194 State Papers and Addresses

Because the taxpaying public has been assessed for vast sums in recent
years for relief and assistance programs, and because sufficient time has elapsed
for public officials to have passed the experimental stage in dealing with the
problem, it is timely to ask "Is the present relief program—Federal, State and
local—adequate and effective?" Such is the question which I am asked to
attempt to answer in this discussion.

No one can help but regard the subject under discussion as one of major
importance. We have witnessed during the past seven years an extension of
government activity in this area and an increase in expenditures such as was
unthought of in the late 1920's. The growth has been so rapid, the enactment
of legislation has been so fast, as to make it almost impossible to keep abreast
of nationwide developments. That the present holds many problems and ques-
tions for the future cannot be gainsaid. Therefore it becomes our responsibility
to bring to bear upon this function of government the best critical analysis and
planning of which we are capable.

There was a time within the recent memory of all of us when expenditures
for relief to persons in need were but a small percentage of the total cost of
government. Figures are lacking for the years prior to 1933, but we know
that in the years before the depression public relief was largely a matter of
local responsibility and few, if any, state budgets made any provision for this
purpose. Federal appropriations were, of course, completely absent from the
picture.

Today, the combined Federal, State and local governments spend for public
assistance and earnings of persons employed under Federal works programs,
around $274, 000, 000 per month (February, 1940). And this assistance is ex-
tended to an estimated six and a half million households, comprising a number
estimated to be 18, 700, 000 persons.

Estimates of unemployment during the 1920's show that during that period
of relative economic prosperity there was already a sizable body of unemployed
persons. It was not, however, until the downswing of 1930 and 1931 that the
problem became so severe as to call for united national action, A few states led
the way in providing funds for unemployment relief until finally, in July, 1932.
the Congress enacted the first emergency relief act, authorizing the Reconstruc-
tion Finance Corporation to lend Federal money to the States for the relief of
unemployment. Events thereafter followed in quick succession; the bank
failures of 1933, the creation of the Federal Emergency Relief Administration,
the overnight springing up of state emergency relief agencies to receive and
expend tax money for the relief of distress.

Looking back over this period we cannot but become aware of the new
principles of government which thereby became firmly established in our
political life. In the first place, we witnessed the legislative creation of a new
form of Federal grant-in-aid. Not that Federal grants-in-aid were new in
themselves. We were familiar with them, through long experience, in the fields
of highway building, agricultural extension, forestry, and so on. But the
principle of Federal grant-in-aid had never been extended to the granting **
relief. Secondly, we witnessed the introduction of sizable amounts into State
budgets for the same purpose. The resources of the cities and counties would
have been totally inadequate to meet the problem as it then confronted us.

Inherent in this broadening of the financial base was a widespread accept-
ance of the belief that the causes of human distress were not local but national,