To press for the enactment of these reforms, the Progressive academics also established a constellation of advocacy groups, including the American Association for Labor Legislation, which, as Axel Schafer concludes, “created and sustained the organized social insurance movement.” Founded in 1905, the AALL was a direct offshoot of the American Economic Association, an organization founded by German-trained Progressive economists and expressly modeled on the leading German economists’ association (the Verein fur Sozialpolitik). As Daniel Rodgers points out, Richard T. Ely played a leading role in the founding of both organizations, and served as the AALL’s first president. His former student and University of Wisconsin colleague, economist John R. Commons, served as the AALL’s first executive secretary, and its board “was stocked with German-trained progressive economists.” In 1914, when the AALL expanded its initial focus on industrial safety and workmen’s injury insurance to include unemployment, old age, and sickness insurance, Rodgers concludes, it had become “the most active and important social insurance lobby in the United States.”
The Progressive academics also, importantly, trained students — including Frances Perkins, Edwin Witte, and Wilbur Cohen – who became the leading architects of social insurance during the New Deal and Great Society. Perkins, who had studied economics with Progressive economist Simon N. Patten, was FDR’s secretary of labor and chairwoman of the Committee on Economic Security (CES), the expert committee FDR tasked with formulating what became the Social Security Act of 1935. Witte, who is sometimes referred to as “the father of the Social Security Act,” was the executive director of the CES, and actually wrote the committee’s report. Before joining the CES, he had been a member of the economics faculty at the University of Wisconsin, where, as Rodgers notes, he had earned his Ph.D. and been a “Commons protégé.” Wilbur Cohen, “The Man Who Built Medicare,” was, in turn, another Commons student from the University of Wisconsin who began his long Social Security Board/Administration career as Witte’s research assistant at the CES. The CES’s initial proposal, in any case, included provisions for the creation of a health-insurance program, as well as unemployment compensation and a compulsory old-age-pension system (Social Security). FDR, despite being an enthusiastic supporter of comprehensive social insurance, decided to drop the health-insurance program for fear its inclusion would defeat the entire measure. The most significant steps in the creation of federal health insurance, Medicare and Medicaid, accordingly, were not taken until LBJ’s Great Society.
Our debt crisis, in sum, has everything to do with the transformation of morality and government effected by the late-19th- and early-20th-century Progressive movement. Far from being largely ineffectual reformers, the Progressive academics who articulated the new conception of Freedom and the “positive” State, outlined above, were also the initiators of the entitlement programs that lie at the core of our crisis today. How Americans ultimately decide to resolve this crisis — by reining in spending or meekly submitting to far higher taxes — will serve either to revitalize the Founders’ conception of freedom, and the idea of limited government that flows from it, or seriously accelerate America’s century-long slide into the “overlordship” of Progressivism.
– Tiffany Jones Miller is associate professor of politics at the University of Dallas.