Last week, the Congressional Budget Office released a report predicting that Obama’s healthcare law would lead people to work less, because it claims that the law will kill more than 2 million jobs. Obama supporters suggested that the ability to buy health insurance outside of the workforce would give more flexibility to workers who felt trapped in jobs they hated or those who wanted to spend time with their children. Critics of the president saw it as another example of the government using tax dollars to encourage people not to work.
On Fox News Sunday’s roundtable panel, syndicated columnist George Will offered his take on the origins of Social Security, linking it to his opinion on the healthcare law. According to Will, Social Security was advocated in the 1930s to get people to quit working, rather than a desire to help keep the elderly out of poverty.
After the segment aired, this theory was brought to eight different historians who’ve written about the 1930’s, but none of them found much evidence supporting the idea that Roosevelt or his administration used Social Security to get people to quit working.
They did say that during that time in the United States, a different pension proposal, known as the Townsend Plan, was quite popular. The proposal stated that the government would provide $200-a-month pension to citizens aged 60 or older, funded by a national tax. This money would need to be spent within 30 days, a plan which was supposed to encourage spending and help free up jobs. The proposal rose fast in popularity but didn’t make sense financially or economically. It did, however, have enough strength to push Roosevelt to fast-track an alternative, Social Security.
So, the idea that old-age pension would transition older Americans out of the labor market, making way for younger, unemployed workers may have been a goal of the Townsend plan, but Roosevelt’s Social Security was targeted towards alleviating poverty among the elderly.
Kenneth G. Marks has been practicing personal injury law since he was admitted to the California Bar in 1981. www.KmarksLaw.com