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June 26, 1962 - Image 11

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Michigan Daily, 1962-06-26

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4

TUESDAY, JUNE 26,1962

THE MICHIGAN D A wLY

PAPV. I

TUESDAY, JUNE 26, 1962 THE MICHIGAN DAWLY

, A~'iv£ U 5 L£5AA .

Conference on Aging Supports
Personal Choice on Retirement

Retirement, a new pattern in
American life, should be left to
individual choice, but an adequate
income for the aged should be
provided.
These were two conclusions
reached at the 15th Annual Con-
ference on Oging held at the Uni-
versity last week. More than 500
persons from throughout the
United States participated in the
three-day conference viewing "Ag-
ing and the Economy."
At the closing session, a panel t
consisting of John Convery, con-,
sultant to the National Association!
ofManufacturers; Davir Living-
ston, president of District 65, Re-
tail, Wholesale and Department
Store Union; Ormond E. Loomis,
president of Senior Citizens Serv-
ices, Inc., and Prof. Ethel Shanas
of the University of Chicago so-
ciology department discussed "So-
cial Attitudes Retirement and the
Support of Older People."
Work Habit

ATTEND CONFERENCE -". Sen. Philip A. Hart (D-Mich) and
Prof. William Haber of the economics department were among the
speakers at the Conference on Aging held here last week.

Convery explained aged persons
often continue to work out of
habit. He said they should work if
they need to and can qualify for a
job. but they also must learn to
limit their purchases to what they
can afford.
Livingston opposed the view
that "older workers should get out
of the way and leave room for the
younger ones." He also said older
persons themselves should orga-
nize and set the level of income
they believe they should have.
Loomis presented the view that
retired persons can often contri-
bute to the community without
necessarily working for monetary
compensation.
Rising Costs
The major problem was how to
adjust to rising costs of living, he
said. "Some way should be found
for communities to help, such as
in medical problems, for when ill-
ness strikes a retired individual,
he can become indigent over
night."
Prof. Shanas said work should
not be overstressed, but the Unit-
ed States must find ways to finan-
cially aid elderly persons who don't
have enough to live on.
She also pointed out that per-
sons now middle aged will be bet-
ter equipped for retirement both
educationally and financially. The
problem immediate is to aid those
already employed.
David Views
Basic Flaws
Of Aid Plan
Flaws in the Social Security pro-
gram, the most important source
of income for retired persons, must
be readjusted to meet the needs of
the aged, Alvin M. David, assistant
director of the Federal Bureau of
Old-Age and Survivors Insurance
told the Conference on Aging last
week.
David explained 87 per cent of
those reaching 65 this year are
eligible for assistance under the
program and the percentage will
rise in the future.
Maximum Amount
However, the maximum amount
of earning that is taxable for So-
cial Security purposes and that
can be used for figuring the earn-
ings on which benefit amounts are
based must be adjusted as wage
levels. Otherwise more persons will
earn above the maximum and few-
er will get the benefits related to
their full earnings, he said.
Retirement itself brings little let
up in personal budget requirements
Helen H. Lamale of the United
States Department of Labor told
the Conference.
Couples with the husband aged
65 or over need 94 per cent as
much as couples with the man
aged 55 to 65 to maintain an equiv-
alent level of living, she said.
Budget Needs
"It is important to recognize
that the budgetaryrequirements of
retired persons as a group are con-
stantly changing-not because the
prices of goods and services
change, but because the composi-
tion of the group itself changes,"
she said.
Retirement resources and the
capacity of the economy to meet
their budget needs will change
and aid programs would have to
be adjusted accordingly, Miss La-
male added.

Speakers See Relation
Of Economy, Pensions

Relationships between the prob-
lem of financing America's aged
and the future of the nation's
economy were explored by The
Rev. Paul P. Harbrecht, S.J., of
Georgetown University and Charles
R. Sligh, executive vice-president
of the National Association of
Manufacturers.
"If it is a growing economy, it
can- support its elderly in better
style. If it does not grow, the pros-
pects of the aged in our country
are dubious," Sligh said.
Sligh urged that the country
avoid putting excess burden on its
economy by increasing taxes to
support a large public assistance
program. Because Federal funds
are not unlimited and are already
"severely strained," he advocated
selective aid to retired persons by
Federal governmental agencies.
Most older people are not with-
out resources of their own, or are
eligible for assistance from non-
Federal sources, he noted.
Sligh also endorsed private so-
lutions to the problem which were
"based upon investment for future
consumption and these are self-
supporting and perpetuating," in-
stead of expanded Social Security
benefits that are paid out of taxes
collected from men and women
who are currently earning.
He warned that the danger of
the Federal approach is that "it
merely redistributes the income of
current earners to non-earners,
and this can continue only so long
as the earners allow it. They will
not allow it so long as the earners
allow it. They will not allow it so
long if they become aware that
their earnings are being redistrib-
uted to persons who may be better
off than themselves."
Fr. Harbrecht had a warning to
issue concerning private programs.
Pension funds, along with other
large financial institutions like the
mutual funds, life insurance com-
panies and personal trusts are
buying control of the industrial
corporations of America.
"About 75 per cent of our pro-
ductive property is owned by large
corporations, which in turn are
coming to be owned by financial
institutions like the p e n s i o n
funds," he explained. If the trend
continues, it is quite possible that
DOMI NICK'S
PIZZAS-SUBS
812 Monroe
WE DELIVER
NO 2-5414

the pension funds will own a good
deal more than the 10 per cent of
all outstandingcorporate shares
they now control.
Discussing other aspects of pen-
sion funds, Fr. Harbrecht said
while the position of older persons
is improved by the pension system,
there is no clear or sufficient pro-
tection for the employe regarding
misuse of funds by the employer
or of termination of the pension
fund if the business fails.
Retirement,'
Jobless Rate
Ratio Viewed
The interrelation of unemploy-
ment, lack of job skills and retire-
ment was explored at the Confer-
ence on Aging by Seymour L.
Wolfbein, deputy assistant secre-
tary of labor and Prof. Margaret
S. Gordon, associate director of the
Institute of Industrial Relations
at the University of California.
Wolfbein explained that com-
mon denominator among Ameri-
ca's unemployed is lack of skills.
He outlined a program of job
training to aid untrained, unem-
ployed persons.
Prof. Gordon explained unem-
ployment will intensify pressure
on industry to compel early re-
tirement of older persons. If the
unemployment r a t e decreases,
however, the outlook for older
workers will be improved, she said.
Although some older workers
will continue to be displaced by
automation and other changes in
the economy, under improved con-
ditions older workers would have
fewer employment problems than
younger persons who had not com-
pleted "some program of higher
education of specialized training."
If unemployment rates continue
to rise, she explained, older work-
ers will continue to have problems
and are likely to fail to, qualify for
some of the retraining programs.

Haber Cites
Weaknesses
Of Pensions
The weaknesses of private pen-
sion plans were described to the
Conference on Aging by Prof. Wil-
liam Haber of the economics de-
partment last week.
Haber noted that "it is almost
universally required that a worker
remain with the same employer for
he loses his rights if he quits."
He indicated that the danger to
mobility of workers said to be in-
herent in private pension plans is
greatly exaggerated. More impor-
tant in lessening mobility are the
age of workers, since older workers
will not take the risks of seeking
new jobs, and the possible loss of
union seniority.
Valuable Asset
"A wage earner with 15 or 20
years seniorityrhas a valuable eco-
nomic asset he is strongly disci-
plined to gamble away by moving
to a new occupation or to another
city," Prof. Haber said.
Prof. Haber countered claims
that public and private pension
plans interfere with or discourage
individual thrift. Rather, he main-
tained, the very existence of such
plans has actually led to an in-
crease in private saving to supple-
ment that income.
He noted that a new develop-
ment of "guarantee provisions" are
slowly being introduced and "the
most forward movement in in-
creasing the economic importance
of pension plans would be a rapid
expansion in vested pensions at
age 40 after 10 years of employ-
ment."
Reduce Danger
This would reduce the danger
of pension plans inhibiting occu-
pational and geographic mobility
of wage earners and would allow
a retired person to be eligible to
receive a benefit from more than
one fund, thus increasing his to-
tal income.
Prof. Haber maintained that the
claims by some persons that trus-
tees of pension funds may deliber-
ately manage the investment of
large sufs in order to gain control
of important corporations were
"exaggerated."
While this could be done, "there
is not evidence whatsoever that
either bank trustees or pension
funds are seeking such control."
Rather, bankers and trustees
seek to invest reserves in industry
where the best returns can be had
and if they appear to concentrate
on 200 or more common stocks it
is because these stocks appear to
have a good profit potential.
Prof. Haber explained that the
trend toward a collectivized econ-
omic system has been operating
for some time, but so long as a
maximum degree of economic
freedom is preserved and the
standards of democratic society
are not hampered, "we need not
fear the fact that our institutions
are changing."
Morrison Sets
NASA Position
Prof. Richard B. Morrison of the
aeronautical engineering depart-
ment has accepted a position in
the National Aeronautics and
Space Administration.
He takes over the directorship
of launch vehicle and propulsion
programs in the Office of Space
Sciences.

AGED AND ECONOMY:
Jaffee, Siner Outline
SPlans To Raise Funds

The United States economy does
not "need" the labors of older per-
sons, but at the same time the na-
tion's economy can support addi-
tional expenditures for the elderly
and steps should be taken to see
that this is done, two speakers at
the Conference on the Aging said
here last week.
A. J. Jaffee, director of the man-
power and population program,
Bureau of Applied Social Research
at Columbia, said if the amount of
labor offered by those under 65 is
fully with an annual increase of
three per cent in productivity per
worker per hour, it can provide an
average annual increase in per
capita goods and services of close
to three per cent.
Jaffee explained that the econ-
omy will not grow any more rapid-
ly than that rate. However, if the
economy is going at top speed util-
izing the labor of those under 65,
"we can support properly the older
population."
He emphasized that the Old Age
and Survivors Insurance is an in-
surance program "to which we are
all paying premiums, and the more
rapidly the economy grows, the
more dividends will result from
these premiums."
Herbert E. Striner of the Stan-
ford Research Institute agreed
the elderly could be supported ade-
quately, and said it would require
about $1,500 more per recipient of
Old Age and Survivors Insurance
or about $24 billion annually.
To raise this money he sug-
gested these means:
1) Changes in the OASI tax;
Desire Failds
From State,
Not Children
The concept that children should
look to the welfare of their elderly
parents has hit a new snag - the
life span has been increased to a
point where substantial numbers
of the "children" are themselves
past retirement age.
Speaking to the Conference on
Aging, Donald P. Kent, director of
the Special Staff on Aging of the
United S t a t e s Department of
Health, Education and Welfare,
noted that elderly parents are
seeking independence from their
children, especially financially.
Older persons are themselves
looking more and more to gov-
ernmental channels if their in-
comes need to be supplemented.
As the situation stands at the
present, financing for older ner-
sons is a "vast jumble," Kent ex-
plained. Most important, huge
gaps exist and nobody is paying
the bill. Consequently, needs are
not being met.
In conclusion, Kent explained,
"I am quite sure that the ulti-
mate solution to the financing
problem will come about through
some rational combination of
Federal, state municipal and pri-
vate funds, perhaps allocating ac-
cording to a flexible formula which
permits variations to meet local
situations."

2) Upward changes in the OASI
taxable base now set at $4,800;
3) The use of general govern-
ment revenue instruments to aug-
ment OASI funds, such as taxes
and deficit financing,
4) Or, by increasing "permitted
earning" beyond the present levels.
An increase in the OASI tax to
six per cent participation by both
employe and employer would do
much to raise additional money,
he also suggested.
Name Norman
To U.S* Post
Prof. A. Geoffrey Norman of the
botany department, and director
of the Botanical Gardens, has been
appointed by Secretary of Agri-
culture Orville Freeman to the
agriculture department's new
Committee on Agriculture Science.
Its main function will be to eval-
uate and improve research pro-
grams within the department.

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