Nectar & Pickle Juice

For old New Dealer Lyndon Johnson, the signing of the social security bill last week offered a threefold blessing: a chance to memorialize F.D.R., an occasion to tell 24 million present beneficiaries that, beginning in March, they would get the biggest increases in payments enacted since social security began--and the knowledge that most voters would not feel the additional cost until after Election Day.

Average payments to beneficiaries will rise 13% in 1968, while at the low end of the scale the increase will be 25%. The law provides for additional increments in later years. Medicare benefits will be expanded as well. And although the base on which both employers and employees pay the social security tax rises this year from $6,600 to $7,800, the present tax rate of 4.4% does not begin going up until 1969, when it will be 4.8%. Subsequent increases over two decades will bring the figure to 5.9%.

However, as with much of the 90th Congress' output, Johnson found the nectar laced with pickle juice. Congress attached provisions aimed at curbing the ever-growing welfare rolls, and though the Administration considers them severe, Johnson could not veto the restrictions without rejecting the entire law.

Outmoded System. The amendments affect the Aid to Families with Dependent Children program (A.F.D.C.), the largest category of relief financed by federal, state and local funds. They require each state to determine the proportion of its children receiving such benefits as of this month and to limit the use of federal money in the future to this fraction. Because the poor bear more children than the affluent, the proportion of needy minors is estimated to be increasing from 4.7% now to 5% in 1970. Therefore states will either have to make eligibility rules more stringent, reduce the load by other means, or produce the funds themselves to support the extra indigents.

Johnson promised that the Department of Health, Education and Welfare would write implementing regulations that would serve as "compassionate safeguards to protect deserving mothers and needy children." The President also acknowledged tacitly that the sentiment behind the restrictions has some validity. "The welfare system today," he said, "pleases no one," and is, in fact, "outmoded." He proposed no grand new scheme, but fell back instead on one of his favorite devices by appointing an 18-member Commission on Income Maintenance Programs, to be headed by Ben Heineman, board chairman of the Chicago & North Western Railway. The group was instructed to "examine any and every plan, however unconventional, which could promise a constructive advance in meeting the income needs of all the American people."

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