CHAPTER XXVIIThe ultimate success of a social security system will depend
to a large degree upon cost. As has previously been discussed at
length, a social security system is in the main a defensive program which occupies a subordinate position in maintaining and
developing the productivity of the nation, upon which rests true
social security. If excessive cost should reduce productivity and
lessen employment, the system will do more harm than good.
As the cost of a system increases, moreover, the danger becomes
greater that the costs will have to be met through inflationary
processes that tend to prevent the system from attaining the
desired objectives. The question of costs is not, therefore, one
to be left to a blind faith in the future. The interests of true
social security are not served by the individual who suggests to
the American people that when the danger of excessive costs is
mentioned they should ostrich-like bury their heads.Social security systems may be developed in either of two
ways or through a combination of them.
COSTS OF SOCIAL SECURITY AND RELIEF
|1. ||The more common way, as exemplified in the American
old-age and survivors insurance system, is at the outset to
include only those employees in the active service, and to pay
benefits only as those covered employees gradually, class by
class, reach the retirement age. Under this system, costs will
increase annually until the system reaches maturity or full load,
which will be sometime after the year 2000.|
|2. ||The less common way, to a considerable degree exemplified by the New Zealand system, is to begin at once to pay benefits to all members of the population who qualify for them. A
system entirely designed upon this principle would start under
approximately full load. The cost today would not be radically
different from the cost in 2000 except for the gradual changes
which may take place in the composition of the population and
adjustments that have to be made because of price changes
and other economic factors.|
Questia, a part of Gale, Cengage Learning. www.questia.com
Book title: Relief and Social Security.
Contributors: Lewis Meriam - Author.
Publisher: The Brookings Institution.
Place of publication: Washington, DC.
Publication year: 1946.
Page number: 658.
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