North America’s Divide - The Political Geography of Inequality - page 119

awareness among political elites about the need to provide timely alternatives
in terms of relief and insurance. Among these proposals were Long's plan
for a flat universal pension to be given to anyone over sixty or Tawsend's
plan to issue a sales tax to pay $200 per month to every American Citizen
except convicted felons (Berkowitz 1991 : 1-39); or, later on in the process,
the Lundeen Bill, submitted to (and defeated in) Congress by Representative
Lundeen fromMinnesota in 1934 and 1935. The bill provided “for the payment
of unemployment compensation out of the funds of the national government
to all unemployed persons over the age of eighteen years for as long as they
were out of work through no fault of their own” (Douglas 1936 : 74).
These and much less radical proposals met two sources of resistance: a
virtually universal opposition from business to the comprehensive development
of social insurance, and a very heterogeneous set of positions at the state
level on how to respond to the problem of unemployment. Both the level of
business opposition to social insurance initiatives and the heterogeneity in the
stated positions by subnational governments were more intense in the United
States than in Canada. After an extensive review of the position of business
on the development of social insurance policies in the United States, Hacker
and Pierson ( 2002 ) concluded that business interests systematically resisted the
development of social insurance programs throughout the country.
However widespread, the intensity of resistance was not homogeneous
across states. In line with the expectations derived from the model, business is
especially hostile to the centralization of social insurance in those states with
lower levels of development and asset specific, labor intensive, industries. In
these cases, concerns for the income implications of the program reinforce
concerns about federal intrusion on the workings of the local economy. In a
thorough account of the position of American states on the development of
social insurance in the years immediately preceding the New Deal, Patterson
( 1969 ) shows how the most adamant hostility came from leaders like Eugene
Talmadge, the openly racist and reactionary governor of Georgia. Typically,
the rejection of the federal government's proposal took the form of a strong
advocacy of states' rights. At the 1935 Governors' Conference he stated, “Any
regulation of business - any of it - we object to it. We Governors object to them
taking our sovereign rights; we object to them coming into the states to setup
activities that we know are states' rights” (cfr. Patterson 1969 : 237). Other
Republicans raised similar concerns.
Partisanship exacerbated these criticisms, but it did not eliminate tensions
within the Democratic Party. Indeed, several Democratic states (Montana, West
Virginia) oscillated between skepticism and frontal opposition to Roosevelt's
approach to the issue of unemployment. Even as late as 1936, when the Social
Security Act had already passed and Roosevelt was a dominant political figure,
Montana's Democratic Governor, Elmer Holt, expressed the following con-
cern: “It does seem to me that some departments of the Administration are
catering too much to the 'Red' element.” 9
9 Letter from Elmer Holt from September 11, 1936, as quoted in Patterson ( 1969 : 154).