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Show Townsend Plan Leads In Talk Of Old Age Pensions would defeat the object of the plan, which is to get money into circulation. The Townsend argument: about 12,000.000 have signed petitions asking congress to put the plan into effect. It is not so much a pension plan, as a plan to get money circulating and business flowing; it would make younger people producers and older people peo-ple spenders. The argument against the plan, by Dr. Edwin Witte, chairman of the president's committee on economic securiy: The plan would cost between $19,000,000,000 and S24 ,000.000,000 a year. This is about double the total federal spending for a year; it is ten times present relief costs. This huge drain out of the earnings of the people would cripple their buying power. The plan is, simply, a transference of buying power from the young to the old for the benefit of less than nine per cent of the people. Even a ten per cent sales tax would raise only from three to five billions a year. The tax would have to be at least 50 per cent to raise enough money... But the old country doctor's scheme has taken an immense hold on many people; a good many When the subject of old-age pensions comes up. the so-called "Townsend plan" usually is given prominence. Just what is the plan? What are the arguments for and against it? In the first place, the plan's author is aged, enthusiastic Dr. Francis Everett Townsend, a transplanted midweslerner now living at Long Beach. California. Dr. Townsend is now in Washington, Washing-ton, D. C, explaining his scheme to anyone who wants to listen. The Townsend plan proposes a federal pension to everyone over 00 who is not a criminal. The monthly amount would be $200. The money would be raised by a general sales tax. It is figured about 10,000.000 would be eligible for the pension, which would mean an initial payment pay-ment of $2,000,000,000. Dr. Towns-end Towns-end says a two-per-cent sales tax would raise this amount. The author also says that only about 8,000,000 would apply for the pension and that the total necessary nec-essary to start the fund would be around $1,600,000,000. Under the plan, the $200 would not be paid to the pensioner: it would be deposited to his account in a bank. If. at the end of the month, he had not spent the entire amount, he would lose the pension for the next month. Apparently this overlooks the possibility that the pensioner might simply draw out the money for spending ostensibly, and then hoard all or part of it. This congressmen have given it lip service. While it may not be within the bounds of probability, its enactment is a distinct possibility. |