Interview #3

Interview with Arthur Altmeyer
By Peter A. Corning

Washington, D. C. September 14, 1966

Q: For my first question this afternoon I'd like to ask you to talk a bit about the health insurance movement in the 'teens', your general recollections of it, and specifically your own role in it. And also, I wonder what your explanation is for the failure to enact compulsory health insurance at that time.

Altmeyer: Well, I was assistant to John R. Commons, professor of economics at the University of Wisconsin, his research assistant, and he asked me to survey the attitudes of the various groups that would be concerned with health insurance or were concerned with health insurance, which I did. The occasion was that he'd been asked by two of the state commissions that had been appointed to study the question of compulsory health insurance to prepare such a report. And our report was submitted to the Illinois commission and to the Ohio commission. It indicated opposition on the part of such groups as the drug industry, as I recall, and that was my first really extended experience with the health insurance movement.

Q: How much interest was there in this at this time? Was this something you would say was only a matter that was of interest to a very few people, rather than something that had appeal among labor unions, for example?

Altmeyer: I think a relatively small number of persons who were familiar with the development of health insurance and social insurance generally in European countries felt that the United States was lagging, and that was particularly true of the American Association for Labor Legislation, which was supported to some extent by a few labor leaders but for the most part intellectuals. That is the explanation why the movement really never resulted in legislation, although there was a lot of attention given in the various states to state commissions. I think it stemmed pretty largely from a few individuals connected with the universities, and, as I say, a few labor leaders, who induced the state legislatures to appoint a commission.

Q: It did not move into the political arena in any strong way, I take it, becoming the kind of issue that Presidents and Senators and Congressmen debate in their campaigns?

Altmeyer: It didn't become a national issue at all, and I don't think it became much of an issue in any of the states. I think the reason was that there was no voter bloc to push for legislation. Organized labor really didn't show enough interest to push for it in the state legislatures. They never dreamed of the federal government having a role at that time. That was considered unconstitutional and outside the purview of federal power.

Q: I think, in part, you've answered the second part of the question--the explanation for the failure to enact compulsory health insurance at that time.

Altmeyer: Well, your second question deals with the personality of John B. Andrews and the character of the American Association for Labor Legislation.

Q: No, I was referring now to the second part of the first question, the explanation for the failure.

Altmeyer: Yes, it does.

Q: Perhaps we could move on, then, to the second question.

Altmeyer: Andrews was of course something of a one-man show. He ran the American Association for Labor Legislation. Professor Commons was very active in that along with other like-minded intellectuals, and, as I say, one or two labor leaders. He did a lot with very limited resources, I would say. Andrews was not as temperamental, emotional and volatile as Epstein was, who came somewhat later and organized the American Association for Old Age Security. But he was a strong-minded person and was sensitive about his being the person to whom all things ought to be referred and to be looked to for policy developments.

Q: You're referring now to Andrews. Do you know anything about his background? Do you know how he came to play the role he did, how he became interested in these issues and became a leader in the American Association?

Altmeyer: No, I don't. I don't remember whether he'd ever been a student of John R. Commons or not, but his wife I was going to say had been a student of Commons, but I'm not even sure of that.

Q: Was Andrews from Wisconsin, do you knows?

Altmeyer: No, he wasn't from Wisconsin as near as I can recall. I think it should be well to go and look him up in Who's Who for that period.

Q. That's a good idea, as a matter of fact. And what about the AALL as an organization? How would you characterize it?

Altmeyer: Well, as I say, I think it did a great deal with very limited funds.

Q: The membership were, I take it, a relatively small number and again, intellectuals.

Altmeyer: I think so, yes.

Q: And what about John R. Commons? You've mentioned him here already a couple of times.

Altmeyer: That's a large order when you say, "What about John R. Commons?" He was very active, had been active since the turn of the century in social legislation, and not only social legislation or labor legislation specifically, but in such things as civil service reform, public utility regulation, proportional representations. He was very much interested in putting economics to work through government, and at that time there was not the sharp division between political science and political economy. So he was a combination of the two really.

Q: Do you have any strong personal recollections about John R. Commons? Could you perhaps describe him for me physically and describe his personality?

Altmeyer: He was a small man and had not been in very good health all the years that I knew him, which was from 1911 until the time of his death--talking pills a great deal of the time and seemed to feel the cold. He always had on a lot of clothes--heavy sweaters and so on. But a great worker. He'd work at home for the most part rather than at his office. He'd wander into his office during the day sometime. Usually he'd keep his appointments so far as seminars were concerned, but he used them really as a foil to try out any ideas that he'd developed since the last meeting of the seminar. And his ideas always were changing or evolving rather, and he'd put the individual members to work running down this writer or that writer and the other writer. He'd get into the field of psychology and philosophy and law and medicine as well as political science and political economy. He was that sort of a person.

He became very much intrigued with the thesis that the Supreme Court of the United States was the agency through which not only our political freedom but our economic institutions were being formed by its interpretation of property and due process of law. Was a man's job property? If so, could he protect it and could he join with his fellow men, or was it a conspiracy? Could employers be compelled to bargain or could they, on the other hand, require workers to sign what were known as yellow dog contracts?

Q: It sounds as though professor Commons' observations or his thesis was more true in the negative sense then and more true in the positive sense today, about the Supreme Court. Then it was shaping our system in a much more negative way than it is today.

Altmeyer: That's right. He and Brandeis thought pretty much alike--that the way to change the attitude of the Supreme Court was to gather the facts of life, whether it was the hazards of mine work or night work for women or child labor or workmen's compensation made necessary because of industrial accidents generally. His idea and Brandeis' idea was (in the famous Oregon eight-hour law: Brandeis put it to work in the preparation of an economic brief)--were the same. So Commons was an activist besides being a wide-ranging theorist. He was an activist in both shaping legislation and in assembling facts to change the attitudes of the courts. He was also a pragmatist in the sense that he would make adjustments in any program he was working on to seek to arrive at some consensus, so that something would happen, some progress would be made. That's the way I would sum up Commons and his life.

Q: Speaking of Brandeis and Commons in the same breath, what relationship was there between the two? How much was either one influenced by the other, and what sort of personal relations were there--do you know?

Altmeyer: I don't recall there were any long sustained personal relationships. I don't think offhand of any specific occasion where they met, and I don't even know whether they corresponded with each other, but I would be very much surprised if they didn't keep in touch with each other throughout those years.

Q: They seemed to have a great deal in common both in their outlook and in the things that they supported publicly.

Altmeyer: And of course Brandeis' daughter Elizabeth Brandeis, came out to Wisconsin to study under Commons, so that I'm sure there were close relationships throughout the years.

Q: Can you relate any personal anecdotes relating to your association with John R. Commons?

Altmeyer: Oh, yes. But those are decades in my life on which I couldn't do a good job of reciting significant anecdotes. This particular health insurance survey that I mentioned was typical. He didn't realize how much he was asking a person to do. I was his research assistant on a one-fourth time basis. I couldn't live on the $400 which was the stipend, and so I got a job at the state capitol, and then I was taking a heavy schedule of graduate work all at the same time. Then he would say, "Art, I've got this request for a report. Do you think you could get something together?"

Q: In your spare time?

Altmeyer: Yes. And he told me at the end of the year that he was horrified to learn I wasn't his full-time assistant. He thought I was hired to be his full-time assistant. He was completely oblivious to monetary considerations of any kind and to the demands he was making. He wasn't a demanding man. But when he would drawl out (he had a habit of tapping his teeth) at some seminar some suggestion that so-and-so might make a report on so-and-so, it might involve just endless hours of work, but it never occurred to him that he might be overloading the man terrifically. But that's why he was such an effective leader. He never demanded anything of anybody. He'd raise these challenging ideas and suggestions that you just felt impelled to take up to make a contribution. Sometimes he'd forget that he'd asked you to do something, and you never had an occasion to present the distilled wisdom that you had accumulated.

Q: Do you know whether John R. Commons was one of the founders of the American Association of Labor Legislation?

Altmeyer: Yes, he was.

Q: It's my impression that during the first year or so at least of the life of the Association, it was in Wisconsin.

Altmeyer: That's right.

Q: And then moved to New York later on.

Altmeyer: That's right.

Q: And how about the health insurance movement in particular, other than this one study which you actually did the work on, can you recall any other specific involvement on his part?

Altmeyer: No. No, I don't think there was after that.

Q: It would be fair to say in general that although he was interested in health insurance, this was only one of many things he was involved in at that time.

Altmeyer: That's right.

Q: Perhaps we could turn then to the Committee on Economic Security, if you've finished talking about Commons. I have felt that the decision to appoint Frances Perkins chairman of the Committee on Economic Security was an important one in terms of the work of the committee. I wonder if you could shed any more light on how that appointment was made.

Altmeyer: Well, I think the reason he appointed Francis Perkins was because she had been working with Roosevelt as Governor, in the field of unemployment insurance particularly. She had been appointed by Al Smith originally to be a member of what was known as the Industrial Board, which heard appeals on workmen's compensation, and then later she was made Industrial Commissioner by Roosevelt in 1928 when he became Governor. So she was familiar with the field of workmen's compensations as a form of social insurance. She was also familiar with the work we were doing out in Wisconsin in the development of unemployment insurance and she interested Roosevelt in proposing at Salt Lake (she drafted the speech) at the Governors' Conference unemployment insurance on a state basis, or it might have been a state compact basis--I forget which.

Q: What would have been the Governors' Conference about when--1931 or '32?

Altmeyer: Some such time, when the Depression was on and people were talking about ways and means of preventing a similar Depression in the future, or at least alleviating the effects.

While Miss Perkins was often called a welfare worker, she was really more a settlement worker. She had this experience and knowledge of labor legislation, and unemployment insurance was considered then a form of labor legislation. When she became Secretary of Labor, she continued to urge the President to support unemployment insurance. The first draft, as you know, was the Wagner-Lewis bill, which he supported at her insistence. So when it was decided to let that ride until the next session of Congress, it was perfectly natural that Miss Perkins, who had suggested it, would develop this executive order for a Cabinet committee to study not only unemployment insurance but social insurance generally and report back to the President and to Congress.

Q: In the case of Harry Hopkins, by contrast.

Altmeyer: Well, he was the Emergency Relief Director. That was the only, but very important, relationship he had with Roosevelt prior to his becoming the President. Before that he'd done some Red Cross work. So he was not as conversant as Miss Perkins was with labor legislation and unemployment insurance. And I stress unemployment insurance because that was the first form of Social Security that attracted the attention of the President.

Q: Because it was the biggest problem.

Altmeyer: That was the biggest problem. He was one of the first governors to come out for old age pensions, but they were vague in their minds then about what they meant by old age pensions. Usually what they meant was a pension paid out of general revenues with some kind of an income test.

Q: This would have been a federal pension or state?

Altmeyer: State. Before the decision upholding the constitutionality of the Social Security Act, there was no thought that the federal government could possibly pass such legislation constitutionally. The emergency relief legislation was passed under a different provision of the Constitution, which didn't involve the same constitutional questions. It just meant appropriating money to relieve distress. And there was no individual citizen with any standing in court to even question the power of Congress to appropriate money to relieve distress. But when it came to passing a statute creating certain rights and involving the respective sphere of constitutional authority of the states and the federal government--why, that raised completely different fundamental constitutional questions.

Q: Am I correct that also implied in this is the fact that Frances Perkins' relationship with President Roosevelt was of longer standing and a closer one at that time.

Altmeyer: It had been. But I would think that when he became President there was a closer relationship between him and Harry Hopkins than there was with Miss Perkins in the sense that Harry Hopkins had a bigger job to do of tremendous political as well as social significance.

Q: Aren't there personalities involved in this sort of thing, too, though? The question of a personal relationship developing between Roosevelt and Hopkins, a rapport and a friendship which perhaps Frances Perkins couldn't. . .

Altmeyer: Yes. Being a woman, of course she couldn't establish that sort of relationship. But since they had known each other even when he was a Senator, there was a closeness. They had known each other since the 'teens.

Q: What I'm driving at here is that at least at that time, although things changed later on, Frances Perkins was still a close and trusted person apart from the fact that she was also the leading advocate for social insurance at that time within the administration.

Altmeyer: Yes. That's right.

Q: I wonder, moving on, if we could discuss your own involvement in all of this. Perhaps you could shed a little more light on how you came to be chosen as Assistant Secretary.

Altmeyer: Well, I first came down to Washington after Miss Perkins became Secretary to work on some internal administrative problems in the Department. One was the development of the United States Employment Service and how it should be put into operation. And then she asked me to be her representative as Labor Compliance Officer in the National Recovery Administration, to see that the provisions of the codes were enforced. Now, the reason she asked me to do this is that she and I had had contact with each other because we were both administering labor laws in our respective states, and I had seen her at conferences from time to time; but more fundamentally she had great admiration for what was called the Wisconsin Idea, which of course the people in Wisconsin and I personally think was part of this whole reform movement in the United States beginning way back perhaps in Populist times and through the first Roosevelt administration, the Wilson administration and then FDR's administration. It was all of a piece. But Wisconsin was probably the leading light or at least one of the two or three states that had gone farthest in social legislation, particularly labor legislation.

Q: The so-called Progressive movement at the turn of the century and the early part of the century is integral with this Wisconsin group.

Altmeyer: That 's right. But the Progressive movement grew out of the Populist movement.

Q: Am I correct, though, that unlike the Populists, the Progressive movement also had a very strong center in New York--that a strong strain of Progressivism developed there that in the '30s came to Washington with Roosevelt.

Altmeyer: They didn't call themselves Progressives.

Q: No. I mean it was not a Progressive party but it was part of what has been labeled the progressive movement.

Altmeyer: Well, I don't know. I could answer it this way: If you take a look at the kind of legislation that was being passed in New York and Wisconsin, you'll find that the two states parallel each other in the kind of labor legislation, for example, that was passed. Almost identical, even to the year that they passed minimum wage and hours and legislation for women and workmen's compensation. So undoubtedly there were the same sort of people in New York; and California, Colorado and Ohio were other states that seemed to have the same ideas and the same kind of people working at them.

Q: So, at any rate, getting back to our question there, one thing naturally led to another, I take it, as far as your own relation to Secretary Perkins was concerned.

Altmeyer: Yes.

Q: Can you recall the specific incidents surrounding your appointment? Can you recall when and how you were approached to become Assistant Secretary?

Altmeyer: Well, I had been doing these odd jobs for Miss Perkins, but I had been spending so much time in Washington because in addition to that I was representing the state of Wisconsin in getting grants from the Federal Emergency Relief Administration for providing unemployment relief out in Wisconsin. For a time I was on leave of absence from my job as Secretary of the Wisconsin Industrial Commission, but I decided in the spring of 1934 maybe around June that I'd better get back to Wisconsin, so I proceeded to cut my ties. I think I must have discussed with her that I felt I had to go back, and later I stopped in to say goodbye but she was out. But I no more than got back to Wisconsin when she sent me a telegram either asking me to come back to Washington or actually offering me the job of Assistant Secretary of Labor--I forget which. But, at any rate, she finally made up her mind; I learned later she was not always decisive. She hated sometimes to make a decision, especially if it wasn't necessary. What was the use? I was doing what she wanted me to do and that was that. And in this case it was complicated by the fact that she hated to dismiss a Republican appointee of long standing who was Assistant Secretary of Labor. She couldn't bring herself to ask him to resign. She asked me, for instance, if I'd mind if he stayed on a few months longer when he would reach retirement age. She was very solicitous of feelings, his welfare. That's all I recall.

Q: But, at and rate, the telegram brought you back to Washington.

Altmeyer: That's right and I resigned my job in Wisconsin.

Q: Perhaps then we could discuss the work of the Committee on Economic Security a little bit further. Were you aware beforehand--you and Secretary Perkins--of how antagonistic the AMA leadership would be to Drs. Sydenstricker and Falk. Or did this come as a surprise to you? And am I correct that the opposition to the medical advisory committee seemed to be focused on these two individuals?

Altmeyer: If it hadn't been Sydenstricker and Falk, it might have been somebody else that they would focus on. What came as a surprise was that the AMA leadership was so strongly antagonistic to the idea of considering a health insurance program. That's what came I think as a surprise to me personally, and I think to the Committee generally, although Harry Hopkins, who had been closely associated with Dr. Kingsbury, probably knew that there was suspicion or at least reservations or the possibility of opposition, but it was never discussed prior to the appointment of Sydenstricker and Falk. As a matter of fact, Sydenstricker was suggested by Hopkins first to be the executive director. But I think I raised the question that he'd been so largely confined to the field of health that he wouldn't have the competence to cover the broader field, and secondly he was in very poor health and I don't think he would have accepted the job anyway if he'd been offered it. I suggested Witte. He seemed to be the more logical choice. But, at that time I'm sure there wasn't any discussion that the AMA would be opposed to Sydenstricker, and then Sydenstricker of course knew about Falk and his work. So that's how the two of them happened to come in.

Q: Am I correct that the AMA also seemed to be antagonistic to these too individuals in particular?

Altmeyer: Well, they were antagonistic to the Millbank Foundation, which had started some research work on medical economics.

Q: I have a theory on this, that it all went back to the Committee on the Costs of Medical Care. These two men were associated very strongly with that?

Altmeyer: I think so, yes.

Q: My impression about the voluminous report or series of reports published by them was that the AMA seemed to respond to that as a declaration of war, because it really did call for a revolution in the practice of medicine--in the way it was to be financed and organized. From that point on they were extremely hostile to the individuals who had been concerned with it.

Altmeyer: That's right. I don't think I was particularly sensitive to any of that. As I say, I think probably Harry Hopkins was and maybe Miss Perkins, but it didn't come up in connection with the hiring of those two men, and I think we were surprised at how strongly the AMA felt about even studying the question. But still up to the time of the report all of us, including the President thought there was a good chance of getting acceptance of a limited form of health insurance. So we couldn't have felt that it was absolutely hopeless.

Q: Yes. Related to that, Roosevelt apparently was reluctant to antagonize the AMA when they objected so strongly to the men on the medical staff. Ed Witte in his book describes a meeting at the White House. This came to the President's attention and, as he put it, the President took a personal interest in this matter and there was a meeting with leaders of the AMA, including I think Dr. Cushing, and after that they took a much more cooperative attitude toward the work of the medical advisory committee. Am I correct that Roosevelt's reluctance to antagonize the AMA was something that was unexpected?

Altmeyer: No, I don't think you should put it that way. When we saw what we were headed into, we didn't need any caution from the President to take it easy and watch our step. So I wouldn't say he was any more reluctant that we were to antagonize the AMA.

Q: Some correspondence relating to that period refers to "certain commitments" made by Mr. Witte to the AMA.

Altmeyer: I don't know of any commitments that were made except that there be full consultation and they be given a chance to make their final report.

Q: That's undoubtedly what was meant.

Altmeyer: That's the only commitment that I know of. But it was made clear to them in the report of the committee that the committee was committed to recommending health insurance. We listed all the principles that we felt should be included in a health insurance program but said we weren't prepared to submit a specific legislative proposal. So I don't think there could have been any commitments that we would pull our punches.

Q: Is it true that President Roosevelt became somewhat piqued by the amount of internal quarreling that developed within the Committee on Economic Security, primarily on the unemployment insurance issue?

Altmeyer: I don't know that he did.

Q: There was no pressure from the President to try to resolve these things quickly in order to prevent critics from making use of them?

Altmeyer: No, I think it was a battle of the intellectuals that was played up by Louis Stark particularly. I don't think the President knew what it was all about, except he was certainly clear from the very beginning that it ought to be a federal-state program, not a national program. There never was any question in his mind about that. So if he felt that issue was at stake, he would have made it clear. I guess we did go to him with the question, to be reassured that he still felt that the federal-state approach was the one that we ought to follow. That's as far as his interests extended there. What disturbed him was this disagreement with Morgenthau on the financing of the old age insurance program. That he could understand, or at least thought he could understand, and he didn't want to spend any money out of the general treasury. It ought to be on a self-sustaining basis. He could understand that. And he was very definite in support of Morgenthau, and we had to change our report at the eleventh hour, almost the twelfth hour.

Q: One reason that has been given why health insurance was not included in the original economic security bill was that Frances Perkins strongly opposed including it for fear that it would jeopardize the rest of the bill and that she was perhaps the most strongly committed to this point of view and the principal advocate of this point of view before the President.

Altmeyer: I think by the time we came to the point of making our recommendations, we realized the better part of valor was to go along with this idea of merely stating the principles. As chairman she would naturally have most influence, but I don't recall that even Miss Roche or Mr. Hopkins urged inclusion. I think there was pretty general agreement on just what the strategy should be.

Q: This does raise a further question. I have the impression that Harry Hopkins was more favorably inclined toward health insurance, as a former Red Cross man, because of his previous experiences with these problems which made him more sensitive to them perhaps and tended to give them more a sense of priority.

Altmeyer: Yes, I think that's true. And, furthermore, he wasn't thoroughly sold on unemployment insurance as a solution to the problem of unemployment. He was for a work program, a standing long-range work program with a shelf of public works ready to be carried out whenever there was any recession in the economy. And if he was interested in any form of social insurance, it was health insurance. Furthermore, besides the Red Cross, he'd been in the T.B. association, too. And Kingsbury was a close friend of his, so there's no question that Hopkins was more interested in health insurance than anyone else on the Cabinet committee.

Q: But when it came down to the crucial questions of whether or not health insurance should be included in the bill, Hopkins, too, saw the wisdom of not undertaking that.

Altmeyer: Yes.

Q: Some letters that I've seen relating to the world of the medical advisory committee seem to refer to a specific proposal for health insurance that was brought up and discussed. Is this impression correct, that there were specific proposals that were under discussion, though none of them ever reached the stage of being drafted into bill form?

Altmeyer: I think so. I think this so-called catastrophe type of insurance with cash benefits rather than medical service was discussed, although Falk and the technical experts didn't like the idea at all, and I don't think even that approach seemed to appeal to the AMA sufficiently to push it forward. With the reluctance on the part of the experts and the reluctance on the part of the AMA, no specific proposal ever came to the point of being accepted. The staff members were still hoping that they'd get at least agreement on certain principles, if not on specific legislation, then on a basis of agreement on certain principles.

Then they took the other tack at one time: "Well, now, we know you don't agree to these specific proposals, but tell us how they could be improved even if you wouldn't accept them in any possible form." Well, the AMA didn't want to get caught in that sort of approach. It was rather unrealistic to ask them to develop something that they'd find a harder time opposing as unworkable when all their suggestions for improvement had been accepted. So none of these approaches to the medical advisory committee ever got anywhere.

Q: I take it, though, that in general, as has been true through out the whole history of this debate, more than one possible alternative was suggested, that various possible ways of dealing with the problem were under consideration at that time.

Altmeyer: Yes.

Q: Perhaps we could move on then. I'd like to turn to the 1937-'38 advisory council. Was health insurance discussed at that time, and if not, why was it excluded, both from the advisory council and from the 1939 amendments?

Altmeyer: Well, that's very obvious why it was excluded because this advisory council grew out of the resolution proposed by Vandenberg to study this problem of the huge reserve under old age benefits. I broadened out the proposal to include not only the problem of how to handle the reserve, keep it from growing so big and make it actuarially acceptable to the critics by saying, "Well, we must study of course the benefit side as well as the cost side."

Q: We were talking about the mandate of the advisory council.

Altmeyer: It was all directed towards the old age benefits plan. You couldn't very well bring in health insurance anymore than you could bring in unemployment insurance. That's why it was excluded from both the advisory council report and from the 1939 amendments. In making our recommendations, maybe you mean why didn't we include it, because we covered not only old age benefits but we covered public assistance. Some of the public assistance amendments, too, were very important ones.

Q: Also, weren't the '39 amendments the first time that standards were imposed on the states in unemployment insurance in the administration of unemployment insurance benefits?

Altmeyer: No, we never did get any standards except personnel, and that was true of public assistance, too.

Q: So that other things besides old age or the trust fund ?....

Altmeyer: So far as the council is concerned, its terms of reference could only be directed towards the old age insurance. But the amendments included other things, and conceivably they could have included unemployment insurance and health insurance, but we were more concerned about getting the old age insurance system started earlier and on a more comprehensive basis, including dependents and survivors, than we were in anything else. We did want to straighten out this business of civil service or merit system for employees in the states, and we also wanted to clear up the question of whether need was the basis that the states must observe in providing public assistance. But there wasn't any thought of having a broad Social Security program submitted to Congress. We wanted to get this old age insurance program fixed up first.

Q: The implication of this decision seems to be--or at least one interpretation might be made from the standpoint of the historian or the layman--that in 1939 or in 1938 when the amendments were perhaps first being drafted, it recognized that health insurance was still an extremely controversial and sensitive issue. And just as in 1935 it was felt unwise to jeopardize more basic and more important priority items by attaching a controversial issue like health insurance--in 1939 it was decided to keep it as a separate but parallel effort.

Altmeyer: That's right. No question about it.

Q: That is my impression. So at the same time the amendments were being considered by the advisory council and then being drafted, you also had the technical committee on medical care doing its work and the national health conference and finally the Wagner bill being introduced.

Altmeyer: That's right.

Q: Was Franklin Roosevelt involved in the decision to exclude any reference to studies of health insurance or the health care issue in the original Social Security Act?

Altmeyer: No.

Q: And what about the interdepartmental committee and under that the technical committee on medical care? Was he consulted on both of these and did he support both of these efforts?

Altmeyer: Yes.

Q: Do you know whether the American Medical Association made any efforts to block either of these efforts with the President? Did they intervene?

Altmeyer: Not that I know of. He was delighted to hear how well the 1938 health conference came out. That wasn't a White House conference, incidentally.

Q: It was just a national health conference.

Altmeyer: National conference on health.

Q: Who was considered the sponsoring agency--the interdepartmental committee?

Altmeyer: The interdepartmental committee.

Q: Is it true that Dr. Parrin was cool to or opposed the interdepartmental committee and also the National Health Conference?

Altmeyer: That's right. But when he saw how well it went so far as public attention was concerned and support, he changed his mind and made a radio talk saying that health insurance was just over the horizon.

Q: How do you explain his change of position?

Altmeyer: He was a cautious man. He had a definite health program he wanted to advance, and he didn't want to jeopardize that by getting the AMA excited about a new program like health insurance. After all, he was surgeon-general. It's perfectly understandable that you don't want to jeopardize existing programs and progress when you don't think there's much chance of a new program getting off the ground.

Q: Yes. And as far as you're concerned, he didn't obstruct in any way the interdepartmental committee of the National Health Conference. They participated...

Altmeyer: No, no. They participated very actively on that technical committee, the people from the Public Health Service, in the preparation of that report.

Q: Could you perhaps describe Miss Roche for me and in general the role that she played in these events?

Altmeyer: Well, she had a long previous record of involvement in social reform and felt very strongly that the government ought to take affirmative action in all this welfare field. We would personally have gone much further than the committee proposed to go. Practically every program discussed, she would have had the federal government take not only the lead, but the sole responsibility--for unemployment insurance, for example--but she was also very loyal and also had great confidence in me, I think, and was willing to accept our judgment that we had to make haste more slowly. So she never pressed for more drastic action, although we knew she felt that we were going too slowly and perhaps too timidly.

Q: What was the purpose of the 1938 National Health Conference, and I wonder what your assessment is of its accomplishments?

Altmeyer: Well, the purpose was to focus attention on a broad health program, and we knew very well that health insurance would be the one feature that would get the most opposition, which it did. But it was very successful from the standpoint of attracting public attention and public support. And the AMA was moved to propose to the committee that it would accept all of the proposals except the health insurance one--if we would drop that.

Q: This was privately or a public statement.

Altmeyer: No, privately. Miss Roche and I were present and I think probably other members of the interdepartmental committee were present. I think it was on the Sunday following the National Health Conference.

Q: This was a meeting between you and representatives of the AMA.

Altmeyer: That's right.

Q: Who would have represented the AMA there? Fishbein?

Altmeyer: I don't think Fishbein was there because he had been so outspoken. I think his own crowd felt that he would not be a person who would get anywhere with the government representatives because he had antagonized them so much with the violence of his attacks. But I don't remember who from the AMA were there. There was a five-point program that the technical committee and the interdepartmental committee had proposed, and they would accept four out of the five, they said.

Q: Was this a meeting that they suggested?

Altmeyer: Yes.

Q: Can you recall now where it was held?

Altmeyer: No, I can't.

Q: But it would have been here in Washington?

Altmeyer: That's right. And they weren't offering us anything, because we felt we could get our four points anyway, and I don't think they opposed them. We got legislation eventually--the hospital construction program and so on. It took time, but I don't think that they actively opposed any of the other points except the health insurance. So there was really no quid pro quo involved from our standpoint.

Q: Do you know whether the AMA made any attempts to try to prevent the National Health Conference from being held?

Altmeyer: No, I don't think they did.

Q: The impression one has of the events of this entire period--and I'm referring now to the National Health Survey in 1935 and '36, the appointment of a technical committee and the issuance of its report in '37 or early 1938 when it was finally approved, and then the National Health Conference in '38--seemed to be part of what Edwin Witte in some correspondence back '35 said was necessary in preparation for the presentation of a health insurance bill, an educational process. All those things seemed to be part of that educational process. It seemed to be loading up to the presentation of a program, and yet the President didn't present his own program to Congress in 1939. Instead there was a Wagner bill. And before we turned on the tape, I mentioned this correspondence that I had seen from Dr. Falk to Dr. Eliot. I wonder if you could explain for me exactly what happened there, why there wasn't an administration program.

Altmeyer: I don't know what was in the mind the President except that he didn't think the time was ripe to press for health insurance.

Q: He let you go ahead with all of the preliminary buildup...

Altmeyer: That's right. He was very enthusiastic when we told him about the National Health Conference and the support that was given it in the press and by the representatives of various groups there. He was so impressed that I remember very distinctly he said, "We'll make that an issue this fall in the campaigns." That was an off-year. But he no more than said that before he said, "No, I think it would be better to wait for a Presidential year," which would have been 1940. Whether he was thinking of running in 1940 for a third term, and whether he thought this would be a vote getter, I don't know. But at any rate, he didn't think that it was just the right time to shoot the works. Of course by the time 1939 rolled around, World War II had started and he was completely involved in that from the very beginning. All this domestic reform became secondary.

Q: Were further attempts made to interest the President in this?

Altmeyer: Yes, there's no question that we asked him specifically what he would support, what was practical to support, and he said a limited hospital construction program, grants in aid to the states, but that was all. But he helped Wagner prepare his bill, which included more than that. We all testified in favor of it. But it didn't arouse any interest. It never was reported out of the committee. The chairman said that they would continue to pursue the matter, but it languished in committee.

Q: Was there anything in the nature of a trial balloon involved in the Wagner bill of 1939?

Altmeyer: Yes, I think so--not so much by the President because he had only said he'd go along with hospital construction but I think he said he wouldn't oppose Wagner introducing a bill that went further. I think he probably thought, "Well, that would be testing sentiments." But I think frankly that we, the people who had been working the hardest, rather agreed that it didn't look as though we'd get very far with the legislation, unless it was made a very dramatic issue by the President. And when the President didn't want to do it, we rather lost heart; we felt that it was going to have to wait until he was ready to give it a push.

Q: This of course involves the kind of questions that political scientists like to ask about the importance of Presidential support for a piece of controversial and major legislation.

Altmeyer: It's absolutely essential.

Q: And it was your conviction that this could never be enacted without the support of the President?

Altmeyer: That's right.

Q: Was the introduction of theWagner bill in 1939 something that you and the Social Security Board were deeply involved in?

Altmeyer: I was personally. The Board as a whole was not because the Board at that time hadn't taken a position of health insurance, but I, as a member of the interdepartmental committee, felt that I could, and I testified in favor of it. I don't think the Board members objected. I'm sure they didn't. But the hearings attracted very little attention. You could see that nothing was going to happen.

Q: There was a recent account of these events, which we were talking about earlier, and in it there's a story that Roosevelt first endorsed the Wagner bill and then withdrew his support. Does this accord with your recollections?

Altmeyer: No, it doesn't. It may be that what was meant was that he was enthusiastic about health insurance when he talked with him after the health conference and then cooled off. But so far as the Wagner bill itself was concerned, he never specifically endorsed it. He acquiesced in its introduction, but he made it clear to us that all he would really support would be this small hospital construction program.

Q: Did you discuss the question with him again in 1940 when the election was looming--sound him out again on the question of health insurance?

Altmeyer: I'm quite sure we did not. The war had started, and I think it was self-evident that there was no use in trying to get his attention for any important social legislation.

Q: By that time the mobilization had already begun.

Altmeyer: Yes.

Q: Perhaps we could turn to page two and some of these other questions. I wonder if you could discuss from your experience some of the ways in which a new government agency, specifically the Social Security Board in its early days, goes about building support for itself.

Altmeyer: Well, it goes to those people who are members or leaders of groups whose support is necessary and consults with them at every possible opportunity. For instance, I spent a great deal of time with labor leaders, and I attended many of the meetings of the Business Advisory Council of the Department of Commerce to discuss the developments in the way we were administering Social Security, and members of the staff had many many meetings with the staff members of labor and management groups. Then of course, likewise, in the case of the state agencies we had many, many meetings with the state welfare and the state unemployment insurance agencies. With the state welfare agencies we were able to develop a great deal of unanimity in everything we were doing. There might be one or two dissidents.

I mean so far as general policies were concerned. But when it came down to the question of specific rules and regulations, there was the usual objection that developed over the Federal government trying to tell us how to run things, and there had to be discussions as to why it was necessary and so on, and you never completely reconciled your views on that sort of thing. But nevertheless consultation is the prime instrumentality that you use to get support. And so when it came to legislation, we could always rely upon the welfare agencies to support whatever legislation we desired. That was not true of unemployment insurance because there was not a community of interest there. We had come to feel that there had to be legislation, that the state agencies who were under the influence of employers' groups, for the most part, just could not accept it. They might as technical people or administrative people accept them, but they would tell you that they could not because their governor wasn't in favor. They identified themselves with the governor and the state groups consciously or unconsciously. That's perfectly natural.

Q: How about with the Congress?

Altmeyer: Yes, with the Congress it's very essential that you get to know and talk with leading members of the legislative committees and the appropriations committees, both; and on very intimate terms. If you don't, you're sunk. You might just as well go home.

Q: I have the impression that social insurance is a set of concepts which needs to be explained to be understood. It takes a certain amount of education or self-education or learning through interaction with other people who understand it, to appreciate the values of social insurance, in preference to welfare. Am I correct that one of the principal tasks that you had in the early days was to educate the Congressmen, the key Congressmen, in particular, about what social insurance was and in what ways it was preferable.

Altmeyer: Well, yes. The Congressmen were beset by those old age pension groups, for example, and many of them were committed. Many of them signed discharge petitions to bring out bills for flat pensions paid out of general funds. You couldn't convince a large proportion of them that insurance was a good idea. From a political standpoint they had these groups on their neck. They represented important blocs of votes, and no matter how desirable contributory social insurance might be in the long run, nevertheless they had to respond to immediate pressures. But you'd always find some leaders in key positions who recognized the dangers of the general pension approach, and that you had to have something that was self-regulating, so to speak so that the revenues would be coming in to meet the expenditures. Well, we were fortunate that the committees with which we had to deal were money-minded committees.

Otherwise we would have had a flat general pension. There's no question about that. And so I found it rather easy to convince the key legislative committees--Ways and Means and the Senate Finance Committee--that contributory social insurance was the only safe kind of a system that we could adopt.

Q: It's been said many times that social insurance is a more conservative approach, in the best sense of the word, and this is one specific way in which it manifested itself.

Altmeyer: That's right. There's no question about it. It is conservative. A flat general pension system is essentially a very radical and alien concept in a competitive society with differential incomes and with differential incomes as the main motive force in stimulating maximum contribution to the gross national product.

Q: And also in a society that places a premium on self-reliance.

Altmeyer: That's right. A flat general pension as a means for the immediate alleviation of mass poverty has a great, but I think superficial, appeal. From the standpoint of fitting in to the rest of our economic system it is very hard to justify. This approach still continues to be a very much debated question in the form of a negative income tax. The income tax is respectable. What could be fairer? But concealed in that is the question of what do you intend to accomplish? If it's to give a guaranteed annual income, why not do it and be done with it instead of conceal it, wrap it up in a false label? Secondly, do you intend to give out a certain sum of money on a per capita basis regardless of other income that the person has or don't you? If you intend to take into account his other income, then you are really befuddling the issue because what you're saying is you're for public assistance on an income test basis, a simplified income test basis, an income test basis that you may think is superior to the kind that's being applied now, but nevertheless an income test. So there are these fundamental questions. If you're for a distribution of the gross national product on a per capita basis, that is certainly a radical proposal. If you're for a guaranteed annual income, taking into account other income that the individual has, then you're back where you started with a means test or an income test. And so in between these two extremes is contributory social insurance which says, "Yes, you can have other income and we won't take it into account and you will get these benefits regardless, but the benefits will be related to what your income has been in the past" on the two assumptions that your income in the past indicates how much you have contributed and how much you lose when you're not working. It assumes that the past income of the individual contributed to the gross national product and specifically to the fund out of which benefits are to be paid; and secondly, how much his loss is when he ceases to be an active producer. So what I say is that social insurance steers a course between Scylla and Charybdis, the Scylla of a per capita redistribution of the national income regardless of income and a glorified income test disguised as you will by calling it a negative income test. That is a difficult concept to get across. I think even my friend Lampman, who is so strong for a negative income tax, out in Wisconsin, doesn't really comprehend what he's talking about.

Q: At any rate, to conclude on this question we were dealing with, getting these concepts across and the social and economic effects of the different kinds of systems you're setting up, or alternatives that might be available, was one of the principal tasks in the early days.

Altmeyer: Well, you have to go where the power is and get the support of the labor and management and any other groups which have influence so far as the success of legislative development is concerned; and you have to establish a working relationship with the key committees of Congress. The third thing is you have to educate the general public as to what this thing is all about--the recipients of the benefits, have to know what their rights are, what the advantages are or you're sunk. And, that's a hard task to try to work through the unions to educate their members and so on, to try to get out a story through one media or another, you make speeches to civic groups as well as to those power groups--you do everything possible.

One dramatic illustration of how you get support was in this 1936 Presidential campaign when there was this issue as to whether you'd junk the old age benefits, now called old age insurance, because it was a fraud and a hoax according to the Republican candidate. He was thinking about this reserve, there's an awful lot of confusion still in the minds of people as to whether the reserve is a good or bad thing. Well, we had 50 million copies of a little pamphlet, just a little folder, written in what the New Yorker called "the purest English that any federal bureaucrat had been able to master." It was written by a woman in our public relations department.

Well, we had 50 million printed. We weren't going to get into the campaign but when the attack started we had those all at various points out throughout the country ready to distribute later when we were going to have people sign up for an account number. But we immediately turned the 50 million over to labor organizations and they distributed them at factory gates and to their members and so on.

I think that played a key role in the election. They first had their attention attracted by the attacks. They wanted to know what the hell this was about. They got a notice in their pay envelopes saying that "beginning January 1st you are going to have your pay docked one per cent whether you like it or not," with no mention made of benefits. Well, of course, they got excited about that. But then when they got the other side of the story, what they were going to get out of it, this attack backfired completely because their attention had been attracted by the attack and their fears allayed by the explanation that they got.

So you have three problems--educating the general public, working with power groups and working with leaders of Congress if you're going to get anywhere.

Q: Would you say that there's a fourth one that is probably self-evident? And that is: you have to make a success of the operation; it's got to be a going concern; it's got to be free of scandal; it's got to be administratively sound.

Altmeyer: Oh, of course. I take that for granted--that administration is the law in action and most of my book is devoted to how we honed the administrative machinery so that it functioned effectively and gave the impression (and I think the actuality) of fairness and concern. And, I think that was basically why it was successful. Of course we wouldn't have gotten to first base if people weren't convinced that these human beings they met in the offices throughout the country, of old age insurance, were really concerned about their getting their benefits.

Q: And this paid dividends in the end in the attitude of Congress toward Social Security? They were inclined to be sympathetic...

Altmeyer: Oh, yes. That blue check they get every month, and nobody asks them what their income is. I see the distribution here in this plush apartment. Nobody thinks they're being demeaned by getting that check and I think they look forward to it. If they're very rich, they probably turn it over to their wife so she can go and do something with it that she wouldn't have done otherwise. And everybody's happy, happy as a lark.

Q: You don't know too many people who have refused to accept their benefits?

Altmeyer: I don't know any. The ones who are the most virulent are the ones that finally say, "Hell, I've paid for this. I'm going to take it."

Q: What would you say were the political effects of the 1939 amendments both for the Roosevelt administration and for the Social Security Administration?

Altmeyer: If they hadn't gone through, we'd have been dead ducks. There's no question that the Townsend movement would have carried the day. But we got started and I think we were helped perhaps by the fact that the war came along. Otherwise, even with the 1939 amendments, some of these radical proposals might have gained momentum--you can't tell--because we really didn't start demonstrating the effectiveness of old age benefits--what everybody thinks of as Social Security--until after the 1950 amendments you see.

There was a whole decade there that the benefits didn't amount to a damn. They were so small compared with the rising wages, and with full employment, who was worrying about it? All the old folks could get work. Even Grandma could get work during the war. So it didn't have to prove itself during the war years. But without the 1939 amendments there would have been a vacuum at that point where we might have gotten some legislation. But when the full impact of the war came along, as I say, I don't think any social measures could have gotten attention, whether they were good or bad.

Q: But recalling your emotions and the pressures that you felt were upon you at that time, and upon the principal people involved in this, the Townsend movement was breathing down your necks; and this was one of the factors involved in that.

Altmeyer: Yes.

Q: That's very interesting. I wonder if I could ask you a few questions relating to the origins and the development of the health insurance proposal for beneficiaries. I think we could skip that because we did discuss that before.

Altmeyer: We didn't discuss it on the record, though.

Q: No, but it is mentioned in your book. The origins are there and perhaps we would just be repeating what was in the book. I think perhaps, though, we could usefully talk about the period just after the war. At that time, in 1947, Oscar Ewing came to the Federal Security Agency. I wonder first of all could you describe him for me as a personality and what is your assessment of his effectiveness as an advocate for national health insurance?

Altmeyer: Well, let's expand your question a little further and talk about him as an administrator as well as an advocate of health insurance. He came in after the Federal Security Agency had been in existence for ten years and it had continued to be a holding company. Maybe you could call it a holding operation. The constituent units, like the Social Security Board and the United States Public Health Service, operated as they had always operated as entities. That was because Paul McNutt and his successor, Watson Miller, were kindly people--I guess had confidence in their subordinate administrators and saw no particular reason to change things.

Well, Mr. Ewing had never had any experience in government and he came in as an appointee of President Truman and displaced Watson Miller, who was moved over to be head of the Immigration and Naturalization Service. Watson was very sad because he loved his associates and he was interested in the field of the work of the Federal Security Agency.

Mr. Ewing was quite a different personality from his predecessors. He believed that the Federal Security Administrator had the authority and the responsibility for actions taken throughout the agency, and therefore he should be apprised of them and should play a part in the decisions. Well, that's easier said than done if you have a vast organization. The only actions that came to his attention were actions when there was a backfire of some kind, an unfavorable reaction. If things went well, why of course he never heard about the actions taken. So he got the feeling more and more that these guys down there were keeping things from him and doing things that were wrong and reflecting on him as an administrator, and so he insisted upon tighter control and being kept more informed, but it was impossible to keep him informed of everything that was coming up and the actions taken--absolutely impossible. But he never could understand that. And so the relationships were not as good between him and the heads or the constituent units as they had been. I think his predecessors probably were too permissive and inactive, and Mr. Ewing the opposite. Well, so much for that.

The reason I mention that is: when it came to legislation, his feeling that he had authority and responsibility--and he did; there's no question about it, he was right. This meant that instead of the Surgeon-General and the Chairman of the Social Security Board developing a program and going up on the Hill to explain it and push it, he was going to be the one who would develop a program, depending upon--I'm sure he would say--his subordinates to give him technical advice. But he would make all the decisions as to what went into the legislation, and he would be the one to interpret it and he would be the one to push it. He felt that in that regard he was far superior to any of his subordinates because he was a politician that knew how to talk with politicians, and whether he knew anything about administration, he did know everything there was to be known about political action.

Well, when he came in he was very enthusiastic to prove that he was going to make this a more vital agency of government, both in its present programs and in new programs; and he was going to push the President's programs in the field of health and educational welfare to the hilt. He was the President's man. So he really got going great guns and we shivered as regards health insurance because we felt that there were many shoals there and that the ship of state had to be steered pretty carefully to avoid them. And he soon discovered that it wasn't as easy to steer the ship as it looked from a distance. Then when things seemed not to be going so fast as he would have liked to see them go, he adopted a somewhat more cautious approach, but it was too late. He had already been earmarked as a devil incarnate as regards health insurance. That was a particular thing that seemed to attract his attention, his enthusiasm. He really did put an awful lot of work into that.

Q: Did this reflect President Truman's enthusiasm? Or do you think this was something where Truman was permissive of the initiatives that came from Ewing?

Altmeyer: I think Mr. Ewing felt that the President himself was enthusiastic, had his heart and soul wrapped up in it. As a matter of fact, I think the President depended on Sam Rosenman for the legislation that he proposed in the field of health and educational welfare. Sam Rosenman was the one that I worked with directly, and Wilbur Cohen spent most of his time over at the White House, half of his time--I would say--working with Sam Rosenman for a great many months. And the President had great confidence in Sam Rosenman. Then being a man who once he's proposed something and supported it, he must go through come hell or high water, that was Harry Truman for you. He wasn't going to let any AMA tell him where to get off at; he was going to tell them. And so Oscar Ewing thought that he had a loyal supporter in the administration, and I think he felt, at the beginning at any rate, that it was a political vehicle, a vehicle that would carry him to high office, ever the Presidency itself.

Q: That was mentioned in '52.

Altmeyer: Yes. And I think he was completely mistaken, but nevertheless I think that was in the back of his mind.

Q: He couldn't have been more wrong. My impression is that toward the end he was very much on the defensive, that he was a very unpopular figure and a symbol of socialism and radical schemes which most American people were not inclined toward at that point in history.

Altmeyer: I don't think they were radical myself.

Q: But that was the impression that was successfully...

Altmeyer: The AMA was the one most responsible for creating that impression, and they certainly put it across.

Q: Exactly. So that he, by carrying the flag, he wanted a target--they were shooting at him. What's your impression or recollection of him personally? How would you describe his personality?

Altmeyer: It's very difficult for me to say because I don't think we ever had a hot argument or bitter disagreement, and I know he used me to solve administrative problems and personnel problems outside of my field. For example, he was having trouble with Studebaker, who was commissioner of education and with Mrs. Swofford who was chairman of the United States Employees Compensation Board. He had confidence in my trying to straighten out administrative matters and to solve headaches for him, and so he'd ask me to do various things on his behalf. He was very difficult in the sense that, as I say, he was very sensitive to criticism and he felt that something was wrong when he hadn't been told of some circumstance that blew up--whether it was in some state where we'd had to tell a state official that he couldn't do this, he couldn't do that. Then his governor would write to Oscar Ewing who would demand, "Why in hell didn't I know about this?" That made him very suspicious and very irascible at times. So that's about the sum and substance. I had disagreements with him, but they were always pleasantly discussed and we never came to feel that we had a feud on. But I can't say that he was an easy man to work with.

Q: Regarding the Wagner-Murray-Dingell bill, it's my impression that by the 1950 elections, many Democratic candidates had begun to shy away from ruling on this particular issue and that this was even more true in 1952 when Governor Stevenson was running for the Presidency. Am I correct that this was a very strong indication of the declining political support for national health insurance?

Altmeyer: Yes, there's no question about it. Mr. Stevenson didn't want to touch it with a ten-foot pole, either in '52 or '56.

Q: I take it that this, among other things, was what started you searching about for other proposals that might be more acceptable, including what is now called Medicare. I think this brings me to the question of the origins of that proposal, back in 1950 or '51, and I wonder if you could recount for me your recollection of how this evolved and was finally introduced.

Altmeyer: Well, it was a revival of an older proposal that we had made in 1942 of providing health benefits to the beneficiaries of old age and survivors' insurance or rather the ones insured under old age and survivors' insurance. We said in our annual report for the fiscal year ended June 30th, 1951, that the great gap was failure to provide protection against the cost of medical care, and we specifically recommended that hospitalization benefits be provided for workers and their dependents who had already become eligible for monthly cash benefits under the old age and survivors' insurance system. In 1942 the Social Security Board had recommended hospital benefits for persons insured under the old age and survivors' insurance system. We were limiting it in two ways--limiting it to hospital benefits and then originally to those insured under old age and survivors' insurance, which was not the total population by any means in 1942. But when it came to 1951 we had narrowed it still further so that it was only the actual recipients of cash benefits that would be eligible for hospital benefits.

Q: The blind, the retired, the . . .

Altmeyer: Those that were actually drawing cash benefits, those retired because of disability or old age or in the case of those who had died, their widows and orphans. But we still wanted to include not only the old folks but the dependents and survivors as well.

Q: But the principal beneficiaries would have been the old folks.

Altmeyer: That's right. But we didn't get any attention. Now, I think that we mentioned this to Mr. Ewing, and proposed a further limitation. We said, "You could start even with a smaller per diem cash benefit, not the actual cost of hospitalization, the cost of the room or the services rendered but a small per diem cash benefit of five to ten dollars." In those days of course the rates were much lower in hospitals. Then you wouldn't raise any questions in the minds of either the hospitals or doctors that you were doing anything but providing a supplementary cash allowance to help people who were hospitalized. That's the way we presented it to Mr. Ewing.

Q: But they would have to be in the hospital to qualify for these benefits.

Altmeyer: Oh, yes. But, it would be a diem payment for the days they were in the hospital--frankly just a partial payment. But we recognized the hospitals would say, "Well, a lot of these people are going to say, Well, that's supposed to be all that your room is worth. Why should I have to pay you anything more?" But my recollection is we mentioned this to Mr. Ewing as the ultimate in receding to the simplest and crudest form. That was after Mr. Ewing called a National Health Assembly on May 1948 and the attacks had become quite virulent, so it looked as though you couldn't get anything approaching a comprehensive health insurance program.

Q: This would have been about 1950 or so?

Altmeyer: It might have been earlier than that. That conference was held in '48, I think, and it might have been even in '49 when it was apparent...

Q: There was a Presidential election that intervened. Truman won that upset victory. And one had the impression that after that, Truman felt he had a mandate for all kinds of things.

Altmeyer: That's right. There was a period of a few months there where light seemed to have blazed again from the firmament and all was going to be wonderful. But that was short-lived, and it was when the sag came that I think we said, "Well, here's something you might rescue from the wreckage."

Q: Am I correct that the proposal to create a Cabinet department for health, education and Social Security (it had various names, but that seemed to be one of the most prominent) came to be a test of strength on the national health insurance issue. The AMA apparently became involved in this as an opponent, and the failure to get that tended to dampen the spirits of those who were hoping for success of health insurance.

Altmeyer: Yes. The strange thing was that Taft was the one who proposed a department of health, and he didn't get anywhere with it. He was quite an interesting man even though he was quite antagonistic to Ewing. But the AMA wouldn't go along with the Taft proposal.

Q: Getting back to the origin of the 1951 bill for health insurance for beneficiaries, where you approached Oscar Ewing with this suggestion, I take it that at first you didn't get any response from him.

Altmeyer: I don't recall. I just recall that Wilbur Cohen and I talked about it and thought we ought to suggest this to him. But I don't recall what conversations we had.

Q: I think maybe we could turn then to the latter part of the '50s. You participated in the work of the Democratic advisory committee during that period. I wonder if you could describe for me in genera1 what that work consisted of.

Altmeyer: Well, there were three or four months of intensive work with a group to develop a Social Security program--pretty much what we'd been recommending all the years that I'd been in office.

Q: Including health insurance?

Altmeyer: Including health insurance, yes.

Q: And in what way did this relate...?

Altmeyer: I think the way we expressed it in the report was that we ought to at least provide benefits for the beneficiaries under old age and survivors' insurance but that eventually nothing short of a comprehensive health insurance would meet the full need.

Q: I wonder if you could describe for me what involvement you had in the events leading up to the introduction of the Forand bill in 1957. Were you involved in the discussions that took place informally over a period of several months?

Altmeyer: No. I think probably Elizabeth Wickenden, who was very active, probably talked with me from time to time; but I don't have any clear recollection.

Q: But the questions of timing and strategy and the scope of the bill and so on...

Altmeyer: No. It was carrying out the idea that we proposed back in '51 really except that they focused on the old folks. I never felt very happy about that. I thought it was a mistake to leave out the widows and orphans and the disabled. I think they could have gotten the works, and I think they will get the rest of them in a matter of a year or so now that Medicare seems to be going along so well.

Q: This does not necessarily imply that you think it unwise to have so presented the bill that it was the problem of the aged that you dealt with.

Altmeyer: No, I think that probably was good strategy, but I wasn't in office then so I was bolder in thinking what could be done. If I were in office I guess I would have said, "We'll start with the old folks. "

Q: My last two questions are rather broad, political science questions, I think. First of all, I wonder if you have any thoughts about what you conceive to have been the basic issue or issues underlying the Medicare fight and of course this involves us, too, in its predecessor, the Wagner-Murray-Dingell episode. Or perhaps you see different issues involved in the two cases, I don't know.

Altmeyer: I don't know what you mean by "issues."

Q: What were the things being fought over? What underlay the AMA's position?

Altmeyer: Well, I think the AMA said one thing but really were concerned about another thing, although I wouldn't say that was true of all individuals and I wouldn't say that consciously they realized it. They were saying it interfered with the relationship between the doctor and his patient, that the government laymen were breaking down their relationship--you could not practice effective medicine and get maximum results, maintain the confidence of your patient and all that, if you were going to have a third party mixing into that relationship. Now, I think that's a valid worry, and it must be taken into account. But I think their main concern was that the government would control the rates of pay and affect their incomes as a consequence that they would be looked upon more and more as servants rather than as independent practitioners of the art of medicine, not only making all these professional decisions, as they should, but also making decisions as to how much they should charge this or that patient. I think the more successful they were, the higher their income, the leaders of the profession, in other words, the more keenly they felt and these two ideas all mixed up in their own minds and never disentangled them really. So I think they were sincere men who mixed up two quite different issues--one valid, the other I think invalid. I think that the government has the responsibility of breaking down the economic barrier that separates a human being from necessary medical care. That is the fundamental responsibility of government. It certainly is as fundamental as breaking down the economic barrier that separates human beings from getting an education. The government is going to prevail. There's no question about it.

But now the second thing--its effect upon professional relationships: the government also has responsibility there for seeing that the organization of medicine is at the optimum; that there aren't too many hospitals here and not enough there, to see that hospitals cooperate in the use of expensive equipment and perhaps specialize in the treatment of cases, one hospital specializing in one kind of case, where it's a smaller community where a hospital can't have all of the services.

Q: In general, the word "efficiency" applies.

Altmeyer: Efficiency. And, that applies also to the distribution of doctors. Why are they all congregated in the urban centers and the rural areas can't get them? It's ridiculous. The government has to get the optimum use out of scarce materials and out of scarce personnel. And I think the government then also has the obligation to make those materials and the personnel more plentiful. The doctors have always wanted to maintain a scarcity--whether they put it in those terms or not; I'm sure they don't. But when the deans of medical schools almost unanimously have been crying for federal grants all these years, the AMA has opposed them and it has opposed student loans when there are a lot of youngsters that could have been trained for the medical profession and we wouldn't have this scarcity we have today. I think we can go a long way to satisfy the doctors about the protection of the professional aspects if they will also recognize the responsibility of the government not only to take care of the economic aspects but also to exercise some influence on the proportioning of resources, medical resources to the maximum advantage of the American people.

Q: My last question regards the general question of enacting major pieces of legislation. I wonder whether you feel there are any preconditions that must, as a matter of course, be fulfilled before such a major piece or legislation can be enacted into law. Is there any kind of checklist of prerequisites in your mind?

Altmeyer: Just the things I've mentioned about working with influential groups. But basic to everything, you shouldn't get social legislation unless there's a felt need on the part of the American people. Why should you try to shove something down their throats that they don't think they need?

Q: Are you referring to the Wagner-Murray-Dingell bill by any chance?

Altmeyer: No, I wasn't. But, I would say that's true of any legislation; that you cannot and should not have social legislation before you are sure that there's a felt need. And, if you as a better informed person feel there is a real need that is not properly appreciated, it's your job to propagandize, if you want to use a nasty word, to see that there is sufficient felt need before you go for legislation. Otherwise you're not going to get the legislation anyway and you won't get the support for the legislation if you do get it on the statute books.

Q: Well, regarding the Wagner-Murray-Dingell bill, do you think that's an example of a case where despite all the propagandizing it didn't come across as a felt need?

Altmeyer: I think fundamentally the felt need was not felt strongly enough to overcome the concentrated and focused opposition of the vested interests who saw a danger in it.

Q: People responded more to the danger than to the need.

Altmeyer: I think the Congressmen did. I think that if the labor organizations, for example, had done a better job so that some groups that felt strongly that this is necessary, you might have had a chance to get the legislation. But you can't in a democracy get it unless there's a strong enough feeling of the necessity. And even though there is a pervasive feeling, if it's diffused and not directed or is uninformed as to what to do about it; and on the other hand, you have a very sharply focused position effectively operating on individual Congressmen and Senators who are supposed to be the representatives of the people but react to felt pressures; you just don't get anywhere.

Q: Speaking of labor's role, Nelson Cruikshank has said that as far as he was concerned, national health insurance was not one of labor's priority goals during that period in the later '40s and early '50. They were much concerned with such problems as the Taft-Hartley Act and basic organizing problems.