President Roosevelt’s Committee on Economic Security – 1934

Introduction: The President’s Committee on Economic Security (CES) was formed in June 1934 and was given the task of devising “recommendations concerning proposals which in its judgment will promote greater economic security.” In a message to Congress two weeks earlier President Roosevelt spelled-out what he expected the CES to achieve. “. . . 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.”

 

The Committee’s work was extraordinary in its scope and remarkable for its brevity. In barely six months the CES designed the first comprehensive federal social insurance program in the nation’s history. Not everything contemplated by the CES at the outset made it into their final proposal, for example, health insurance was deferred for later study. And not everything in the CES proposal made it into the final law, for example, the proposal for voluntary old-age annuities did not survive Congressional review. But the Report of the CES was the basic blueprint for what would come to be the Social Security Act. The work of the CES was in many ways historic and in some ways heroic. One of the participants in this watershed undertaking, Thomas Eliot, in his posthumously published memoir, described his work with the CES in this way: “And what was it like, to be there? The best way to answer that question is to quote Wordsworth: ‘Bliss was it in that dawn to be alive, And to be young was very Heaven.’ “

A Complex StructureThe Committee on Economic Security (CES) actually had four parts: an executive leadership group (called the CES); an Advisory Council; a Technical Board; and an Executive Director.

The executive group was the ultimate decision making authority on the CES. It consisted of five of President Roosevelt’s cabinet-level officials: the Chairwoman was Frances Perkins, FDR’s Secretary of Labor; the other members were Secretary of the Treasury Henry Morgenthau Jr.; Attorney General Homer S. Cummings; Secretary of Agriculture Henry A. Wallace; and Harry L. Hopkins, the Federal Emergency Relief Administrator and President Roosevelt’s closest adviser.

The Executive Director was an economics professor from the University of Wisconsin, Edwin Witte. Witte had worked in state government in Wisconsin and he was a former student of Professor John R. Commons at the University of Wisconsin. Witte was one of the nation’s leading experts in social insurance and was an active member of the American Association for Labor Legislation.

One of the first staffers Witte would hire was a young student fresh out of the University of Wisconsin, Wilbur Cohen. Cohen was also a former student of John R. Commons, and of Witte himself. Wilbur Cohen would become the first employee of the Social Security Board and would go on to play a prominent role in Social Security for more than fifty years, including a brief tenure as Secretary of Health, Education and Welfare.

The Advisory Council was a group of 23 civic leaders from outside the Roosevelt Administration who had an interest in some fashion in the legislation to be developed.

(Three of the members of the Advisory Council would have continued importance to Social Security. Marion Folsom would go on to become Secretary of Health, Education & Welfare in the Eisenhower Administration and John Winant and Mary Dewson would become members of the Social Security Board.)

The Technical Board members were an additional 21 officials from the Federal agencies, but below the cabinet level. Staff was also hired to serve the three groups and the Executive Director. At its peak about 100 people worked on the staff.

The most important member of the Technical Board was Arthur J. Altmeyer who was the Chairman of the Technical Board. Altmeyer was an Assistant Secretary at the Department of Labor, and he would go on to become a member of the first Social Security Board and SSA’s first Commissioner.

Breakneck Pace

One of the most remarkable facets of the story of the CES is how little time it had to do its work. The CES was created in June 1934, Witte did report until the end of July, most of the staff did not start work until the end of August, and the CES was required to issue its report to the President in December 1934. Six months to create an American social insurance program! The CES spent a total of $145,000 and delivered its product only a few weeks late.

Altmeyer, Committee Counsel Thomas Eliot, Perkins and Witte met with President Roosevelt late in August to get his first-hand direction. Witte reported the meeting this way:

“He [the President] felt committed to both unemployment insurance and provisions for old age security and alwo wanted the committee to explore thoroughly the possibilities of a unified (package) social insurance system affording protection against all major personal hazards which lead to poverty and dependency. . .He also stated that all forms of social insurance must be self-supporting, without subsidies from general tax sources . . .[but] he understood that assistance from general tax revenues would have to be given to people already old and without means. . .he still held the view. . . that the only long-time solution of the problem of olad age security lies in a compulsory old age insurance system.”

In the light of the President’s directions, the CES adopted a statement of objectives at its August 13, 1934 meeting:

“The field of study to which the committee should devote its major attention is that of the protection of the individual against dependency and distress. This includes all forms of social insurance (accident insurance, health insurance, invalidity insurance, unemployment insurance, retirement annuities, survivors’ insurance, family endowment, and maternity benefits) . . .”

To organize its work, Witte and Altmeyer designated four working groups:

  • Unemployment Insurance
  • Public Employment and Relief
  • Medical Care
  • Old Age Security

It is clear that the CES intended to produce a complete system of social insurance, in the broadest possible meaning of the term. It was to include workers’ compensation, health insurance, disability insurance, unemployment compensation, old-age benefits, survivors’ benefits and various types of family and maternity benefits. This was to prove an illusive challenge. When the dust settled, health insurance, disability insurance and survivors’ benefits would be absent from the Administration’s proposal. They would eventually become part of Social Security, one almost immediately, one not for 20 years, and one not for another 30 years. And even those parts of the “unified package social insurance system” that made it into the CES proposal were not without controversy and the whole undertaking was never a sure thing.

A Full Text of the CES Is Available on the Web Site of the Social Security Administration

Editorial Note: The basic text of the original CES report to the President was 50 printed pages, with an Appendix containing a list of Committee members and 19 additional tables of data. The full work of the CES was contained in 10 large volumes of reports and studies, which were never published. In 1937, two years after passage of the Social Security Act, the new Social Security Board published a summary of all 10 volumes of the Committee’s work. This book, “Social Security In America,” published in 1937, contains the Appendix and Tables from the original CES report, and a great deal more besides. The basic report itself, however, was not reprinted. In 1985 a small 50th anniversary commemorative edition of the CES report was privately published by the National Conference on Social Welfare. Their book, entitled “50th Anniversary Edition: The Report of the Committee on Economic Security of 1935,” contains the text of the basic CES report, without the Appendix and Tables.

The full text of the original Report To The President of the Committee on Economic Security as it was transmitted to the President in January 1935 is available on the Web site of the United States Social Security Administration: http://www.ssa.gov/history/reports/ces.html

(Note: the Appendix with its supplemental tables is available as JPEG image files only.) This is a foundational historical document, the basis of the Social Security Act of 1935 and all the programs that it entailed.

Source: Social Security Administration: Historical Background and Development of Social Security: http://www.ssa.gov/history/reports/ces/cesbasic.html

How to Cite this Article (APA Format): The Committee on Economic Security (CES). (2015). Retrieved [date accessed] from /?p=8328.

 

One Response to Committee on Economic Security – 1934

  1. […] 1934, Roosevelt formed the Committee on Economic Security (CES). The committee, based on Roosevelt’s social-insurance idea, developed a plan that would allow […]

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