receives a pension must not have been convicted of drunkenness during the last two years, three times or oftener. In New Zealand a pension is not granted to one except when his income is not more than £60 per year, or when his entire property is not worth more than £260. In New South Wales the income must not exceed £25, nor the property more than £390. In Victoria it is estimated that the average weekly income, during the last six months, should not exceed 10 s., and the property of the applicant must be under £160. The law of Victoria prescribes that the nearest relatives of the applicant must be incapable of caring for the applicant. He himself must have sought labor to support himself and his family. These requirements are not found in the laws of New Zealand and New South Wales. Since the organization of the Australasian Federation, the parliament of 1905 appointed a commission to study the problem, and already propositions for an old-age pension law, covering all the states of the Federation, have been considered. It is claimed that insurance companies are not at all affected by the old-age pension law, and it is evident that the spirit of self-help, self-support, and thrift has not been weakened. The people of Australasia are quite in advance of the people of the mother country in savings. Only recently have the states begun to pension their civil servants. The managers of great industries have furthermore introduced pensions similar to those in Great Britain and the United States. The states of Australasia have developed public insurance agencies to reduce the cost of life insurance, and private companies, like our industrial insurance societies, carry on an extensive business. Accident insurance. The legislation of New Zealand and other states has followed the development of English law. In the year 1854, the cruel earlier law of liability, which denied relief to the family of a workman killed by accident, was modified, and a form of the Lord Campbell legislation was introduced. The English employers' liability law of 1880 was followed by New Zealand in 1882. This act gave to the injured workman, in relation to his employer, the same rights for indemnity which any other person would have in respect to the person who injures him; but this law worked so badly that it was found desirable, after 1897, to introduce the workmen's compensation act, according to the example of the mother country. The amount which can be collected under the liability law has always been limited in Australasia, as in Great Britain, to conform to the income of the workman injured. The Compensation Act of England was introduced into the Australasian states after 1897, but it is limited to certain occupations, while the employer's liability law, still remaining valid, covers all kinds of occupations. In New Zealand the employers are left entirely free to choose any method of insurance. Since, naturally, many employers feel the need of liability insurance or of a collective workmen's insurance, there is a considerable demand for private insurance, and state supervision of these undertakings is required. New Zealand enacted a law, October 2, 1902, but other states have not imitated the example, nor have other Australasian states followed the example of New Zealand, which in 1900 established in its state insurance department a division for accident and liability insurance, chiefly to afford the managers cheaper premiums for insurance. The policies of the state insurance department cover the liability of the manager in relation to his workmen, up to the amount of £500 for each workman. Premiums are graduated according to the wages, and vary from 6 s., for £100 wages up to 65 s., in the case of dangerous occupations. In 1905 the premiums of the state department amounted to £23,970, and indemnities to £11,242. Sickness insurance.-It has been honestly feared by many opponents of state care of old-age pensions that the voluntary organization of self-help and thrift would be diminished by dependence on the state. So far as the facts in respect to Australasia are concerned, this fear is not justified. The friendly societies, which are the most popular and useful form of insurance co-operation, have flourished in a remarkable degree in Australasia. The English colonists took with them their friendly society ideas, and developed them in the largest extent. In seven states, in the year 1906, there were 4,446 associations with 379,661 members. Each local society had on the average 85 members, and it is estimated that more than 30 per cent. of the entire population of Australasia shares the advantages of these friendly societies. When we consider that in Great Britain and Ireland the property of the friendly societies, per head of population, is only £5, 8 s., 10 d., and that it is £11, 15 s., I d., in Australia, and that the average savings, per head, in Great Britain and Ireland are £5, 7 s., 8 d., and in Australia £8, 19 S., II d., it would appear that the population of these "socialistic" states has developed a greater spirit of thrift and of self-help than is known in the mother country, which has long opposed any socialistic experiments. Naturally, these friendly societies, which were founded at first simply for mutual, charitable relief, have required constant improvement from actuarial criticism and from state legislation, but the associations have gradually taken scientific ground, and offer, with state supervision, a sound insurance. The trades unions have done some work in the field of insurance, but their principal purpose has been to improve wages and conditions of work people. CHAPTER I THE EXTENT AND NATURE OF THE DEMAND FOR A THE UNITED STATES I. The economic condition of wage-workers calls for insurance as a necessary part of their protection against dependence and suffering. While the statistical material for determining the number of persons requiring social insurance is not entirely satisfactory, it does enable us to make a fairly accurate estimate for our purpose. There is a common assumption in this country that the wages of workingmen are so high that social insurance is not desirable; that, with the ordinary private associations and insurance companies at hand, there is no demand for collective effort, with some measure of governmental intervention, stimulus, and regulation. It is not necessary to exaggerate poverty to prove the need of a social policy of insurance. This is demonstrated by the fact that it is precisely the men of the successful classes who realize the wisdom of distributing risks, and of providing a fund in case of incapacity for labor or of death by the method of insurance rather than by depending entirely on savings and investments. If the ordinary professional man should wait until his investments would provide for his needs in long illness or for his family in case of his death, during the first part of his career, the family would be practically within a few months of dependence on charity. On the other hand, no system of saving or of insurance can do much for the non-industrial classes, as idiots, insane, paupers of all categories, vagabonds, and criminals. Workingmen's insurance can help only workingmen-those who spend most of their lives earning a living 1 and who are paid wages or small salaries. For defectives and paupers industrial insurance is inapplicable, and these must be supported by public or private relief; while delinquents are placed under public control at compulsory labor in coercive institutions. People of wealth can easily protect themselves by investments or by insurance in private companies. If they pay too much for this benefit, their business training enables them to discover legal means of redress and correction. But the majority of wage-earners are not in like situation and require some form of collective action. In this connection we must determine as accurately as possible who should receive the advantages of a social policy of insurance. Various attempts have been made to estimate the average income necessary to prevent dependence on public relief and private charity. The average income will vary in purchasing power in different localities, and large sections of the population do not enjoy the average rate of earnings. In certain occupations the workers live in cities. where rent and food are unduly expensive, and yet their earnings are made low by competition among themselves, as in the needle industries in New York and Chicago. To speak of the average earnings in this connection is often misleading mockery. We may, however, give estimates of careful observers in relation to the margin of dependence on relief. Mr. P. Roberts says: "It was shown by the Bureau of Statistics of Massachusetts that it takes for a family of five persons $754 a year to live.” 1 This does not give the minimum standard of bare existence, but a reasonable standard of comfort and that only for certain areas in the state of Massachusetts. It would not apply to the negroes of South Carolina, where one of their families might regard an income of $400 a year as luxury. 1 Anthracite Coal Communities, p. 346. |