State Assistance Plans Are Little Help

Old-Time Trail Driver, Crystal City, TX, 1939
Old man who lived alone. His home and food were furnished by the town.  Library of Congress: America from the Great Depression to World War II Black-and-White Photographs from the FSA-OWI, 1935-1945

By 1928, just prior to the start of the Great Depression, only 6 states and territories had old-age assistance laws. As the Depression deepened, that number increased, until there were 28 states and 2 territories (Alaska and Hawaii) with old-age assistance programs by 1934, most just enacted in the prior year or two. Unfortunately, the plans were quite limited, and inconsistent from state to state. As summarized in the final report of the Old Age Security Staff to Chairman Witte, the state plans included the following features and restrictions: 

• All but Arizona and Hawaii refused to make payments to older people who had children or relatives who could support them.
• Most limited assistance to elderly people who were age 65 or older, but quite a few set the limit even higher, at age 75.
• Most required that beneficiaries must have been citizens and residents of the state for 15 years, some had even longer residency requirements than that.
• Many required that the beneficiary must transfer to the pension authority any property they possessed before any payment would be made.
• Most had property and income caps to limit eligibility, generally a maximum of $3,000 in property and $300-$365 a year in income.
• Most required that benefits would be denied to anyone who gave away property in order to qualify for public assistance.
• Most required that a lien be placed on the estate of the beneficiary to be collected upon their death.
• Most required that recipients be "deserving", and benefits were denied to anyone who deserted a spouse, failed to support their families, had committed any crime, or had been a tramp or beggar.
• Benefits were denied to inmates of jails, prisons, infirmaries, and insane asylums, although a few permitted the payment of assistance for inmates of a benevolent fraternal institution.
• Most set a cap on monthly payments at $30 a month, although they actually paid about half of that, or $15 a month on average.

The restrictions were so severe and the number of states that actually had launched their plans and committed funds to them were so limited that even in 1935, in the depths of the Depression, there were less than 200,000 people covered under state old-age assistance plans. (Old Age Security Staff Report, 1934)