PUBLIC WELFARE AND SOCIAL INSURANCE
Public welfare services of today grew out of the old Poor Law; social insurance is a departure from the poor law and represents an adjustment to the vicissitudes of modern capitalism. Historically the poor law was a practical device for maintaining the physical existence of the economically unfortunate while causing the least pain to the taxpayer. There was not until recently any idea that the public social services could be preventive or constructive. On the contrary, it was hoped that by the provision of as little assistance as possible the "lazy loafers" would be forced to go back to work! It was the experimenting of the private social agencies with reasonably adequate material aid accompanied by case-work services that within the last two decades awakened the public to the possibility of constructive welfare services administered by government. Great Britain took the first long step toward adequacy in relief grants when it provided for "out-of-work donations," "uncovenanted benefits," and "transitional benefits" after the World War for persons ineligible for unemployment insurance benefits --albeit these payments were made from the Unemployment Insurance Fund. The principle involved was finally incorporated into the Unemployment Assistance Act of 1934 and became a permanent part of the British public welfare services. It did not become a national policy in this country until the passage of the Federal Emergency Relief Act in 1933.
But the idea that the economic system is shot through with unavoidable hazards for the working population was first recognized by government with the enactment of the early social insurance laws. Ironical as it may seem, credit for this advance in social legislation goes to the imperial German government. It was on May 8, 1881, that Bismarck, as chancellor of the German Empire, sent the first social insurance bill to a national legislative body. Along