That Sound Is FDR Turning In His Grave

Sometime in late 1934 or early 1935, FDR’s cabinet, including heads of several major agencies, met to discuss how the new proposed Social Security program was to be funded. Some of the more liberal advisers wanted funding to come entirely from the employer. FDR argued for an equal division between employer and employee, the employee’s half to be taken out of paychecks. Why? As one of his advisers argued, such a payroll tax is intrinsically regressive. I think the world needs to know how FDR is said to have responded (actually to another complainant a few years later):

I guess you’re right on the economics. But those [payroll] taxes were never a problem of economics. They are political all the way through. We put those payroll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program.

And look what twelve members of Congress and one president, truly an Unholy 13, are about to do. I hope FDR rises from his grave and haunts them all for the rest of their days and nights.

(FDR quoted from Schlesinger, Arthur. The Coming of the New Deal. Boston: Houghton Mifflin, 1959. pp 308-309.)

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