By
CYNTHIA CROSSEN Staff Reporter of The Wall Street Journal
Updated Sept. 15, 2004 12:01 a.m. ET
Getting old is rarely regarded as a happy prospect, but before Social Security, aging in America often meant penury and sometimes even the poorhouse.
When America was a nation of farmers, men and women who no longer could do hard physical labor frequently lived with their children and contributed to the domestic economy by babysitting, tending the garden, sewing or cooking. By 1920, however, when more Americans lived in cities than on farms, old people faced a bleaker future. Urban homes were smaller, and wages paid the rent. Once people became too old to earn a salary, they were, however loved, an economic encumbrance.
"In the U.S.," a government adviser wrote in 1934, "many workers can escape the economic problems of old age only by dying before their period of superannuation sets in."
Ironically, while life expectancy was rising quickly, many employers shunned older workers. A 1930 survey found that almost a third of 224 American factories had maximum age limits for new employees. Four plants wouldn't hire anyone over the age of 40. In another 41 plants, the age limit was 45. The rest had no fixed limits, but they rarely hired people over the age of 50.
Retirement nest eggs, except among the wealthiest Americans, didn't exist. How could they? Even at the peak of the stock-market boom in 1929, the average annual income of all salaried employees was $1,475 -- the equivalent in purchasing power of about $16,000 today. Without health insurance, an aging person's savings could be quickly drained by medical bills.
A handful of people worked for paternalistic companies that would tolerate dead wood while a faithful employee coasted into retirement. And a few companies offered retirement annuities, though in the early decades of the 20th century, only about 2% of employees were covered. "Most private pensions existed not as a right, but a favor," wrote David Hackett Fischer in his 1977 book, "Growing Old in America." At most factories and offices, when older workers' productivity began to slip, they were simply dismissed.
State governments enacted old-age pension plans in the early 20th century, but they were mostly underfunded and undersubscribed. Some old people balked at the idea of "going on welfare." State plans also were vulnerable to regional interests: In Louisiana in 1937, old-age pensions were reduced in June and July so that elderly blacks would help to harvest cotton. In other agricultural areas, relief offices simply closed during the harvest season.
The Depression was a catastrophic blow to almost every American, but none more than the elderly. For many people, said Franklin Roosevelt in 1934, old age is "the most tragic of all hazards." Thousands of old people from across the country wrote to Washington asking for help. "I'm a 60-year-old widow greatly in need of medical aid, food and fuel," wrote a Virginia woman. "I pray that you would have pity on me."
Mrs. M.A. Zoller of Beaumont, Texas, begged for someone to help her 82-year-old mother, who, she wrote, was diabetic, "out of funds completely," and had "no place to go unless it be to the poorhouse."
And over the hill to the poorhouse many older people went. Financed by local taxes, poorhouses were the shelters for all of a region's indigent, and in the early 20th century, most counties had one. The best of the poorhouses provided a meager standard of living. The worst doubled as insane asylums and orphanages. "I was three miles from town but felt like I was 3,000 miles from friends and country," wrote Ed Sweeney in his 1927 memoir, "Poorhouse Sweeney." "I have ate off trays that looked like they had spent the rainy season laying on a city dump."
Germany, Sweden, France and England, among other countries, already had legislated publicly funded old-age insurance before Americans took up the debate. Proponents in the U.S. wondered why men and women who had been diligent, thrifty workers should suffer hunger and insecurity in their old age. In a letter to an editor, a postal worker pointed out that horses owned by the federal government lived out their old age on full rations. "For the purpose of drawing a pension," he declared, "it would have been better if I had been born a horse than a human being."
Opponents argued that sensible people would provide for themselves, and that universal old-age insurance would set the country on the slippery slope to socialism. Children, not the state, were obliged to care for the old, they said; without that responsibility, family ties would loosen. And if employees were guaranteed lifetime support, wouldn't they feel less incentive to work hard?
Even after the Social Security Act became law, it was vigorously challenged in America's courts.
"The hope behind this statute," wrote Justice Benjamin Cardozo for the bare 5-4 majority of the Supreme Court in 1937, "is to save men and women from the rigors of the poorhouse, as well as from the haunting fear that such a lot awaits them when journey's end is ne
ar."
