How Social Security Was Defended by Supreme Court Justice Robert Jackson

by John Q. Barrett

Mr. Barrett is Professor of Law at St. John’s University in New York City. He discovered, edited and introduced Justice Jackson’s previously unknown, never-published memoir, That Man: An Insider’s Portrait of Franklin D. Roosevelt, which now is available in paperback from Oxford University Press.

Social Security, which grew out the political leadership and humane vision of Justice Robert Jackson’s great patron and friend FDR, has been a centerpiece of American life and law since the late 1930s. When Roosevelt took office in 1933, the country was at the depths of the Great Depression. Tens of millions of people, including many elderly, were living in poverty and desperation.

In January 1935, Roosevelt advocated the U.S. government using tax payments from employers and workers to insure literally the financial survival of both the unemployed and the elderly—legislation that would provide payments to people who had lost jobs and to senior citizens whose working years were behind them. Some, particularly businesses, objected, but most people and Congress supported Roosevelt’s ideas that government could do much to improve these basic aspects of “social security.” On August 14, 1935, Roosevelt signed the Social Security Act into law.

Businesses that were subject to new taxes soon filed federal lawsuits. They claimed that the U.S. Constitution did not authorize the federal government to create and administer the new unemployment compensation and old age pension programs. These lawsuits reached the Supreme Court—which by then had compiled quite a record of hostility to many New Deal laws—in spring 1937.

Although Jackson’s formal position in 1937 was Assistant Attorney General (the third tier of FDR’s team at the Department of Justice), Jackson became a central player in the Social Security cases as they headed for the Supreme Court. He was a co-author of the government’s brief in each case and, when it was time for the oral arguments before the Court, Jackson was one of the government’s principal advocates.

On May 24, 1937, the Supreme Court upheld the constitutionality of the Social Security Act. In one case, Steward Machine Co. v. Davis, the Court upheld the new unemployment compensation system. In another case, Helvering v. Davis, the Court upheld Social Security’s old age pension system. The Social Security cases thus go down as two of Jackson 31 victories in 41 cases that he argued as a government advocate before a not-always-receptive Supreme Court.

Many of Jackson’s specific arguments to the Supreme Court in the 1937 cases concerned constitutional issues that no longer, thanks to victories like his in these very cases, perplex us legally or politically. But in the course of making his arguments in Helvering v. Davis (which were transcribed and published in the legislative record on Social Security), Jackson also made eloquent statements that have contemporary importance.

The following selections from his words to the Supreme Court about Social Security for senior citizens reveal five key understandings of his time:

We were, even then, an aging population:

The uncontradicted evidence shows that there are developments in the matter of the old-age problem which differentiate that problem as it exists today from the problem as it existed in the past. In 1870, out of a population of 38 million, we had 1,153,000 or less than 3 percent of our people 65 and over. That proportion had more than doubled by 1936, and out of 128 million we had 7,700,000, or 6 percent of the population, that had reached 65. …It seems that science is extending life, but that science is not stimulating the birth rate.

The general experience of Depression created a new public understanding, embodied in the Social Security Act, that senior citizen poverty can come to blameless individuals:

Congress …came to the conclusion that the general welfare of the United States would be served by abandoning the system under which age looked forward to a road that led over the hills to the poorhouse. It came to the conclusion that poverty in age is no longer a moral judgment against the individual; that if the time has been in our economy when we could say that it was only indolence and prodigality that led one to the poorhouse, that time was no longer, and that if a poverty-stricken age was the judgment of a wasted life at one time in our history, it is not so today. The lesson of the Depression broke that tradition.

That new understanding was founded in part on the facts that personal wealth, private pensions, private charities and state governments were not adequate to alleviate poverty among the elderly:

The failure of private pension plans is explored by the evidence, and pointed out in our brief. The failure of private charity to meet this problem is conclusively shown by the figures of the Bureau of Internal Revenue. In 1928 the persons with $3 million and up of income contributed an average of $25,400 to purposes for which they were entitled to the charitable deduction. By 1931 they had reduced those contributions, the same group, to $12,900 average, showing that the well-to-do retrenched in their charitable contributions during the period of Depression, although the need was greater.

The resources of the States have been declining. Real estate reserved to the States as a source of taxation has been taxed to the limit of its capacity to bear, and personalty has never been successfully taxed locally. The Federal Government, which is able to tax incomes and to lay excises, has sources of revenue which have been drying up for the States, not because of any change in the legal system but because the economic emphasis on personal property has left the States without a comparative source of revenue such as they had at the beginning of our constitutional system.

That new understanding of poverty also was grounded in the facts that personal savings and investments do not guarantee financial security:

The condition which is promised as an implication of our system, that thrift would be followed by plenty, failed in the Depression, for the man who had responded to the inducements and had accumulated a bank account and selected the wrong bank, or the man who had saved to purchase a home, found himself in the same position as the one who had never saved at all. In fact, the man who had not tried to acquire a home perhaps was better off because he was not faced with a deficiency judgment. The unfortunate consequences of this Depression bring home to us the fact that self-denial had not assured comfortable age…

We therefore recognized in the Social Security Act that fighting poverty among the elderly, which historically had been a local issue, now was a matter of national welfare:

…[I]f we are to review in this Court the question whether Congress has served the general welfare in fact, I am frank to admit that we face a tradition of 150 years of practice that is against the making of old-age relief a matter of national welfare. But I would call your attention to the fact that old-age welfare has been a constantly widening concern. The matter of the care of the old was at one time a matter for the family only. It became gradually a matter for the town poormaster if the family failed. From the town poormaster it became a matter for the county with its poorhouse, and then the State, because of failures of counties, intervened, and now we argue that it has become a matter of national welfare and this old-age-pension system was set up in the hope that it would make true the promise to men that if they were thrifty and industrious and self-disciplined their age would be spared at least extreme poverty. This plan does no more than spare extreme poverty, and may not in many instances do that. This plan was that if the workman during his productive years would contribute to the Treasury of the United States, then the Treasury of the United States in his unproductive years would contribute to his necessities.

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As we in 2005 consider Social Security and its future, selected words from Robert Jackson’s 1937 Supreme Court arguments may prove useful to various perspectives across the political and policy spectrum. Jackson’s general message, however, took only one position about Social Security for senior citizens: it was about decent, basic, reliable, public support to protect people from the dire poverty that life and turns of the economy otherwise will distribute.

Jackson ’s generation figured this out—it really was burned into them—during the depths of the Great Depression. We will, with reminders such as his fine words, not forget today that a basic, government-guaranteed social security is a defining part of our national greatness.