Harrison of Mississippi and Congressman Doughton
of North Carolina, who carried the bill successfully through
the Senate and the House of Representatives. They deserve
and have the gratitude of all of us for this service to
NOTE: The idea of Social Security, which
some reactionaries used to label as alien to the American
tradition, has become so firmly rooted here in America
that business, labor, finance, and all political parties
now accept it as a permanent system. During the years
since the passage of the original Social Security Act
in 1935, we have been constantly studying the system in
operation. As the result of many investigations and surveys,
we have been able to strengthen the original act and to
extend it to cover additional activities (see Item 163,
1937 volume; Item 56, this volume; Items 11 and 109, 1939
volume, and accompanying notes).
When I signed the Social Security Act,
I stated what I conceived to be the basic purposes of
the legislation (see Item 107 and note, 1935 volume, for
a more detailed analysis of how the various phases of
the Act actually operate). The program attempts to deal
with many of the factors which make for economic insecurity
among our people.
The first threat against security--that
of spending one's aged years in the poor house is dispelled
in two ways. In the first place, an old-age insurance
system is established, enabling retirement at sixty-five
on a pension. The amount of the pension depends upon wages
received and taxes paid by both employers and employees.
At present (1941), payrolls and wages are taxed 2 percent
in order to raise the funds to pay the statutory benefits
to workers and their wives who are over sixty-five. Survivors'
benefits are now also available for aged widows or aged
dependent parents, young widows with dependent children,
and unmarried dependent orphans under eighteen.
In the second place, an old-age assistance
program has been established, independent of the old-age
insurance system. The assistance is in the form of federal
grants-in-aid to the states to provide funds for the pensioning
and relief of old people. When the federal government
has approved the assistance plan of a particular state,
it contributes with the states on a 50-50 basis up to
a total of $40 per month per individual, with a little
extra for administrative purposes.
The other great threat to security is
the spectre of unemployment. Unemployment insurance has
been set up largely on a state-administered basis in cooperation
with the Federal Government. The federal payroll tax for
this purpose is merely nominal, employers being freed
from 90 percent of this tax if they contribute an equal
amount to state unemployment insurance plans approved
by the Social Security Board.
The United States Employment Service
also maintains employment offices in the states to facilitate
ready placement of job applicants where needed.
In addition to these forms of assistance,
federal grants are made by the Social Security Board in
varying amounts to assist the states in aiding dependent
children, and needy blind persons. Under the Social Security
Act, the Children's Bureau of the Department of Labor
administers grants to states for maternal and child welfare
and the aid of crippled children; the United States Public
Health Service administers grants to states to develop
state health programs; and the Office of Education administers
grants to states for vocational rehabilitation.
With the exception of the Children's
Bureau, all the above offices and bureaus have been placed
within the Federal Security Agency since the adoption
of Reorganization Plan No. 1 (see Item 66, 1939 volume).
From the standpoint of effective coordination of the social
security program, this is of great importance inasmuch
as closer working relationships have been established
among the Social Security Board, the United States Public
Health Service, the Office of Education, the National
Youth Administration, and the Civilian Conservation Corps.
Administratively, the Social Security
Board is composed of three members, appointed by the President
by and with the consent of the Senate. Not more than two
of the members may be of one political party; and the
President designates the chairman. Administrative and
executive action is in the hands of the executive director,
who also supervises and coordinates the work of the various
bureaus. The actuary of the Board performs the important
function of planning the various phases of the program
on a long-range basis to determine the adequacy of funds
available, benefits which can be paid, etc.
There are three operating bureaus and
three service bureaus within the Social Security Board.
The operating bureaus are:
1. The Bureau of Old-Age and Survivors'
Insurance, which administers the monthly benefits which
are paid to aged workers, their wives, or survivors and
dependent children, under the old-age insurance scheme.
2. The Bureau of Employment Security,
which administers the unemployment compensation features
of the Social Security Act; analyzes and certifies the
adequacy of state unemployment compensation laws; furnishes
technical aid to the states in drafting their legislation;
assists the states in developing their administrative
policies and specifications; supervises the functions
of the former United States Employment Service; aids farmers,
veterans and District of Columbia residents to obtain
employment; and assists public employment offices throughout
3. The Bureau of Public Assistance, which
supervises federal grants for old-age assistance, aid
to dependent children, and aid to the needy blind. It
advises and assists the states in initiating or amending
state public assistance laws, consults with the states
on technical problems, acts as a clearing house for information
gathered from the various states, and analyzes and develops
standards and procedures.
The service bureaus within the Social
Security Board consist of the Bureau of Research and Statistics,
the Bureau of Accounts and Audits, and the Informational
Service. These three service bureaus work in close conjunction
with the operating bureaus.
The Bureau of Research and Statistics
investigates such problems as the factors causing insecurity,
the adequacy of existing legislation, and the problems
caused by the application of the program to various population
groups. It plans and conducts the statistical service,
and advises the states on the statistical reports required
by the Board. The Bureau publishes a record of the volume
and trend of general relief in the United States, in collaboration
with other government and private agencies.
The Bureau of Accounts and Audits maintains
the accounting and auditing records of the Board. It has
charge of an administrative audit and also a field audit
of states receiving federal grants. It examines financial
insufficiency of state plans submitted, and assists the
states in improving their accounting procedures. It also
advises the Board on governmental fiscal programs.
The Informational Service keeps the public
posted, and answers inquiries about rights, benefits and
responsibilities under the Act. It also cooperates with
the states in planning and conducting their informational
In the fiscal year ending June 30, 1940,
individuals participating in the Social Security Act and
related state legislation received a total of $1,085,800,000
in comparison with $897,000,000 for the preceding year.
The amount for 1939-40 was distributed as follows:
Old-age and Survivors insurance......$17,600,000
The above amounts do not include the
funds allotted to the states to cover administrative expenses,
nor do they include expenditures by other federal agencies
for public health, welfare and vocational rehabilitation
services under the Social Security Act.
Since the United States Employment Service
has been consolidated into the Social Security Board,
the employment security program of the Board has been
expanded and strengthened. The state employment offices
maintained by federal funds filled more than 3,500,000
jobs during the past year, and were instrumental in making
1,100,000 supplementary placements. By the end of the
fiscal year 1940, there were close to 1,500 employment
offices and more than 3,000 itinerant service facilities
provided throughout the country. Having the information
drawn from state unemployment compensation systems at
its disposal, the Board is now in a strategic position
to help to bring workers and jobs together.
By June, 1940, approximately 28 million
workers had wage credits under state unemployment compensation
laws. At the same date, more than 40 million had received
wages counting toward old age benefits. During the fiscal
year, benefits were advanced to more than 5 million different
persons unemployed in that period, totaling nearly $500,000,000,
and the weekly average of workers receiving such benefits
exceeded $73,000. In addition, under the Railroad Unemployment
Insurance Act, administered by the Railroad Retirement
Board, 161,000 workers received benefits totaling $14,800,000.
In the brief period since January 1,
1940 that the old-age and survivors' insurance system
has been in operation, nearly 109,000 persons have received
monthly benefits. When this program reaches its peak level,
it will involve a larger number of persons and a larger
amount of funds than any phase of the social security
scheme. Although the amount already made available is
small in dollars, it has been invaluable in restoring
faith in the future.
The amendments to the Social Security
Act passed in 1939 stimulated the states to participate
actively in the public assistance plans under the Act.
About 2,200,000 needy aged persons, 55,000 blind persons,
and 1 million children in over 400,000 families were assisted
under the terms of the Act during the fiscal year 1939-1940.
It is interesting to note that whereas during the fiscal
year 1938-1939 public assistance to the needy aged, blind
and children constituted 14.4 percent of the aggregate
expenditures for public aid, in the year ending June 30,
1940, similar assistance represented 18.3 percent of the
aggregate expenditures of $3,300,000,000 by the Federal
Government for public aid.
The Social Security Board and the machinery
set up under the program have played an important role
in meeting the requirements of national defense. In April
1940, an inventory was made of the active file of those
who had registered at public employment offices. With
the work histories of 5 million job seekers available,
it was easier to determine what the existing labor reserves
were and where they existed.
In June 1940, the Social Security Board
assembled the Federal Advisory Council for Employment
Security to consider defense problems. This body, consisting
of representatives of employers, employees and the public,
was originally appointed to advise the Board on questions
arising in connection with the public employment offices.
After a two-day conference, the Advisory Council presented
an eight-point program which was accepted on June 28,
1940, by the Advisory Commission to the Council of National
This plan urged employers and employees
to communicate their immediate and prospective employment
requirements promptly to the local public employment office,
and to depend upon this machinery to fulfill their needs.
The employment offices were directed to recatalog the
skills available, and take steps to institute training
programs where there was a shortage. It was further recommended
that the decentralized features of this program be preserved,
that preference be accorded to citizens, and that in the
event of universal registration for defense an inventory
of employment qualifications be made.
Under the Second Deficiency Appropriation
Act, approved June 27, 1940, $2,000,000 was appropriated
to assist and supervise state employment services in selecting
and placing workers in national defense industries. Funds
were also provided for the Office of Education to cooperate
with the Social Security Board in providing vocational
training for workers selected from public employment registers.
Since the speeding up of the defense
program, there has been very close cooperation with the
National Defense Advisory Commission and the Office of
Production Management, the War and Navy Departments, the
Selective Service System, and Civil Service Commission.
The public employment offices, as of
October 31, 1940, have registered a total of 192,129 workers
equipped with skill or experience in about 500 different
industries, including such essential defense activities
as aircraft, machine shop work and machine tool manufacturing,
foundry work, construction, ship building, metal working,
electrical equipment, radio, telephone and telegraph.
The employment offices have aided measurably
in furthering the defense program through placing men
in these industries. There is special cooperation with
the Civil Service Commission in the maintenance of an
adequate supply of men for placement in arsenals and navy
yards. In order to maintain adequate labor reserves and
to guide the transfer of workers from point to point,
thirteen regional clearance offices have been established.
The Board has aided the War Department
in analyzing army jobs, and has helped local selective
service boards in assembling information to be used for
classification or deferment of workers. As the result
of visits to 20,000 defense plants, the Board has compiled
estimates of defense labor requirements to be supplied
to all of the defense agencies. These estimates are very
significant summaries of employment conditions, changes
in labor demand and supply, and trends in hiring practices.
In my message to the Congress on September
14, 1940, I called attention to the need for additional
legislation to protect the social insurance of those called
into military service (see Item 96, 1940 volume). The
Board has participated actively in developing plans for
taking care of those who joined the armed forces.
There is, of course, still room for improvement
in our social security system. I have repeatedly recommended
that it be extended to cover many of the occupations now
specifically exempted under the Act (see Item 163, 1937
volume; Item 56, this volume; Items 11 and 109, 1939 volume).
Also, the health provisions of the Social Security Act
are now inadequate to cover the costs of medical care
and provide for temporary or permanent disability.] There
are other changes which have been suggested from time
to time by the Board, the most pressing of which concerns
the plight of those states financially incapable of matching
federal grants for public assistance. In 1939, the Board
recommended that the grants be placed upon a different
basis in order to take care of the varying economic capacities
of the states; but the Congress failed to pass this proposal.
Yet the program has gone a long way toward
eliminating one of the most fearsome evils of our economic
system--insecurity. It has provided new life and hope
for millions of our citizens, and has bolstered the mechanisms
of our economy to help it withstand the dislocations of
war as well as the shock of great economic cycles of disaster
A MESSAGE TRANSMITTING TO THE CONGRESS A REPORT OF THE
SOCIAL SECURITY BOARD RECOMMENDING CERTAIN IMPROVEMENTS
IN THE LAW. -- JANUARY 16,
To the Congress:
Four years ago I sent to the newly convened
Congress a message transmitting a report of the Committee
on Economic Security. In that message I urged that Congress
consider the enactment into law of the program of protection
for our people outlined in that report. The Congress acted
upon that recommendation and today we have the Social
Security Act in effect throughout the length and breadth
of our country.
This Act has amply proved its essential
soundness. More than two and one half million needy old
people, needy blind persons, and dependent children are
now receiving systematic and humane assistance to the
extent of a half billion dollars a year.
Three and a half million unemployed persons
have received out-of-work benefits amounting to $400,000,000
during the last year.
A Federal old-age insurance system, the
largest undertaking of its kind ever attempted, has been
organized and under it there have been set up individual
accounts covering 42,500,000 persons who may be likened
to the policy holders of a private insurance company.
In addition there are the splendid accomplishments
in the field of public health, vocational rehabilitation,
maternal and child welfare and related services, made
possible by the Social Security Act.
We have a right to be proud of the progress
we have made in the short time the Social Security Act
has been in operation. However, we would be derelict in
our responsibility if we did not take advantage of the
experience we have accumulated to strengthen and extend
I submit for your consideration a report
of the Social Security Board, which, at my direction and
in accordance with the congressional mandate contained
in the Social Security Act itself, has been assembling
data, and developing ways and means of improving the operation
of the Social Security Act.
I particularly call attention to the desirability
of affording greater old age security. The report suggests
a two-fold approach which I believe to be sound. One way
is to begin the payment of monthly old-age insurance benefits
sooner, and to liberalize the benefits to be paid in the
early years. The other way is to make proportionately
larger Federal grants-in-aid to those states with limited
fiscal capacities, so that they may provide more adequate
assistance to those in need. This result can and should
be accomplished in such a way as to involve little, if
any, additional cost to the Federal Government. Such a
method embodies a principle that may well be applied to
other Federal grants-in-aid.
I also call attention to the desirability
of affording greater protection to dependent children.
Here again the report suggests a two-fold approach which
I believe to be sound. One way is to extend our Federal
old-age insurance system so as to provide regular monthly
benefits not only to the aged but also to the dependent
children of workers dying before reaching retirement age.
The other way is to liberalize the Federal grants-in-aid
to the states to help finance assistance to dependent
As regards both the Federal old-age insurance
system and the Federal-State unemployment compensation
system, equity and sound social policy require that the
benefits be extended to all of our people as rapidly as
administrative experience and public understanding permit.
Such an extension is particularly important in the case
of the Federal old-age insurance system. Even without
amendment the old-age insurance benefits payable in the
early years are very liberal in comparison with the taxes
paid. This is necessarily so in order that these benefits
may accomplish their purpose of forestalling dependency.
But this very fact creates the necessity of extending
this protection to as large a proportion as possible of
our employed population in order to avoid unfair discrimination.
Much of the success of the Social Security
Act is due to the fact that all of the programs contained
in this act (with one necessary exception) are administered
by the states themselves, but coordinated and partially
financed by the Federal Government. This method has given
us flexible administration, and has enabled us to put
these programs into operation quickly. However, in some
states incompetent and politically dominated personnel
has been distinctly harmful. Therefore, I recommend that
the states be required, as a condition for the receipt
of Federal funds, to establish and maintain a merit system
for the selection of personnel. Such a requirement would
represent a protection to the states and citizens thereof
rather than an encroachment by the Federal Government,
since it would automatically promote efficiency and eliminate
the necessity for minute Federal scrutiny of state operations.
I cannot too strongly urge the wisdom of
building upon the principles contained in the present
Social Security Act in affording greater protection to
our people, rather than turning to untried and demonstrably
unsound panaceas. As I stated in my message four years
ago: "It is overwhelmingly important to avoid any
danger of permanently discrediting the sound and necessary
policy of Federal legislation for economic security by
attempting to apply it on too ambitious a scale before
actual experience has provided guidance for the permanently
safe direction of such efforts. The place of such a fundamental
in our future civilization is too precious to be jeopardized
now by the extravagant action."
We shall make the most orderly progress
if we look upon social security as a development toward
a goal rather than a finished product. We shall make the
most lasting progress if we recognize that social security
can furnish only a base upon which each one of our citizens
may build his individual security through his own individual
NOTE: Back in 1934, I created an Advisory
Council on Economic Security to assist the Committee on
Economic Security in its investigations which eventually
led to the formulation and adoption of the Social Security
Act in 1935 (see Items 117 and 179, 1934 volume). The
Act was based upon the careful research and the thorough
studies and surveys made by both the Advisory Council
and the Committee.
Since the passage of the basic statute,
we have had considerable experience in the administration
of the social security program. We had an opportunity
to test the operation of its various features, in order
to determine the directions in which it might be plausible
to expand the Act.
In May 1937, another Advisory Council
on Social Security was appointed by the Social Security
Board and by a subcommittee of the Senate Committee on
Finance. This body was similar in some respects to the
old Advisory Council which I had created in 1934. It was
composed of twenty-five members, representing employers,
employees, and the public; and it concentrated its attention
upon the problems arising out of the operation of the
old-age insurance program.
Throughout 1937 and 1938, the Advisory
Council investigated the ways in which the old-age insurance
provisions of the Act could be improved. At the same time,
the Social Security Board itself was carrying on surveys,
and on December 14, 1937, Chairman Altmeyer submitted
to me a list of suggested improvements (see Item 163,
and note, 1937 volume). On April 28, 1938, I wrote to
Chairman Altmeyer requesting that the Board study some
additional changes in the old-age insurance provisions
(see Item 56, and note, 1938 volume).
The "Final Report of the Advisory
Council on Social Security," dated December 10, 1938,
was before the Committee on Finance of the Senate and
the Committee on Ways and Means of the House of Representatives
when they started their deliberations on the Act. The
report of the Social Security Board on the proposed changes
in the Act was also referred to the congressional committees
concerned, along with the foregoing message which I sent
to the Congress.
From February 1 until April 7, 1939,
the House Ways and Means Committee held hearings on possible
amendments to the Act, and over ninety social security
bills were referred to the Committee. H.R. 6635 finally
passed the House of Representatives on June 10, 1939,
by a vote of 361 to 2, and the bill as amended passed
Senate on July 13, 1939, by a vote of
57-8. After the adoption of the conference report, I signed
H.R. 6635 on August 10, 1939 as 53.Stat. 1360 (see Item
109, this volume).
Most of the reforms recommended by the
Social Security Board were embodied in the amendments
which were passed by the Congress. The following account
outlines changes which the Board advocated, and the extent
to which their suggestions were followed by the Congress:
1. Federal Old-Age Insurance
The Board recommended that monthly benefit payments start
in 1940 instead of on January 1, 1942, as scheduled. The
amendments advanced the date for beginning payments to
January 1, 1940.
Because those retiring in the early years
of the operation of the system would receive very small
amounts, the Board suggested that supplementary benefits
be provided for aged wives, and that average wages instead
of total wages be used as a basis for computing benefits.
Both these reforms were carried into effect when the amendments
were passed, with aged wives being granted supplementary
benefits totaling one-half of the old-age insurance benefit
of their husbands.
Under the Social Security Act of 1935,
single lump-sum cash payments amounting to 3 ½
percent of the worker's total wages were made at the time
of his death. The Board felt that monthly benefits to
widows and orphans would be preferable. These recommendations
were carried out by the 1939 amendments, which granted
monthly benefits to widows who had reached 65, unmarried
dependent orphans under 18, younger widows with children,
and aged dependent parents.
The Social Security Board recommended that the old-age
insurance system be extended to cover employees in large-scale
farming operations, and that eventually agricultural labor
be covered completely. Likewise, it was advocated that
the following groups be covered into the operation of
the Act: domestic service, maritime employment (with the
exception of foreign crews on American vessels engaged
in foreign trade), services performed for religious, educational,
charitable and non-profit organizations, services performed
for the federal and state governments or their instrumentalities,
those workers employed after they passed the age of 65,
and those workers performing personal service who did
not fall within the term "employee" as used
in this Act.
Under the 1939 amendments, three of the
above groups were placed within the system: maritime workers,
those earning wages after they reached 65, and employees
of federal instrumentalities, such as member banks in
the Federal Reserve System.
Several other clarifying amendments were
passed, such as the exemption of foreign governments and
their instrumentalities, the exclusion of any instrumentality
wholly state-owned or constitutionally tax-exempt, and
the coverage of an employee performing both excluded and
included types of employment where the latter predominates
during a particular pay period.
The Board made no definite recommendations regarding the
financing of the system, beyond stating that if additional
funds were needed, they should be raised by taxes other
than those on payrolls.
The 1939 amendments postponed until 1943
the increased taxes to be paid by employers and employees.
Under the original terms of the Act, the 1 percent old-age
insurance tax was to be stepped up to 1 ½ percent
during the years 1940, 1941, and 1942. However, the amendments
froze the rate of 1 percent until 1942, thus saving employers
and workers about $275,000,000 in 1940 and $825,000,000
for the three years.
d. Administrative changes
The following recommendations of the Board were enacted
in the 1939 amendments:
(1) Employers are now required to make
a statement to employees showing the amount of taxes deducted
from their wages under the old-age insurance system.
(2) The recovery by the Federal Government
of incorrect payments to individuals has been rendered
(3) Provisions have been made respecting
the practice of attorneys and agents before the Board.
(4) Employers are not required to pay
taxes on payments they make under any employer welfare
plan providing for retirement benefits, disability benefits,
medical and hospital expenses, etc.
2. Unemployment Compensation
In general, the Board advocated that coverage be extended
to the same groups which it suggested should be included
under the old-age insurance provisions of the Act. With
the passage of the amendments, about 200,000 additional
persons, chiefly bank employees, were brought into the
unemployment compensation branch of the system.
The Board felt that certain features of both the old-age
insurance and unemployment compensation sections of the
Act should be standardized. Since, under old-age insurance,
only the first $3,000 paid to an employee is taxed, a
similar recommendation was made for unemployment compensation,
and it was embodied in the 1939 amendments. A suggestion
that the tax provisions of the two systems be combined
or made identical, in order to facilitate record-keeping,
was not adopted. However, the Board asked that the taxes
for unemployment compensation be imposed on "wages
paid," instead of "wages payable," and
when the Congress adopted this amendment it established
the same basis as used in old-age insurance.
The Board proposed certain liberalizations
in the time limit within which an employer could qualify
for the 90 percent credit against the federal tax by contributing
to state unemployment insurance funds. As asked by the
Board, the time limit was extended where the employer
has paid his tax on time, but to the wrong state. Also,
the amendments of 1939 saved employers approximately $15,000,000
by providing that they would receive full credit for delinquent
1936, 1937 and 1938 taxes paid within sixty days after
the passage of the amendments. Other minor changes eased
the stringent provisions governing delinquent taxpayers.
c. Administrative changes
The following recommendations of the Board were subsequently
(1) As in the case of the old-age insurance
provisions of the law, payments under employer welfare
plans are made exempt from taxation.
(2) States are required to establish
and maintain a merit system for the personnel in unemployment
compensation agencies, in order to be eligible for federal
(3) The Board recommended that the administration
of unemployment compensation and of the United States
Employment Service should be placed within a single federal
bureau. Under Reorganization Plan No. 1, the United States
Employment Service was transferred from the Department
of Labor to the Federal Security Agency, and its functions
were consolidated with the unemployment compensation functions
of the Social Security Board (see Item 66, this volume).
(4) As in old-age insurance, the language
excluding state instrumentalities is clarified to apply
to any instrumentality wholly owned by the states or political
subdivisions thereof, as well as those exempt from tax
under the constitution.
(5) Exemption of foreign governments
and their instrumentalities from the unemployment compensation
(6) States are now required to enact
laws providing that expenditures be in accordance with
the provisions of the federal act.
(7) The provisions relating to "merit
rating" or "individual employer experience rating"
have been clarified in accordance with the recommendations
of the Social Security Board.
3. Public Assistance
The Board recommended that the present
uniform percentage grants be changed to a system which
would take into account the varying economic capacities
of the States. However, no action was taken by the Congress.
a. Old-age assistance, and aid to the
The Board proposed that federal contributions for the
administration of grants-in-aid to the states should be
increased. In the 1939 amendments it was provided that
the federal government contribute 50 percent of state
assistance payments to needy aged and blind up to a maximum
limit of $40 a month. Inasmuch as the previous limit was
$30 a month, the maximum federal grant per aged or blind
persons was thus increased from $15 to $20 per month.
b. Aid to dependent children. The following
recommendations of the Board were subsequently embodied
in the 1939 amendments to the Social Security Act:
(1) The contribution of the federal government
toward state aid to dependent children was increased from
one-third to one-half of the amount granted to each individual.
(2) Where a child is regularly attending
school, the age limit is raised from 16 to 18 to enable
most children to finish high school.
(3) Before the passage of the amendments,
the federal government was limited to contributing $18
per month for the first child and $12 per month for each
child thereafter. The Board suggested a liberalization
of this amount, and now the federal government will pay
one-half the amounts up to an average of $18 per child
per month throughout the state.
c. Public assistance for Indians
The Board advocated that the Federal Government reimburse
the states for the entire cost of public assistance to
certain Indians. No action was taken by the Congress upon
d. Maternal and child health services,
and services for crippled children.
Although the Social Security Board made no recommendations
on these aspects of public assistance, which are administered
by the Children's Bureau of the Department of Labor, testimony
presented to the Senate Committee holding hearings upon
the Wagner national health bill (see Item 17 and note,
this volume) showed the immediate need for expanding assistance
along these lines. Greater amounts of federal money, under
the 1939 amendments, are authorized to be appropriated
to assist the states in extending these services. The
total amount authorized to be appropriated for maternal
and child health grants was increased from $3,800,000
to $5,820,000, while that for crippled children was increased
from $2,850,000 to $3,870,000.
The 1939 amendments to those titles of
the Act covering aid to the needy aged, blind, dependent
children, maternal and child health services and services
for crippled children provided that approval of state
plans was contingent upon the establishment of personnel
standards on a merit basis.
c. Public health work
The Social Security Board urged the enactment of the National
Health Program presented by the Interdepartmental Committee
to Coordinate Health and Welfare Activities (see Item
17, and note, this volume). The amendments of 1939 stipulated
that the amount authorized to be appropriated for federal
aid to state public health programs should be increased
from $8,000,000 to $11,000,000. Following this increase,
particular emphasis has been placed upon developing control
of tuberculosis, malaria, cancer, pneumonia, and industrial
4. Vocational Rehabilitation
The Board made no additional recommendations
regarding this phase of the Social Security Act, but the
1939 amendments increased the annual allotment from $1,938,000
to $4,000,000, to be divided among the states, Hawaii
and Puerto Rico.
(For a discussion of the accomplishments
of the Social Security Act, see Item 107 and note, 1935
volume; and Item 103 and note, 1938 volume.)
Message to Congress on the National Health Program - January
To the Congress:
In my annual message to the Congress I referred
to problems of health security. I take occasion now to
bring this subject specifically to your attention in transmitting
the report and recommendations on national health prepared
by the Interdepartmental Committee to Coordinate Health
and Welfare Activities.
The health of the people is a public concern;
ill health is a major cause of suffering, economic loss,
and dependency; good health is essential to the security
and progress of the Nation.
Health needs were studied by the Committee
on Economic Security which I appointed in 1934 and certain
basic steps were taken by the Congress in the Social Security
Act. It was recognized at that time that a comprehensive
health program was required as an essential link in our
national defenses against individual and social insecurity.
Further study, however, seemed necessary at that time
to determine ways and means of providing this protection
In August, 1935, after the passage of the
Social Security Act, I appointed the Interdepartmental
Committee to Coordinate Health and Welfare Activities.
Early in 1938, this committee forwarded to me reports
prepared by its technical experts. They had reviewed unmet
health needs, pointing to the desirability of a national
health program, and they submitted the outlines of such
a program. These reports were impressive. I therefore
suggested that a conference be held to bring the findings
before representatives of the general public and of the
medical, public health, and allied professions.
More than 200 men and women, representing
many walks of life and many parts of our country, came
together in Washington last July to consider the technical
committee's findings and recommendations and to offer
further proposals. There was agreement on two basic points:
The existence of serious unmet needs for medical service;
and our failure to make full application of the growing
powers of medical science to prevent or control disease
I have been concerned by the evidence of
inequalities that exist among the States as to personnel
and facilities for health services. There are equally
serious inequalities of resources, medical facilities
and services in different sections and among different
economic groups. These inequalities create handicaps for
the parts of our country and the groups of our people
which most sorely need the benefits of modern medical
The objective of a national health program
is to make available in all parts of our country and for
all groups of our people the scientific knowledge and
skill at our command to prevent and care for sickness
and disability; to safeguard mothers, infants and children;
and to offset through social insurance the loss of earnings
among workers who are temporarily or permanently disabled.
The committee does not propose a great expansion
of Federal health services. It recommends that plans be
worked out and administered by States and localities with
the assistance of Federal grants-in-aid. The aim is a
flexible program. The committee points out that while
the eventual costs of the proposed program would be considerable,
they represent a sound investment which can be expected
to wipe out, in the long run, certain costs now borne
in the form of relief.
We have reason to derive great satisfaction
from the increase in the average length of life in our
country and from the improvement in the average levels
of health and well-being. Yet these improvements in the
averages are cold comfort to the millions of our people
whose security in health and survival is still as limited
as was that of the Nation as a whole fifty years ago.
The average level of health or the average
cost of sickness has little meaning for those who now
must meet personal catastrophes. To know that a stream
is four feet deep on the average is of little help to
those who drown in the places where it is ten feet deep.
The recommendations of the committee offer a program to
bridge that stream by reducing the risks of needless suffering
and death, and of costs and dependency, that now overwhelm
millions of individual families and sap the resources
of the Nation.
I recommend the report of the Interdepartmental
Committee for careful study by the Congress. The essence
of the program recommended by the Committee is Federal-State
cooperation. Federal legislation necessarily precedes,
for it indicates the assistance which may be made available
to the States in a cooperative program for the Nation's
Presidential Statement on Signing Some Amendments to the
Social Security Act --August 11, 1939
IT WILL be exactly four years ago on the fourteenth day
of this month that I signed the original Social Security
Act. As I indicated at that time and on various occasions
since that time, we must expect a great program of social
legislation, such as is represented in the Social Security
Act, to be improved and strengthened in the light of additional
experience and understanding. These amendments to the
Act represent another tremendous step forward in providing
greater security for the people of this country. This
is especially true in the case of the federal old age
insurance system which has now been converted into a system
of old age and survivors' insurance providing life-time
family security instead of only individual old age security
to the workers in insured occupations. In addition to
the worker himself, millions of widows and orphans will
now be afforded some degree of protection in the event
of his death whether before or after his retirement.
The size of the benefits to be paid during the early years
will be far more adequate than under the present law.
However, a reasonable relationship is retained between
wage loss sustained and benefits received. This is a most
important distinguishing characteristic of social insurance
as contrasted with any system of flat pensions.
Payment of old age benefits will begin on January 1, 1940,
instead of January 1, 1942. Increase in pay-roll taxes,
scheduled to take place in January, 1940, is deferred.
Benefit payments in the early years are substantially
I am glad that the insurance benefits have
been extended to cover workers in some occupations that
have previously not been covered. However, workers in
other occupations have been excluded. In my opinion, it
is imperative that these insurance benefits be extended
to workers in all occupations.
The Federal-State system of providing assistance to the
needy aged, the needy blind, and dependent children, has
also been strengthened by increasing the federal aid.
I am particularly gratified that the Federal matching
ratio to States for aid to dependent children has been
increased from one-third to one-half of the aid granted.
I am also happy that greater Federal contributions will
be made for public health, maternal and child welfare,
crippled children, and vocational rehabilitation. These
changes will make still more effective the Federal-State
cooperative relationship upon which the Social Security
Act is based and which constitutes its great strength.
It is important to note in this connection that the increased
assistance the States will now be able to give will continue
to be furnished on the basis of individual need, thus
affording the greatest degree of protection within reasonable
As regards administration, probably the most important
change that has been made is to require that State agencies
administering any part of the Social Security Act coming
within the jurisdiction of the Social Security Board and
the Children's Bureau shall set up a merit system for
their employees. An essential element of any merit system
is that employees shall be selected on a non-political
basis and shall function on a non-political basis.
In 1934 I appointed a committee called the Committee on
Economic Security made up of Government officials to study
the whole problem of economic and social security and
to develop a legislative program for the same. The present
law is the result of its deliberations. That committee
is still in existence and has considered and recommended
the present amendments. In order to give reality and coordination
to the study of any further developments that appear necessary
I am asking the committee to continue its life and to
make active study of various proposals which may be made
for amendments or developments to the Social Security
CAMPAIGN ADDRESS ON THE "ECONOMIC
BILL OF RIGHTS." OCTOBER
The American people are now engaged in the
greatest war in history--and we are also engaged in a
We are fighting this war and we are holding
this election--both for the same essential reason: because
we have faith in democracy.
And there is no force and there is no combination
of forces powerful enough to shake that faith.
As you know, I have had some previous experience
in war--and I have also had a certain amount of previous
experience in political campaigning.
But--I must confess--this is the strangest
campaign I have ever seen.
I have listened to the various Republican
orators who are urging the people to throw the present
Administration out and put them in. And what do they say?
Well, they say in effect, just this:
"Those incompetent bunglers in Washington
have passed a lot of excellent laws about social security
and labor and farm relief and soil conservation--and many
others--and we promise if elected not to change any of
And they go on to say: "These same
quarrelsome tired old men have built the greatest military
machine the world has ever known, which is fighting its
way to victory; and, if you elect us, we promise not to
change any of that, either."
"Therefore," say these Republican
orators, "it is time for a change."
They also say in effect: "Those inefficient
and worn out crackpots have really begun to lay the foundations
of a lasting world peace. If you elect us, we will not
change of any of that either." "But," they
whisper, "we'll do it in such a way that we won't
lose the support even of Gerald Nye or Gerald Smith--and-and
this is very important--we won't lose the support of any
isolationist campaign contributor. We will even be able
to satisfy the Chicago Tribune."
Tonight, I shall talk simply about the future
of America--about this land of unlimited opportunity.
I shall give the Republican campaign orators some more
opportunities to say--"me too."
Today everything we do is devoted to the
most important job before us--winning the war and bringing
our men and women home as quickly as possible.
We have astonished the world and confounded
our enemies with our stupendous war production, with the
overwhelming courage and skill of our fighting men--with
the bridge of ships carrying our munitions and men through
the seven seas--with our gigantic Fleet which has pounded
the enemy all over the Pacific and has just driven through
for a touchdown.
The American people are prepared to meet
the problems of peace in the same bold way that they have
met the problems of war.
For the American people are resolved that
when our men and women return home from this war, they
shall come back to the best possible place on the face
of this earth--to a place where all persons, regardless
of race, color, creed or place of birth, can live in peace,
honor and human dignity--free to speak, and pray as they
wish--free from want--and free from fear.
Last January, in my Message to the Congress
on the state of the Union, I outlined an Economic Bill
of Rights on which "a new basis of security and prosperity
can be established for all--regardless of station, race
I repeat them now:
"The right of a useful and remunerative
job in the industries, or shops or farms or mines of the
"The right to earn enough to provide
adequate food and clothing and recreation;
"The right of every farmer to raise
and sell his products at a return which will give him
and his family a decent living;
"The right of every business man, large
and small, to trade in an atmosphere of freedom from unfair
competition and domination by monopolies at home or abroad;
"The right of every family to a decent
"The right to adequate medical care
and the opportunity to achieve and enjoy good health;
"The right to adequate protection from
the economic fears of old age, sickness, accident and
"The right to a good education.
"All of these rights spell security.
And after this war is won we must be prepared to move
forward, in the implementation of these rights, to new
goals of human happiness and well-being."
Some people have sneered at these ideals
as well as the ideals of the Atlantic Charter and the
Four Freedoms--saying they were the dreams of starry-eyed
New Dealers--that it's silly to talk of them because we
cannot attain these ideals tomorrow or the next day.
The American people have greater faith than
that. I know that they agree with those objectives--that
they demand them--that they are determined to get them--and
that they are going to get them.
The American people have a habit of going
right ahead and accomplishing the impossible.
And the people today who know that best
are the Nazis and the Japs.
This Economic Bill of Rights is the recognition
of the simple fact that, in America, the future of the
worker and farmer lies in the well-being of private enterprise;
and that the future of private enterprise lies in the
well-being of the worker and farmer.
The well-being of the Nation as a whole
is synonymous with the well-being of each and every one
of its citizens.
Now, I have the possibly old fashioned theory
that when you have problems to solve, objectives to achieve,
you cannot get very far by just talking about them.
You have got to go out and do something!
To assure that full realization of the right
to a useful and remunerative employment, an adequate program
must provide America with close to sixty million productive
I foresee an expansion of our peacetime
productive capacity which will require new facilities,
new plants and new equipment--capable of hiring millions
I propose that Government do its part in
helping private enterprise to finance expansion of our
private industrial plant through normal investment channels.
For example, business, large and small,
must be encouraged by the Government to expand their plants
and to replace their obsolete or worn out equipment with
new equipment. And to that end, the rate of depreciation
on these new plants and facilities for tax purposes should
be accelerated. That means more jobs for the worker, increased
profits for the business man, and lower cost to the consumer.
In 1933, when my Administration took office,
vast numbers of our industrial workers were unemployed,
our plants and businesses were idle, our monetary and
banking system in ruins--our economic resources were running
By 1940--before Pearl Harbor--we had increased
our employment by ten million workers. We had converted
a corporate loss of five billion five hundred million
dollars in 1932, to a corporate profit (after taxes) of
nearly five billion dollars 1940.
Obviously, to increase jobs after this war,
we shall have to increase demand for our industrial and
agricultural production not only here at home, but also
I am sure that every man and woman in this
vast gathering here tonight agree with me in my conviction
that never again must we in the United States attempt
to isolate ourselves from the rest of humanity.
I am confident that, with Congressional
approval, tile foreign trade of the United States can
be trebled after the war--providing millions of more jobs.
Such cooperative measures provide the soundest
economic foundation for a lasting peace. And, after this
war, we do not intend to settle for anything less than
When we think of the America of tomorrow,
we think of many things.
One of them is American homes--in our cities,
in our villages and on our farms. Millions of our people
have never had homes worthy of American standards--well
built homes with electricity and plumbing and air and
The demand for homes and our capacity to
build them call for a program of well over a million homes
a year for at least ten years. Private industry can build
and finance the vast majority of these homes. Government
can and will assist and encourage private industry to
do this, as it has for many years. For those very low
income groups that cannot possibly afford decent homes,
the Federal Government should continue to assist local
housing authorities in meeting that need.
In the future America we think of new highways
and parkways. We think of thousands of new airports to
service the new commercial and private air travel which
is bound to come after the war. We think of new airplanes,
new cheap automobiles with low maintenance and operation
costs. We think of new hospitals and new health clinics.
We think of a new merchant marine for our expanded world
Think of all these vast possibilities for
industrial expansion--and you will foresee opportunities
for more millions of jobs.
Our Economic Bill of Rights--like the sacred
Bill of Rights of our Constitution itself--must be applied
to all our citizens, irrespective of race, creed or color.
In 1941, I appointed a Fair Employment Practice
Committee to prevent discrimination in war industry and
Government employment. The work of the Committee and the
results obtained more than justify its creation.
I believe that the Congress should by law
make the Committee permanent.
America must remain the land of high wages
and efficient production. Every full-time job in America
must provide enough for a decent living. And that goes
for jobs in mines, offices, factories, stores, canneries--and
everywhere where men and women are employed.
During the war we have been compelled to
limit wage and salary increases for one great objective--to
prevent runaway inflation. You all know how successfully
we have held the line by the way your cost of living has
been kept clown.
However, at the end of the war there wilt
be more goods available, and it is only good common sense
to see to it that the working man is paid enough, and
that the farmers earn enough, to buy these goods and keep
our factories running. It is a simple fact that a greatly
increased production of food and fibre on the forms can
be consumed by the people who work in industry only if
those people who work in industry have enough money to
buy food and clothing. If industrial wages go down, farm
prices will go down too. After the war, we shall of course
remove the control of wages and leave their determination
to free collective bargaining between trade unions and
In this war, the American farmer has been
called upon to do far and away the biggest food production
job in history.
The American farmer has met that challenge
Despite all manner of wartime difficulties--shortage
of farm labor and of new farm machinery--the American
farmer has achieved a total of food production which is
one of the wonders of the world.
The American farmer is a great producer;
and he must have the means to be also a great consumer.
For more farm income means more jobs everywhere in the
Let us look back for a moment to 1932. All
of us remember the spreading tide of farm foreclosures;
we remember four-cent hogs, twenty-cent wheat, five-cent
I am going to give you some figures of recovery--and
I am sure you will pardon me if I quote them correctly.
In 1932 the American farmers' net income
was only two and a quarter billion dollars.
In 1940--a year before we were attacked--farm
income was more than doubled to five and a half billion
This year--1944--it will be approximately
thirteen and a half billion dollars.
Certainly the American farmer does not want
to go back to a Government owned by the moguls of 1929--and
let us bear it constantly in mind that those same moguls
still control the destinies of the Republican Party.
We must continue this Administration's policy
of conserving the enormous gifts with which an abundant
Providence has blessed our country--our soil, our forests,
The work of the Tennessee Valley Authority
related to our national farm program, and
we look toward the similar developments which I have recommended
in the valley of the Missouri--in the valley of the Arkansas--and
in the Columbia River Basin.
And accidentally--and as an aside--I cannot
resist the temptation to point to the gigantic contribution
to our war effort made by the power generated at TVA and
Bonneville and Grand Coulee.
Do you remember when the building of these
great public works was ridiculed as New Deal "boondoggling"?
And we are now planning developments at Grand Coulee,
which will provide irrigation for many thousands of acres--providing
fertile firm land for settlement--I hope--by many of our
returning soldiers and sailors.
This Administration has put into the law
of the land the farmers' long dream of parity prices.
And we propose, too, that the Government
will cooperate when the weather will not--by a genuine
crop insurance program.
This Administration adopted--and will continue--the
policy of giving so many farmers as possible the chance
of owning their own farms.
That means something to those veterans who
left their farms to fight for their country.
This time they can grow apples on their
own farms instead of having to sell apples on street corners.
I believe in free enterprise--and always
I believe in the profit system--and always
I believe that private enterprise can give
full employment to our people.
And if anyone feels that my faith in our
ability to provide sixty million peacetime jobs is fantastic,
let him remember that some people said the same thing
about my demand in 1940 for fifty thousand airplanes.
I believe in exceptional rewards for innovation,
skill, and risk-taking by business.
We shall lift production and price control
as soon as they are no longer needed--encouraging private
business to produce more of the things to which we are
accustomed and also thousands of new things, in ever-increasing
volume, under conditions of free and open competition.
This Administration has been mindful from
its earliest days, and will continue to be mindful, of
the problems of small business as well as large.
Small business played a magnificent part
in producing thousands of items needed for our Armed Forces.
When the war broke out, it was mobilized into war production.
Money was loaned to them for machinery. Over one million
prime and subcontracts have been distributed among sixty
thousand smaller plants of the Nation.
We shall make sure that small business is
given every facility to buy Government-owned plants, equipment
and inventories. The special credit and capital requirements
of small business will be met.
And small business will continue to be protected
from selfish and cold-blooded monopolies and cartels.
Beware of that profound enemy of the free enterprise system
who pays lip-service to free competition--but also labels
every antitrust prosecution as a "persecution."
This war has demonstrated that when the
American business man and the American worker and the
American farmer work together, they form an unbeatable
We know that--our Allies know that--and
so do our enemies.
That winning team must keep together after
the war, and it will win many more historic victories
of peace for our country, and for the cause of security
and decent standards of living throughout the world.
We owe it to our fighting men and to their
families--we owe it to all of our people who have given
so much in this war--we owe it to our children--to keep
that winning team together.
The future of America, like its past, must
be made by deeds--not words.
America has always been a land of action--a
land of adventurous pioneering--a land of growing and
America must always be such a land.
The creed of our democracy is that liberty
is acquired and kept by men and women who are strong and
self-reliant, and possessed of such wisdom as God gives
to mankind--men and women who are just, and understanding,
and generous to others--men and women who are capable
of disciplining themselves.
For they are the rulers and they must rule
I believe in our democratic faith and in
the future of our country which has given eternal strength
and vitality to that faith.
Here in Chicago you know a lot about that
And as I say good-night to you, I say it
in a spirit of faith--a spirit of hope--a spirit of confidence.
We are not going to turn back the clock!
We are going forward--and--with the fighting
millions of our fellow countrymen--we are going forward