There is an appalling mass of misfortune in the United States requiring social insurance for its relief, although satis factory statistics of the various types of misfortune are still lacking. On the basis of the experience of private industrial insurance companies, it appears that there are not less than 25,000 fatal industrial accidents yearly, and 700,006 injuries causing disability for more than four weeks, besides an enor mous number of slighter injuries, many of them very pain ful, disabling for a period from one day to four weeks. This means that the loss in life and bodily injuries in industry in the United States while the country was at war in 1917 and 1918 was about equal to the like losses of our soldiers on the battle-field.
As to loss of time due to illness, the experience of Ger many shows an average of eight or nine days a year per worker, and investigations in America point to a very simi lar figure. This, applied to those gainfully employed in America, would mean nearly 300,000,000 days of illness, or 1,000,000 one-man working years, causing a loss estimated at $750,000,000 annually (but at present wage rates fully $1,000,000,000).
It is estimated that one in eighteen of American wage work ers attains the age of sixty-five with no financial provision for old age, and that about 1,250,000 persons above the age of sixty-five are dependent on their families or on charity, public or private, receiving $250,000,000 yearly. The losses and suffering to dependents due to the death of the bread-win ner are partially accounted for by accidents, but no estimate of much value can now be made of the other cases. Some notion of the losses from unemployment has been given in discussing that subject in the preceding chapter.
§ 3. The new era of social insurance. Some not insignifi cant attempts to deal with these problems were made in the nineteenth century, but the new era of social insurance may be said to date from the message of the Emperor William to the German Reichstag in 1881, in which he said: We consider it our imperial duty to impress upon the Reichstag the necessity of furthering the welfare of the working-people. . . . In order to realize these views, a bill for the insurance of workmen against industrial accidents will first of all be laid before you; after which a supplementary measure will be submitted, providing for a general or ganization of industrial sick-relief insurance. Likewise, those who are disabled in consequence of old age or invalidity possess a well-founded claim to more relief on the part of the state than they have hitherto enjoyed.
The program here outlined was carried out by the enact ment between 1883 and 1889 of a series of laws which, taken together, constituted a pretty effective system of social insur ance for the mass of wage workers in the German Empire. Later amendments extended and improved the various features of the plan, which served as an example to other countries. America has been the tardiest among all the industrial nations to undertake this kind of social ref orm.
Insurance may be voluntary or compulsory. It is voluntary when the state simply encourages the formation of insurance agencies, and perhaps contributes something to them, leaving it to the individuals to insure themselves as they choose, in mutual societies or in privately managed companies. In the case of accident insurance, however, there is often a semi compulsion by which the employer is required to pay indem nity to his workers according to fixed scales of compensation, but is left free to insure himself against this risk or not as he pleases, in which case it is still called voluntary insurance. Compulsory insurance is that which the state requires to be provided by means of some mutual organization of the insured, or of the employers, or by the state.
Insurance may be contributory or non-contributory. It is on the contributory plan when the insured workers contribute something toward the premiums that provide the funds for eventual payment. It is non-contributory when the funds are provided either by the employers or by the state without any payments from the insured.
Insurance may be (a) in private companies, carrying on the business for profit; or (b) in mutual companies of work ing men, or of employers insuring themselves against the cost of compensation in case of accident to their employees; or (c) in a state bureau, or fund, organized and conducted by gov ernment. The state insurance is said to be competitive when private companies are permitted to sell insurance to em ployers, and exclusive when all the policies are issued by the state bureau.