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White House - Congressional Leadership Meeting, 6/4/69 (includes minutes and Ford notes)
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1550979
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White House - Congressional Leadership Meeting, 6/4/69 (includes minutes and Ford notes)
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Robert T. Hartmann Papers
House of Representatives Subject Files
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Suffrage
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Unemployment
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1969
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No Ford. - Dirksen
Press Conference
GERALD LIBRARY FORD
These documents were scanned from Box 106 of the Robert T. Hartmann Papers at the Gerald R. Ford Presidential Library.
REPUBLICAN LEADERSHIP MEETING
JUNE 4 -- 8:30 a.m.
AGENDA
much like
8:30 - 8:50 a.m.
I. Insurance not H.R.828
Unemployment Message
Thursday of Fundy (message) no substantative
8:50 - 9:20 a.m.
II. Surtax Prospects
Schedule - There / Times.
plus since 1960.
9:20 - 9:45 a.m.
III. Hill-Burton Amendments
Coverage - 4,8 million
Small employers
Large from
agri processing
FORD is LIBRARY GERALD
sills & delivery personnel.
non. profit institutions
state instituting
Retrawing
Protecting The System 1 -1). menewood weeks Temployment
2) n.y. ot RI stake
3) Extended benefits in digreasion
r receivion
treyghing financing
Wage Base - eventually ino,
Federal Standards - benefit levels. (aphorts states to net)
44 states 1 2 of pay, shept
dollar mapimum
Hope states Lan do - within 2 yrs by
DIARY OF WHITE HOUSE LEADERSHIP
MEETINGS -- 91st CONGRESS
June 4, 1969
In the President's absence (Midway trip), the VP pre-
sided. Shultz reported on the Unemployment Insurance
Message and the draft of the bill. It will be philosophi-
cally different from H.R. 8282, which provoked BO much
controversy in the last Congress. An effort has been
made to maintain the traditional federal-state partnership
relationship. He explained the bill in six parts:
1) Coverage -- extend to 4. 8 million, including 1.6
million firms with less than 4 employees; 400, 000
larger farms which employ 4 in each of 20 weeks;
200, 000 employees engaged in agricultural processing;
200, 000 salesmen, deliverymen, etc. ; 1.8 million
employees of non-profit organizations; 600, 000 employees
of state hospitals and universities. Other state employees
are not covered, but the message contains a strong
exhortation for state action. The VP inquired how much
this would cost the states. No reply. The VP said that
in his opinion all state employees or none should be
covered (in order to avoid state administrative problems).
2) Retraining -- unemployment benefits must not be
denied by states simply because the unemployed workers
are involved in retraining. This is designed to encourage
the technologically unemployed to acquire new skills and
become self-supporting.
3) Protecting the system -- two provisions are designed
to protect the solvency of the system: first, minimum
work required for eligibility must be at least 15 weeks;
second, unemployment payments will not be allowed to
strikers as they are in New York and Rhode Island.
4) Extending duration of benefits -- rather than depending
upon special action during times of emergency, a formula
GERALD LIBRARY 4. FORD
2
will be written into the basic law which will automatically
trigger an extension of benefits. Whenever the rate of
insured unemployed (now 2. 2%) rises above 4. 5% for a
period of 3 months, the benefits will be extended for up
to 50% of the original entitlement. The extension would
"trigger out" whenever the rate falls below 4. 5% and
the number of unemployed who have exhausted their
benefits falls below 1% of those covered.
5) The federal taxable wage base is increased to $6,000
over a 4-year period (at a rate of O. 4%).
6) Benefit levels -- the bill contains nothing requiring
federal standards. However, the message contains some
black jack language which hints that unless the states
have enacted legislation within 2 years authoriting bene-
fits of at least 50% of former pay, the Federal government
will write federal standards.
The VP announced that the message would be available for
leadership inspection at noon on Thursday and would come
to the House on Friday.
Byrnes reported that Ways and Means would begin considera-
tion of the surtax tomorrow and plan to vote Tuesday. He
feels there are enough votes (including 4 or 5 Democrats) to
report the bill from the Committee, but it is necessary for
the Administration to develop a sense of public urgency.
Dirksen was asked about prospects in the Senate. His reply:
'We are in no hurry.' Hit Byrnes reminded him that June 30
is the deadline. Prior to that time, the legislation can be
characterized as a "phase out" of the surtax. Later, it will
be called the "imposition of a new Tax" (that is, reimposition
of an old tax that has expired). The earliest the bill could
reach the House would be June 17 or 18. Some in the House
will demand an open rule. The VP asked if this does not mean
that it is almost impossible to conclude action before the dead-
line. Ford said that last year 114 out of 187 voted against the
FORD is LIURARY GERALD
3
measure. This year, a Whip check shows 79 for
extension; 50 against; 30 undecided; 30 absent. We
must have 120 Republican votes and 80 or 90 Democratic
votes. Byrnes said that the IRS withholding tables must
be in the hands of the printer by next Tuesday and no one
knows whether those tables should be based upon the tax
liability including a surtax or excluding a surtax. Rhodes
suggested that a rider could be attached to the Supple-
mental Appropriation bill now pending in the Senate to
extend the obligation of withholding as though the surtax
had been extended without actually extending the surtax.
Kennedy said that the printing problem was a procedural
problem but the major problem was the impact diaction
would have abroad. International financiers will assume
that the Congress has rejected the Nixon anti-inflation
fight, and this will damage the dollar irreparably.
Williams said that it is physically impossible to pass the
surtax extension and therefore it is prudent to make interim
plans. The VP said that we must bring to bear upon the
Congress a crash publicity program. Kennedy said that
Treasury has concentrated on the House Committee and
perhaps neglected the Senate. Morton advocated interim
action to approve tax tables, including the surtax. Arends
believes it is possible to get between 115 and 125 Republican
votes for surtax extension. Ford asked if it is procedurally
possible to attach a rider extending current withholding tables
to the Supplemental Appropriation bill. Dirksen replied that
the Chairman of the Appropriations Committee would have to
move to suspend the rules to do so and that this would require
a 2/3 vote. Rhodes suggested the need of a bipartisan leader-
ship meeting.
Mayo warned that a new tactic is being developed in the
Senate which would reduce the House-imposed spending
limitation from $192. 9 billion to $187. 9 billion (exempting
uncontrollables). This would create a surplus without the
need of a surtax. Unrealistic as this may be, Members of
the Senate will make the effort. Harlow said that he will see
4
the President in California and advise him to call
Mansfield, McCormack, Mills and Long and then
hold a bipartisan leadership meeting on Wednesday
after he returns next Tuesday. Dirksen gave it as his
opinion that the tax tables could be extended without
extending the tax itshif.
Dr. Burns expressed his most grame concern about the
failure to extend the surtax. He predicted it will result
in the need for new monetary controls which will force
the interest rate higher and that this will confront the
nation with the potential of a "financial panic. I must
say thathhis words, his tone and his general manner
alarmed me more than anything I have witnessed in this
area. Ford said that a Republican Conference in the
House next week will discuss the urgency of the action.
At this point, the VP suggested that it might be wise to
explore the possibility of deferring the Unemployment
Compensation message. If that message comes down in
connection with the crisis about the surtax, our political
enemies will say that we have lost control of the fiscal
machinery; that we recognize that we have done SO; and
that we are gearing up for the depression. Kennedy said
that it is important not only to take interim action on the
tax tables but at the same time to make a massive effort
to get the surtax estension bill passed.
The VP started to take up the question of Hill-Burton
amendments. I interrupted him toexplain that Mr. McCulloch
and I were obliged to leave to attend an executive session of
the House Judiciary Subcommittee hearings on conglomerates;
that the Attorney General is confronted with the need to make
a decision about the voting rights legislation before he testi-
fies tomorrow morning: and that it would be helpful if it sould
be taken out of turn. The VP agreed and the Attorney Genefal
explained the new complexion which the Supreme Court decision
in the Gaston County case puts upon the voting rights question.
5
He said that the decision reaches the 15th Amendment,
and as a practical consequence, literacy tests are
invalidated nationwide. The Gaston County decision
held that minority groups, having been denied equal
educational opportunities, suffer an unfair disadvantage
in their attempts to register if a literacy test is applied.
Since northern states which have literacy tests also have
a large population of minority groups which have suffered
educational inequality in southern states where they formerly
lived, northern literacy tests will fall on a case-by-case
basis. Therefore, he suggested that the Administration
should ask for a statutory abolition of the literacy tests
nationwide. This he suggested would fulfill the pledge
made by the President during the campaign to extend the
application of the Act universally.
Dirksen said that the President needinot pronounce on the
subject at all but simply take the position that the Supreme
Court had repealed literacy tests and thereby malle the
Act universally applicable. Mr. McCulloch recommended
that the Administration ask for a simply 3 to 5 year
extension of the Act and treat any reforms in voting frauds
in a separate bill. The discussion which followed included
comments by Rhodes, Scott, Taft and Hruska. There seemed
to be some confusion about who stood where. It was finally
suggested that Mr. McCulloch be asked to seek another post-
ponement of the Attorney General's appearance in order to
give the Justice Department a better opportunity to study
the impact of the Gaston County case.
At that point, Mr. McCulloch and I had to leave, and I was
not witness to the discussion concerning the Hill-Burton
amendments.
RICHARD H. POFF
No Meeting Scheduled for June3
Original to GRF with 6 Copies
HOUSE ACTION, PERIOD MAY 27 THROUGH JUNE 2, 1969
Tuesday, May 27, 1969
AGRICULTURE APPROPRIATIONS Continuation
The House passed by record vote of 321 yeas to 50 nays, H.R. 11612,
to make appropriations for fiscal year 1970.
Prior to passage, the House adopted by a record vote of 224 yeas
to 142 nays, the Conte Amendment, limiting subsidy payments to
$20,000 a year.
The House rejected by teller vote of 66 yeas to 91 nays, an
amendment to withhold funds for any programs wherein there
was non-compliance with title VI of the 1964 Civil Rights Act.
TREASURY - POST OFFICE APPROPRIATIONS
Prior to consideration of H.R. 11582, the House adopted by a record
vote of 344 yeas to 12 nays, H.Res.424, waiving points of order
against section 502 of H.R. 11582.
The House by a record vote of 325 yeas to 6 nays, passed H.R. 11582,
making appropriations for the Treasury and Post Office Departments,
the Executive Office of the President, and certain independent
agencies, for the fiscal year ending June 30, 1970.
SMITH OF IOWA AMENDMENT - A separate vote was demanded by Steed
of Oklahoma on the Smith of Iowa Amendment, limiting subsidies
to any distributor of second class mail to $20,000, and on a
record vote the amendment was defeated by 99 yeas to 239 nays,
after it had been agreed to earlier in the House by a division
vote of 40 yeas to 24 nays.
Prior to passage, the House rejected by voice vote recommittal
motion.
Wednesday, May 28, 1969
By voice vote, the House passed H.R. 4204, to amend the War Claims Act
of 1948 to include prisoners of war captured during the Vietnam
conflict.
The House passed by voice vote, H.Res.425, to provide for transfer of
funds within the offices of the Clerk and the Sergeant at Arms of the
House of Representatives.
GERALD
- 2 -
Monday, June 2, 1969
The Consent Calendar was called. There were eight suspensions:
1. H.R.763 - To provide for a study of State laws governing the
operation of youth camps, was defeated by a roll call vote
of 151 yeas to 152 nays.
2. H.R.2667 - To revise the pay structure of the police force of
the National Zoological Park, was passed by voice vote.
3. H.R.692 - To extend the length of time community nursing
home care may be provided for veterans, was passed by
voice vote.
4. H.R.693 - To provide that veterans 70 years of age shall
be deemed unable to defray hospital expenses, was passed
by roll call vote of 302 yeas to 3 nays.
5. H.R.2768 - To eliminate the six-month limitation on the
furnishing of nursing home care for service-connected
veterans, was passed by voice vote.
6. H.R.3130 - To provide that the Administrator of Veterans
Affairs may furnish certain medical services, was passed
by voice vote.
7. H.R.9334 - To promote the care and treatment of veterans in
State veterans' homes, was passed by voice vote.
8. H.R.9634 - To improve the Veterans' Administration program
of sharing specialized medical resources, was passed by
voice vote.
MONARY
Tuesday and Balance of Week
H.R.10946 - To promote health and safety in the building trades and
construction industry.
H.R.11102 - Medical Facilities Construction and Modernization Amend-
ments of 1969.
FOR RELEASE AT 12:00 NOON, EDT
July 8, 1969
Office of the White House Press Secretary
THE WHITE HOUSE
TO THE CONGRESS OF THE UNITED STATES:
The best time to strengthen our unemployment insurance system is
during a period of relatively full employment.
The Secretary of Labor is sending to the Congress today proposed
legislation to extend unemployment insurance to 4, 800, 000 workers not
now covered; to end the shortsighted restrictions that stand in the way
of needed retraining efforts; and to add a Federal program automatically
extending the duration of benefits in periods of high unemployment.
There are three principles to be considered as we move to make the
unemployment insurance system responsive to our times.
Unemployment insurance is an earned benefit. When a man covered
by unemployment insurance is working, the employer pays a tax
on his wages to insure against the day when the employee may be between
jobs. That insurance is like a mandatory fringe benefit; it is insurance
bought in the employee's behalf, and the worker therefore is entitled to
the benefits he receives when he is unemployed. Accordingly, there is
no demeaning of human dignity, no feeling of being "on the dole, If when the
insured worker receives benefits due.
Unemployment insurance is one of the foremost examples of creative
Federal-State partnership. Although the system was created by Federal
law, most decisions about the nature of the program are left to the States,
which administer the system with State employees. This makes the system
far more flexible and attuned to local needs and special circumstances of
local economies.
Unemployment insurance is an economic stabilizer. If, for example
the economy were ever to slow and unemployment were to rise, this
program automatically would act to sustain personal income. This would
help prevent a downturn from gathering momentum resulting from declines
in purchasing power. When employment is at a high level, and greater
stimulation of consumer demand is unwanted, relatively little money flows
into the economy from unemployment insurance.
With these principles in mind, I am making these recommendations
for both Federal and State action:
1. We should act together to extend unemployment protection to more
FORD
employees, including many highly vulnerable to layoffs who are not now
covered.
2. The States should make certain that workers throughout the United
States receive enough money for a long enough period of time to sustain
them while they seek new jobs.
3. We should end the restrictions imposed by almost half the States
on payments to unemployed workers undergoing retraining and, instead,
follow the lead of those States which encourage retraining.
more
2.
4. We should better protect the investment made on behalf of the
insured by seeing to it that the funds are paid only to those who should
receive them.
5. We should increase the responsiveness of the system to major
changes in national economic conditions.
6. We should strengthen the financing of the system which
presently discriminates against the low-wage worker and the steady
employer.
1. Protecting More Employees
Over 57 million workers are protected by unemployment insurance.
However, almost 17 million are not covered: more than half of these
are employees of State and local governments. The last extension of
coverage was enacted during the Eisenhower Administration, when
6 million additional workers were included; there is a clear social need
today to cover as many more employees as we can.
I propose that an additional 4.8 million workers be covered by
unemployment insurance. These include:
-- 1, 600, 000 workers in small firms with less than four employees;
-- 400, 000 on large farms employing four or more workers in each
of 20 weeks;
-- 200, 000 in agricultural processing activities;
-- 1,800,000 in non-profit organizations;
600, 000 in State hospitals and universities;
-- 200, 000 salesmen, delivery tradesmen, and others who are
not currently defined as employees.
These 4, 800, 000 workers are in real need of protection against
unemployment. Many of them are low wage workers with little job
security and no prospect of termination pay if they are laid off.
The present gaps in coverage work a disproportionate hardship on
minority workers, since a higher percentage of the 4, 800, 000 are nonwhite,
compared to the entire labor force.
To cushion the immediate impact of this extension on employers, I
recommend that States be permitted to lower the tax rates on newly
covered employers until such time as a record of employment experience
can be compiled to determine what their true rate should be.
With the passage of this legislation, the majority of those remaining
uncovered will be employees of State and local governments. I urge the
States and localities to take action, in the light of their local circumstances,
to include their own employees in unemployment insurance coverage.
FORD LIBRARY
more
3
2.
Making Benefits Adequate
The basic purpose of the Unemployment Insurance Program is to pay
weekly benefits high enough to prevent a severe cut in a worker's standard
of living when he is between jobs. The principle is generally accepted that
it takes at least 50% of the worker's wage to meet this purpose.
Almost every State subscribes to this general principle, but benefit
ceilings in their legislation have in fact made this principle largely
ineffective, especially for the family breadwinner. At least two out of
five claimants currently fail to get a benefit equal to one-half their wages.
In 1954, President Eisenhower recommended to States that they pro-
vide a maximum high enough to permit the great majority of covered
workers to receive one-half their wages. This means that at least 80%
of insured workers should be able to receive a benefit of one-half their
wages in unemployed.
Men are most adversely affected by the limit on weekly benefits. In
one large industrial State, for example, only 23% of the men receive bene-
fits equal to as much as one-half their weekly wages.
If the program is to fulfill its role, it is essential that the benefit
maximum be raised. A maximum of two-thirds of the average wage in
the State would result in benefits of 50% in wages to at least 80% of
insured workers.
Up to now, the responsibility for determining benefit amounts has
been the responsibility of the States. There are advantages in States
having that freedom. However, the overriding consideration is that the
objective of adequate benefits be achieved. I call upon the States to act
within the next two years to meet this goal, thereby averting the need
for Federal action.
3. Encouraging Retraining
During the present decade, many manpower programs were launched
in the United States. We have seen how unemployed workers can be
equipped with new skills and started on new careers. When the decade
began, only three States permitted workers who enrolled in retraining
programs to continue to receive benefit payments. All the rest disqualified
them upon entry into training.
During the early 1960's, many States recognized the potential of
training for employment rehabilitation, and by 1969 twenty-five States,
plus Puerto Rico and the District of Columbia, had removed such
restrictive requirements.
However, twenty-five States continue to discourage retraining by
LIBRARY
denying benefits to workers in such programs on the theory that they
are not "available for work. " On the contrary, the workers are trying
to keep themselves available by learning new techniques and technologies,
and government should certainly stop penalizing them for doing something
that government, business and labor all want to encourage.
more
4
I propose a requirement that the remaining States permit workers
to continue to receive benefits while enrolled in training programs
designed to increase their employability.
4. Protecting the Insurance System
We must also be sure that benefits are going only to those people
the system is designed to protect. The funds must not be dissipated.
Attachment to the Labor Force. The unemployment insurance
system is designed to protect workers whose attachment to the labor
force is more than casual. A worker's attachment is measured by
both his past employment history and his present situation. He must
be ready, willing and able to work and trying to find work while he is
claiming benefits; and he must have had at least a certain amount of
employment in the recent past. Generally, from fourteen to twenty
weeks of work is required, depending on the employment patterns of
the State and the minimum duration of benefits.
A few States, however, measure past employment by a flat dollar
amount. This discriminates against the low-wage worker, because
it means he must work for a longer period to be eligible. Also, it
permits other high wage workers to become eligible on the basis of
very short seasonal work. I recommend that a standard based on a
minimum period of 15 weeks' employment be required as a condition of
benefit eligibility, and that no flat dollar amount be permitted as the only
yardstick.
Workers on Strike. The unemployment tax we require employers
to pay was never intended to supplement strike funds to be used against
them. A worker who chooses to exercise his right to strike is not
involuntarily unemployed.
In two States, workers on strike are paid unemployment insurance
benefits after a certain period. This is not the purpose of the unemploy-
ment insurance system.
I propose a requirement that this practice of paying unemployment
insurance benefits to workers directly engaged in a strike be discontinued.
5. Improving Responsiveness to Economic Conditions
Difficult times are far less likely to occur in nations that take the
trouble to prepare for them. The presence of a strong, anti-recessionary
arsenal will in itself help prevent the need for its ever being used.
In normal times, the duration of benefit payments may be adequate.
Most State programs now provide around twenty-sis weeks of benefits;
for the great majority of claimants, this is enough to see them through
to another job. However, if the economy were ever to falter, the number
of persons exhausting benefits would grow rapidly.
GERALD ? FORD
In each of the last two periods of high unemployment, the President
proposed, and the Congress enacted, legislation to extend the duration of
benefits temporarily. However, while this process was taking place,
many workers were without income, and the economy was exposed to
sharp declines in personal income due to unemployment.
more
5
I am proposing legislation that would automatically extend the
length of time benefits are paid in all States when the national jobless
rate of those covered by insurance equals or exceeds 4.5% for three
consecutive months. If periods of high unemployment were ever to
occur, individuals would receive benefits for an additional period up
to 13 weeks; this extension would end when the national unemployment
rate of those in the system (currently 2. 2%) fell back below 4. 5%, and
when the number exhausting their benefits in a three-month period dropped
below 1% of those covered. These additional payments would be financed
out of that portion of the unemployment tax that is now retained by the
Federal government.
6.
Strengthening and Reforming Financing
We must enable the Federal government to finance its share of the
improvements proposed in this message, along with the costs of
administering the Employment Security System. In addition, there will
be a. need to improve the ability of States to finance the higher benefit
levels I am urging.
I propose that the taxable wage base be raised over a five-year
period to $6,000 and thereafter be reviewed periodically to make certain
the adequacy of financing.
In the majority of States, the taxable wage base for the Unemployment
Insurance Tax is the first $3,000 of wages -- exactly what it was three
decades ago. In that same period, average wages in employment covered
by the system have increased almost five-fold. The low tax base places
obstacles in the way of hiring low-wage workers because a substantially
higher proportion of their wage is taxed. In addition, the impact of the
tax tends to encourage use of overtime rather than adding workers.
The higher base will have the desirable effect of allocating costs
more equitably among employers. Particularly at the State level, overall
benefit costs will represent a lower per cent of taxable wages, and allow
rates to reflect employer experience more accurately.
An Anchor to Windward. Unemployment insurance was begun as an
answer to the human need for sustenance of the unemployed workingman
seeking another job. It was designed to reduce the element of economic
panic in job-hunting.
But as we move now to extend that insurance and meet that need more
fully, we discover not quite by accident the bonus of serendipity.
Here is insurance purchased through a tax on the employers of America
in behalf of their employees that can be a potent counter to a downturn in
the business cycle. This proves that well-conceived social legislation
can be a great boon to business and to all Americans affected by the state
FURD LIBRARY
of the economy.
The success of this system can be a great example in the relationship
between the States and the Federal government.
The Federal government brought this unemployment insurance
system into being but the States have rightly adopted it as their own.
The Federal government has traditionally established minimum coverage --
but many States have expanded that coverage to fit their own needs.
more
6
Now the Federal-State system of unemployment insurance should
move to provide adequate benefits in accordance with the goal that has
been set and with full recognition of the diversity of economic conditions
among States. Such action is most important to protect the individual
and to achieve the anti-recessionary potential of unemployment
insurance.
The Federal and State actions recommended will help advance the
economy of each State and in protecting the economy of the nation. In
human terms, the recommended changes will better enable a worker to
weather the adversity of unemployment and to find a suitable job.
I urge that the Congress and the States enact the legislation proposed
to carry out these improvements.
RICHARD NIXON
THE WHITE HOUSE,
July 8, 1969.
# # #
GERALD R. LISBERT FORD
NEWS
CONGRESSMAN
GERALD R. FORD
HOUSE REPUBLICAN LEADER
RELEASE
--FOR IMMEDIATE RELEASE--
July 8, 1969
Statement by Rep. Gerald R. Ford, R-Mich., on the President's Message dealing
with Unemployment Insurance, July 8, 1969.
President Nixon's proposals to expand, improve and strengthen our unemploy-
ment insurance system clearly constitute one of the most important items of
legislative business on the agenda of the 91st Congress.
It is vital that we extend unemployment insurance to an additional 4,800,000
workers as recommended by the President and that we provide for payment of benefits
during worker retraining and for automatic extension of benefits during long
periods of high unemployment.
I expect that these proposals by President Nixon will be relatively non-
controversial. The fight, if any, will come over the recommendation that states
be given two years to meet the goal of paying unemployment benefits amounting to
at least 50 per cent of a worker's weekly wage.
In this connection, it should be remembered that the unemployment insurance
system is a Federal-State program. Every attempt should therefore be made to
improve the system with the full cooperation of and action on the part of the
respective states.
I subscribe to the concept that unemployment benefits amounting to at least
50 per cent of a worker's weekly pay should be paid in every state. In those
states where this objective is not being met, injustice is visited upon the
unemployed who are eligible for unemployment insurance benefits. Also, employers
in that state are given a competitive advantage over employers in other states.
But it would be far better to achieve the 50 per cent objective through
federal encouragement than through federal bludgeoning. I therefore feel
GERALE FORD LIBRARY
grace period is in order.
Enactment of the other Nixon recommendations into law will greatly
strengthen our unemployment insurance system and improve the health of the
American economy.
###