Published online by Cambridge University Press: 11 May 2010
Between 1900 and 1940, organized industry and the federal government, acting in conjunction with the states, created an American social welfare system. The two major participants in this process evolved along similar lines during this period. Both began as simple organizations and developed into complex, functional bureaucracies. At the beginning of the twentieth century, the federal government did not exist as a social welfare entity. Private corporations, the first to face the administrative and economic problems posed by the development of national markets, created social welfare systems for their employees long before the New Deal. Until the depression, these efforts enjoyed clear supremacy. By the end of the 1930s, however, a distinctly “public” social welfare bureaucracy and program had been developed on the federal level. Corporations and the state underwent similar changes but at different times, and the difference in timing influenced their relations. This essay describes the growth of these public and private bureaucracies and identifies their similarities and differences during the early twentieth century.
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39 One proposal called for an annual benefit computed as follows: 40% of the first $600 of average annual wages, 20% of the next $600, 10% of the next $600, 5% of the next $1200, plus an increment of 1% for employment over 5 years and half benefits for wives and children. See “Specifications for Plan AC-13” and other material in Record Group 47, Records of the Executive Director of the Social Security Board, 0–25, Box 138, National Archives. I. S. Falk, M. Sakman, B. S. Sanders, and L. S. Reed, “Permanent Total Disability (Invalidity) Insurance: A Memorandum Prepared for the Consideration of the Advisory Council on Social Security, December 9, 1938,” Department of Health, Education, and Welfare Archives, H.E.W. Library, Washington, D.C.
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45 This discussion and all quotations come from “Minutes of Advisory Council Meetings,” Record Group 47, Records of the Executive Director of the Social Security Board, 0–25, Box 138, National Archives.
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