Social Security measures in the United States have not yet been tested under adverse economic conditions; Germany has operated state-sponsored welfare programs for over half a century. Dr. Sulzbach1 reviews the history of German social insurance in order that America may foresee the economic and psychologic problems which she will face in the future.
The concept of compulsory social insurance was introduced in Germany by Chancellor Bismarck in 1881, in order to win over the laboring class by offering a form of government assistance more dignified than relief. Because employers were required to pay a part of the premiums, the programs were enthusiastically received by the workers and grew until the 1932 depression revealed their basic flaws. The several schemes were never integrated into an over-all system; each operated under a different plan and a separate administration. Each, with the exception of unemployment insurance, started from a small beginning
Dickinson FG. GERMAN EXPERIENCE WITH SOCIAL INSURANCE. JAMA. 1948;138(2):149-150. doi:10.1001/jama.1948.62900020009025