Transcript for the Piece Audio version of Life Before Social Security

HOST INTRO: Most of the discussion regarding Social Security has focused on how it might function decades from now. The shrinking ratio of workers to retirees is expected to have a dramatic effect on the system's finances. President Bush insists current workers will be better off if they invest in private Social Security accounts. And yet the system's origins are probably as murky for many people as its future. Producer Richard Paul takes a look at what financial conditions were actually like for retired people in the years before Social Security.
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In 1921, when Helen Borut (BORE it) was 10, she went through a jarring change of routine. Her grandmother came to live in her family’s tiny apartment in the Bronx.

[HELEN: We shared a room and she was always cold and we always had to keep the window close (laughs).]

The change in lifestyle was significant. But Helen, who’s 94 now, says it was pretty-much expected by kids at that time.

[HELEN: It was not unusual for the grandparents to live with their children or their
grandchildren. I mean it was a common thing.]

In the years before Social Security, Helen remembers, it was almost impossible to find older people living on their own.

[HELEN: I was Jewish but there were Greek families and the same thing. Italian families. It was the same thing]

In the case of her family, Helen’s grandmother had just left the house she her husband had rented since the turn of the century. Helen’s grandfather had just died in his 60s.

[HELEN: He had a grocery store. I think my grandfather worked until he died.

We take for granted today that someone will eventually reach “retirement age” and will then, in fact, retire. But not that long ago, the very concept of seniors living years of extended, enjoyable leisure was almost unheard of.

[HELEN: I don’t recall any people retiring. I think they just continued until they died.]

Helen’s recollections are born out by research and by references in the contemporary popular culture. Like this film from the days when seniors still mostly lived with their children. It was produced for civic groups by the human services organization that was then known as the National Social Work Council.

[MOVIE CLIP – “A Place To Live”
ANNOUNCER: Some are lucky. Through the continuing of their life's work they cross the line into old age with scarcely an interruption. But they are the few and the fortunate. Most, by far pass over the threshold of old age into a new world of which they are only dimly aware.]

Things we take for granted in old age today, like company pensions and investments were unheard of in the years just before the Great Depression. Alice Kessler-Harris is Chair of the history Department at Columbia University.

[KESSLER-HARRIS: Except for a handful of companies there was no such thing as an employee pension for most workers.]

[MOVIE CLIP – “A Place To Live”
ANNOUNCER: Old age is sitting on a bench and watching life hurrying by. Old age is a lonely meal behind a plate glass window]

Making ends meet was tough for working people back then. The average salary for a skilled worker in 1925 was about 23 dollars a week. That’s a little under 13-thousand dollars a year in today’s dollars. Many people borrowed. And, while the personal savings rate was significantly higher than it is today, Alice Kessler-Harris says that still didn’t amount to much.

[KESSLER-HARRIS: You’re lucky if you’re able to buy the tobacco that goes in your tobacco pouch. You may be able to handle living in a boarding house, but perhaps only with terrible difficulty.]

[MOVIE CLIP – “Better Housing News Flashes”
(music) ANNOUNCER: Nineteen-twenty eight was a good building year. Almost 3 billion dollars worth of new residential construction saw the light of day]

This theatrical short from the Federal Housing Administration points out that there were of course some seniors who’d been able, during their productive years to scrape together enough to buy a house.

[MOVIE CLIP – “Better Housing News Flashes”
(music) ANNOUNCER: This couple is going through a model house now. Suppose we follow them. The husband apparently isn't very keen about it all. But you know how wives are. So in they go to this delightful living room.]

But homeownership was far from common. About 45% of workers owned their homes in 1920. Compared with about 75% today. But break that down by class and you find …. among the poorer sectors of the working population, home ownership was closer to 25 percent.

[MOVIE CLIP – “Better Housing News Flashes”
(music) ANNOUNCER: They both would like to have this place for their very own. Too bad they can't afford it.]

For those with no home and no family, as this Federal government film from the early 40s suggests – the alternatives were dismal and few.

[MOVIE CLIP – “Your Social Security”
ANNOUNCER: When they reached old age, they found themselves lacking the means to meet even their barest needs. And so they were forced to become wards of public charity (music)]

The County Poor House was still quite common in the 1920s. There, seniors with no family were thrown in with other charity cases – orphans, unwed mothers and the mentally ill. For many older people at this time, life was, indeed nasty, brutish and short. The average life span for an adult male in the United States in the 1920s was 49 years. Allan Kraut is a history professor at American University in Washington, DC who specializes in the role of disease in public policy.

[KRAUT: There were of course toxic poisonings. Noxious fumes. So there were any number of things that could injure you, make you sick, shorten your work career and perhaps even shorten your life.]

There is, of course a popular mythology about what happened next.

[MOVIE CLIP – “Your Social Security”
ANNOUNCER: Something had to be done. Something was done! In 1935 Franklin D. Roosevelt put his signature on the Social Security Act.]

Over the years the story has come to be told that this hardship was impetus behind President Roosevelt’s push for Social Security. Actually, the push began about 15 years earlier. There was a movement in the 1920s to reduce the 8-hour work day to six …. to free up space for the unemployed. But this was pitted against another movement that said: Keep the 8-hour day, but force people to retire at age 65. This debate continued and was responsible for the creation of the first widespread company pensions. And it gained steam as unemployment skyrocketed during the Depression.

[MOVIE CLIP –FDR Signing the Social Security Act
FDR: Today, a hope of many years’ standing is in large part fulfilled.]

On August 14, 1935, when Roosevelt signed the Social Security Act, Columbia University historian Alice Kessler-Harris and others say that the first thing on his mind was NOT helping the elderly, but solving the problem of unemployment while simultaneously giving old people money so they could prop up the economy.

[KESSLER-HARRIS: If you pushed people out of the labor force without providing them with an income, those people would simply be drags on the economy. But if they had some form of income which they would spend then they could continue to participate in the consumption society and keep the economy going.]

[FDR: The civilization of the past hundred years, with its starling industrial changes has tended to make life more and more insecure.]

Whatever its intended consequences, the passage of Social Security brought about mandatory retirement at a reasonable age and, for the first time gave seniors full knowledge of where their next dollar was coming from. This resulted in the largely unintended consequences of freeing up money for travel, homeownership, and continuing education. Ironically the increased life spans that were made possible to-some-extent by Social Security have contributed to the programs long-term financial problems. But there’s no question that the institution of Social Security created a level of prosperity and leisure that people like Helen Borut’s (BORE it) grandmother could not have imagined in their wildest dreams. I’m Richard Paul in Washington.

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