GERMAN WORKINGMEN'S INSURANCE AND FOREIGN COUNTRIES1 DR. ZACHER' Looking over the previous development of German workingmen's insurance, it is desirable to present in this journal the international standpoint, and to sketch the manifold relations between the German workingmen's insurance and foreign countries. First of all the question is urged, How far have the objections which other countries, both formerly and at present, have brought against the bold enterprise of Germany been removed or confirmed by the actual development? If we follow, in the previous discussions in journals, and in the acts of the international workingmen's insurance congresses, the history of the foreign workingmen's insurance legislation, it appears that a principal hindrance to imitating the German example consistently is almost everywhere the fear of a financial burden; that is, a strain upon the industrial capacity of the various occupations, and consequently a disadvantage in international competition between nations. This fear has been skilfully used by the opponents on principle of every form of social legislation, even apart from compulsory insurance. The wider the circles of German workingmen's insurance extended and the greater the annual expense of millions for indemnities and capital reserves increased, the more these opponents referred to the danger of the assessment methods of the German accident insurance, and the billions required by invalid and old-age, not to mention orphan and widow, insurance in their own countries. The parliamentary reports of all European states which have considered 2 'Translated from the German by C. R. Henderson, the University of Chicago. * Author and editor of the series Die Arbeiterversicherung im Auslande. such projects of law contain only too much material on the subject. What is the teaching of actual trial? In the field of accident insurance, not in Germany, but in those countries which did not follow the German examples, financial and technical insurance problems have arisen, and this because they were compelled to throw overboard premium rates and calculations of payments which had no adequate basis, and which, therefore, proved false in the tests of practice. In this connection reference may be made to the failure of the technical insurance figures of the Austrian, Norwegian, and Holland accident insurance, of the experimental premium tables of the French, Belgian, and English private insurance societies, and others. On the contrary, the German accident insurance was free from these mistakes; has developed normally, and enjoys increasing recognition abroad. The best proof of this is that the insurance plans copied after those of the German tradeinsurance associations, as of late in England and France, have manifestly worked with advantage; and that in the United States of America, which now is thoroughly interested in these questions, the approval of the German example seems to be gaining ground, not merely on account of the simplicity and economy of the whole system, but also because of its superiority in the important field of accident prevention. In reference to the invalid and old-age insurance we may learn from the proceedings of the last International Social Insurance Congress at Rome, in 1908, especially in the confessions of Luzzatti and Mabilleau, and from the thirty years of previous history of the French law of April 10, 1910, that in this field thorough success without compulsion to insure cannot be assured. On the other hand, German experience shows that the fantastic milliard calculations of opponents could practically be met, and that the capital collected to pay claims as they fall due was not only not a danger for the public welfare, but in reality an unending blessing; as has been shown by persons free from bias.3 3 Bulletin d'assurances sociales (1910), 234-67. Has this entire burden of the German people, by its social insurance, become a hindrance to national progress, and to the capacity for competition in international trade-as has been asserted in the past and is still sometimes claimed? Here also the facts may speak for themselves. It is precisely in the last quarter of a century, under the régime of social legislation, that Germany has increased its population from forty-six to sixty-five millions, now about at the rate of one million each year; and has advanced from the fourth to the second place in the world's trade; and now, with its seventeen billion marks of foreign trade, is behind the British Empire by only a few billions. The property of the people at the same time has doubled in value, and at present is reasonably estimated to be about two hundred and fifty billions. The annual income of the people is about thirty billions of marks. There are about eighteen million savings-bank accounts with annual deposits of three-fourths of a billion, and property which has risen in value from two billions in 1875 to fourteen billions. In this improvement the workingmen, the majority of the nation, have an increasing share. The wages, as proved by social-insurance statistics and expert investigations (for example, Schmoller, Dade, Calwer, Kuczynski, Ashley, etc.), since the introduction of the imperial workingmen's insurance laws, have risen, on the average, for unskilled workmen about 25 per cent, and for skilled workmen about 50 per cent, and in certain trades even 100 per cent. And this increase of wages, which, according to Professor Ashley, has not been attained in any other country, has by no means been counteracted by the increase of cost of means of subsistence, even according to the judgment of social-democratic leaders and scientific journals. According to household budgets and statistics, the expenditures for the means of subsistence, on the average, require only half the income. The consumption of the necessary means of subsistence has steadily increased, the use of meat remaining only a little below that of the English population; so that the living conditions of German workmen, as an English commission 'Cf. Denkschriften zur Reichsfinanz-Reform, 1908. has abundantly proved, have improved in all directions. Furthermore, the statistics of taxes show that the number of persons with taxable property has increased; and that, in agreement with this fact, the wage statistics of this great sickness-insurance funds, and the accounts of the sale of stamps for the invalid-insurance funds show an ascent of insured persons up from the group of low-paid workers to that of the more highly paid wage-earners (cf. Reichs-Arbeitsblatt). To all this we must add that the figures relating to unemployment are lowest in Germany; that emigration, which was so great in the decade 1880-90, has almost ceased; that, on the other hand, Germany of late needs almost a million foreign workmen in order to cover the needs of manufactures and agriculture (cf. Dade). But it is not merely in material advance that the majority of the people have shared. According to the most recent publications the apparent longevity rose from 38.1 to 48.85 years for males and from 42.5 to 54.9 years for women; the general rate of mortality has diminished considerably; mortality from tuberculosis has fallen nearly onehalf, so that there is ground for hope that this dangerous plague, within a reasonable time, will come under control-a hope whose fulfilment could hardly be expected without the powerful organization of social insurance. To all this we add the consideration, that social insurance, with its curative and preventive measures, offers advantages annually to millions of workmen and their families. Thereby not only the vast number of workers of the nation is maintained, but their vital energy is also greatly augmented by popular hygienic education. Thus we can explain why, in spite of the rapid development of German manufactures, both the number and physical condition of recruits show an upward tendency. If we put together all these considerations, we can claim, in opposition to the assertion mentioned above, that social insurance has been a co-operating cause of the unexampled advance of Ger $ Cf. Zacher, Die Arbeiterversicherung im Auslande, IV, 1*-60; Zahn, "Beziehungen zwischen Arbeiterversicherung und Armenwesen in Deutschland,” Bulletin de la Conférence Internationale de la Haye, II, 491-550; Dade, "Die Einwirkung der vom Fürsten Bismarck 1879 inaugurierten Wirtschaftspolitik auf Industrie, Handel und Landwirtschaft," Verhandlungen der Steuerund Wirtschaftsreformer, 1910. *Statistik für das Deutsche Reich, Vol. XX. many. In the increasing recognition of these economic effects we may discover the explanation of the more rapid progress in similar legislation in other countries. Another point at which foreigners have hesitated is the organization. They have criticized the enormous apparatus which requires a legion of officials, so complicated that it could not be kept in motion except in a country under a strictly military control like Germany. We have already explained how the threefold division of the German social insurance laws (sickness, accident, and invalid insurance), and the complex forms of organization, arose naturally out of the historical development. It has been possible to open new ways, while joining the new to existing arrangements, and utilizing them for the general purpose; and improvements are introduced in consequence of practical experiments. This has happened in the reform laws of the decade 1890 to 1900 (K.V.G. 1892, J.V.G. 1899, U.V.G. 1900), and will be further manifest in the new imperial insurance regulations. Both reforms have left the foundations of the system unchanged. We have declined to admit any blending, or uniformity of organization; and this is the best proof that the German social insurance, in spite of the variety of forms, was built on sound principles, and that the various forms of organization had good reason for being, in the difference of the risks to be insured. Yet not a few of those who have had practical experience in administering the legislative measures believe that the purpose of these reforms would have been more easily and surely attained, if, even in the year 1895, the well-known reform propositions of Bödiker' and his brilliant talent of organization of such insurance plans had been given a freer chance. But every reform of organization and administration finds all the stronger opposition where the particular organizations have been thoroughly established. This has been well shown in relation to the simplification and increased centralization of sickness insurance, and the two projects for the German Imperial Insurance Regulations (April, 'See the international survey in Reichs-Arbeitsblatt, 1910, No. 7, Sonderbeilage. Die Arbeiterversicherung im Auslande, XVII, 18* ff. 'Wiener Kongress, 1905, I, 528 ff. |