Mr. President, House Bill 13549, the Social Security Bill, now pending before the Committee on Finance, is designed to adjust benefits levels to meet the high cost of living. Unfortunately, it ignores still another pressing problem confronting most American families: the high cost of dying.
I submit an amendment to the Social Security Bill, cosponsored by the Senator from Florida (Mr. Smathers), to remove the outmoded, arbitrary dollar ceiling of $255 which now limits what is known as the lump-sum death payment. This payment was designed to help tide the widow, children, and other survivors over during the expensive days of the funeral and other final arrangements.
Congress intended that this lump-sum payment be three times the regular monthly benefit – and in the 1952 amendments, Congress set the maximum monthly benefit at $85, and thus the lump-sum death payment at $255. Unfortunately, in 1954, when Congress increased the primary insurance benefit, the old dollar ceiling on death payments was retained. Again, no change was made in the 1956 amendments. Now, in 1958, the bill as passed by the House again increases the regular monthly benefit for the retired worker, but does nothing about the heavy expenses his family must suddenly bear upon his death.
This amendment would, if agreed to, remove the old dollar maximum so that all families, instead of some, would receive a lump-sum death payment of three times the primary benefit, as Congress intended. This would mean a maximum of $381 under the House bill, instead of $255. Payments could still be as low as $99.
This amendment, to restore the 3:1 ratio in all cases, was agreed to by the Senate in 1954. I hope it will pass this body again this year, when the need is even more pressing, and remain in the final bill.
The entire cost of removing the meaningless $255 ceiling, under the new overall benefit increase in the House bill, would be only two one-hundredths of 1 percent of payroll taxable under the Social Security program, so negligible as to be meaningless in a 50-year actuarial projection.
Can we neglect for this small cost to provide the increased equity and justice that the change would bring? Can it be seriously contended that the program cannot afford to provide this limited amount of additional help to some 300,000 widows, orphans, and parents each year – about two thirds of them widows – in meeting the often crushing expenses that accompany the death of a husband, father, or son?
The meager lump-sum payments now provided will not take care of even a very modest funeral, to say nothing of helping defray last illness expenses. A 1957 study in New York State gives an average cost of funerals of $875. Thus a payment of $255 covers less than one-third of the funeral expenses in the average case.
It is not pleasant to contemplate the plight of a deceased worker’s family who, in the face of their bereavement, must mortgage their desperately needed monthly social-security benefits to pay the costs of the last illness and burial.
More and more families are worried about meeting this burden in the near future, and I hope that this Congress will do something about the high cost of dying.
Mr. President, on behalf of myself, and the Senator from New Jersey (Mr. Case), I submit an amendment, intended to be proposed by us, jointly, to House Bill 13549, the Social Security Bill, now pending before the Committee on Finance.
Mr. President: The Social Security Bill now pending before the Senate Finance Committee increases benefits 7 percent. This is not enough. At the very least, our older citizens should receive an increase in benefits commensurate with the increase in the cost of living. This bill is frequently described as an adjustment to meet the increase in the cost of living. But since benefit levels were last amended in 1954, the cost of living has increased by 8 percent, not 7 percent, I am introducing an amendment which would raise benefit levels 8 percent. While the difference may seem small on paper, and indeed costs very little in terms of the total program, it is of vital dollars-and-cents difference to our retired workers and their families.
The House Committee on Ways and Means recognized that the 7 percent increase is inadequate, stating in its report that a higher level "would be justified if one considered solely the need for this protection. The increase of approximately 7 percent provided by the bill is actually somewhat short of the rise in the cost of living that has taken place since 1954."
The impact of cost of living increases is felt perhaps more keenly by our older citizens than any other group. They have no union to protect them; they are unable to raise prices like businessmen; and they are in most instances without investment income. It is our obligation and our responsibility to see that they do not suffer because of fluctuations in the economy beyond their control.
The amendment would cost about 1/10 of 1% of payroll. It would not, therefore, require any increase in the contribution rate or disturb the actuarial status of the program.
Source: David F. Powers Personal Papers, Box 30, "Social Security, Washington, DC, 8 August 1958." John F. Kennedy Presidential Library.