Moreover, it has been argued, social security was an import of foreigners – if not a foreign conspiracy – from Germany and even had a Marxist flaw. In addition, it is a threat to established funds in industry, union social funds and brotherly, mutual and commercial insurance, hence the argument. In 1889, Germany adopted compulsory old-age insurance, which also included disability insurance. Here, contributions were divided between employees, employers and governments. But to underline the disparate development, there was no unemployment insurance in Germany until 1927. Other countries that introduced old-age insurance were Luxembourg and Austria in 1906, France in 1910, Romania in 1912 and Sweden in 1913. The two main systems — German and French — were similar in their efforts to cover the working population, combine old-age and disability insurance, and subsidize premiums through employer contributions and a government supplement to each pension owed. Another facet that inhibited the movement toward Social Security or Social Security came from our pioneering tradition – the unusual emphasis on individual initiative and autonomy – the unprecedented accumulation of excess wealth. As long as large reserves of excess wealth could be channelled into social services, there was neither the demand nor the will to develop the institutions of public welfare. But at the beginning of this century, Social Security struggled with the idealization of deep-rooted voluntary institutions in the United States. Voluntary associations fulfilled the function of mediation between the individual and mass society and the government. I think it`s safe to say without too much dissent that the concept of Social Security in America really began in the 20th century — in a wage-centric industrial economy. Social security has been proposed as an alternative to the existing but inefficient system of economic assistance.
Regardless of the Poor Law, it would respond predictably and appropriately, according to its proponents, if a person were exposed to the long- and short-term risks that disrupted the income stream — accident, sickness and maternity, old age and disability, unemployment or death, leading to impoverished dependency. Thus, the Social Security movement sought to shift the function from the private sector to the public sector and provide a new definition of the role of government in American life. Frieda Wunderlich, The German Unemployment Insurance Act of 1927 , The Quarterly Journal of Economics, Volume 42, Issue 2, February 1928, Pages 278-306, doi.org/10.2307/1884049 With regard to unemployment insurance, Britain enacted such a law in 1911. Winston Churchill also played a key role in the introduction of unemployment insurance. Between 1919 and 1927, Italy, Luxembourg, Austria, Australia, the Irish Free State, Bulgaria, Poland, Germany and several Swiss cantons followed. Social security, it was argued, imposes an excessive burden on industry or the State, or both. This leads to demoralization, lack of foresight, destruction of the habit of saving and even deliberate malinlow. The latter applies in particular to unemployment and sickness, as they are easier to simulate than accidents at work, old age or widowhood.
In Germany, Bismarck took advantage of the self-help movement that was spreading there (among trade unions – friendly societies, some employers) and made acceptable the thesis that coercion was inevitable, that state control of social security was essential, and that public subsidies were desirable. The France did not enact a law on compulsory health insurance until 1930, but approved voluntary unemployment insurance in 1905. In the case of Germany and its Health Insurance Act, 2/3 of the contributions came from the employer and 1/3 from the employee. Isaac Max Rubinov was a prominent American social security theorist, if not THE most eminent one. He is the author of several remarkable books in this field. Social security proposals were thus seen not only in light of the needs they served, but also as a wedge in the process of expanding state power that would ultimately limit individual freedom. Social security: The evolution of social security in Europe, although little known, has influenced the thinking of those involved in social reforms in this country. What is significant is that there has been a disparate development in France, Germany and Britain.
This was also true elsewhere in Europe. It applied to mandatory or non-mandatory characters; differences in the categories of eligible workers; shares paid for by whom – employers, employees and government; regulations that varied from country to country; the amount of benefits and their impact.