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Dr. ALEXANDER. Generally; yes, sir.

In view of the foregoing, we respectfully request of your committee the same consideration be given our denominational employees, all of them employees of nonprofit organizations, as is now accorded in the bill to members of religious orders. We ask for them continued exemption from the coverage of the Federal Social Security Act.

Senator KERR. What wording would you suggest, there, Doctor, to achieve that?

Dr. ALEXANDER. Pardon me. I did not understand you, Senator Kerr.

Senator KERR. Well, you quoted the language, back here, of H. R. 6000— all services excluded under present law are covered except services performed by

(1) ministers and members of religious orders Dr. ALEXANDER. Yes, sir.

Senator KERR. Could not language be added there which would add the change which you seek!

Dr. ALEXANDER. I think it could. Frankly, I didn't know that was within my province, and I haven't attempted to frame it in words.

Senator KERR. Well, I did not ask you to. I asked you if it could be done.

Dr. ALEXANDER. Yes, it could.

If, in the wisdom of this committee, such a blanket exemption cannot be made, we then ask the same consideration for our group now given in the bill to State and local government employees. Such a provision would not make it mandatory upon the employee to participate under Federal social security; if, within a given group, the majority voted to continue participation through their denominational retirement board.

Scores of the heads of our various institutions throughout the Southland have expressed their convictions with regard to this matter, and their desires, in telegrams and letters to their respective Senators, including certain of you gentlemen. So also have the State secretaries, who, in their respective States, are the accepted leaders of our denominational work. The statements of this latter group I shall not read, but they are included here for the record. I bring these remarks to a close by calling your attention to two telegrams only, the first one appended below, received from the president of the Southern Baptist Convention and the other one from the executive secretary of the executive committee of the Southern Baptist Convention.

Then, gentlemen, on several pages that follow are telegrams from the State secretaries representing the various States of the Southern Baptist Convention. I have tried to be brief, and I shall be happy to answer any questions you may wish to ask further.

The CHAIRMAN. Are there any questions?

Senator Taft. I would like to ask this: I suppose that the fundamental objection which you make to this would apply just as much to any proposal that an employee be given the option to go under either, in which case the employer would be under a compulsory requirement to deduct for the purposes of the Act.

Dr. ALEXANDER. That is true, Senator Taft.

Senator TAFT. You would still object to such an alternative proposal?

Dr. ALEXANDER. We offer the alternative if the first suggestion cannot meet with the approval of the committee and be approved by the Senate. We offer the second as an alternative.

Senator Taft. It appears to me that while your plan is probably better, it probably is not so advantageous to a man. It depends on just what we do when we pass this law. Also, the question of transferring from your employment to other employment arises. A man may want to feel that he can do that. I am very much opposed, myself, to abolishing any of these funds or making everybody come under the other plan, but it does seem to me there is a problem there.

Dr. ALEXANDER. You mean the problem of an employee who goes back and forth?

Senator Taft. The problem of an employee who goes back and forth from covered to noncovered occupations and who may want to take the social-security provisions.

Dr. ALEXANDER. I will be perfectly frank with you. As we see it, that is the only advantage Federal Social Security has to offer anybody; that is, anybody already covered in some retirement plan. They can move around at will from one type of service to another.

Senator Tart. Do you transfer with any other funds at all, or do you work out any plan by which credits can be transferred?

Dr. ALEXANDER. We transfer, of course, only within the denomination, but we give to the individual a certain, shall I say, “paid up as of a given date” standing under certain circumstances, if he is going into secular work. And from that point on they have social-security coverage.

Senator Tart. And how far is your plan actuarially sound? Dr. ALEXANDER. That depends on the plan. We operate 12 in all. The major plan, of course, for the ordained minister is something that we are not considering here, anyway. We are thinking mainly here of the plans that cover all of our employees, the Baptist schools, hospitals, orphanages, State boards, and such groups as that, and all of the lay employees, men and women.

Senator TAFT. And do you build up a fund? How far do they provide funds?

Dr. ALEXANDER. These plans that I am referring to in the main are fully funded.

Senator Taft. You invest the proceeds in securities?
Dr. ALEXANDER. Yes, sir.

Senator KERR. Do you invest in securities, or make contracts with insurance companies !

Dr. ALEXANDER. No. Our funds are all invested in securities, the affairs of the Board are audited, and they are subject to the approval of the denomination.

Senator KERR. And is any of that paid on separation? If he goes out after 10 years, does he get that reimbursed?

Dr. ALEXANDER. It does depend upon the plan. There are one or two of the older plans where he does not receive all he should, and we are hoping to be able to amend them very shortly. In the newer, later plans, he does receive full credit.

Senator TAFT. And then what about credits for past service! Are those paid up in any way? Or are the premiums supposed to be sufficient to make that up!

Dr. ALEXANDER. They are only partially funded.
Senator KERR. They are partially funded?
Dr. ALEXANDER. That is right; for the past service credits.
Senator KERR. By payments from time to time?

Dr. ALEXANDER. They are being more fully funded with the passing years, but they are not fully funded yet, nor will they be for some years to come.

Senator KERR. But you are working toward that?
Dr. ALEXANDER. Yes.

The CHAIRMAN. Are there any survival benefits provided, Doctor, to the worker?

Dr. ALEXANDER. Yes. There are no death benefits as such, as a lump sum. We have widows' benefits and orphans' benefits.

The CHAIRMAN. In other words, if the worker passes away almost immediately on retirement, or after retirement, but before he received a return of the benefits that you guarantee or stipulate, you do provide for survivor insurance or insurance to his wife, to his children?

Dr. ALEXANDER. Yes, sir. They never receive, under any circumstances, less than his personal payments with compound interest through the years, and in most of our plans a portion, a percentage, up to the full employer contribution. It depends upon the type of the plan.

Senator Taft. One other question, Dr. Alexander. This exemption that now exists in the law is an exemption of all charitable institutions; and, of course, there may be many employers that are not covered at all and whose employees are therefore not covered in any way. Would you consider the possible exemption of so-called existing plans, or something of that kind, rather than the complete exemption, here?

Dr. ALEXANDER. Yes, sir. Senator Taft. You think that might be a possible method of handling the situation?

Dr. ALEXANDER. I think so. I am not going into it at all, though, because, as I say, speaking for the great denomination I represent, we have a plan for everybody. That is a problem for the others to work out.

Senator KERR. You have a twofold objection, as I understand it, one, to its application to your denomination, and, two, to its application generally to every church denomination.

Dr. ALEXANDER. That is true.
Senator Taft. Whether they have a plan or not?
Dr. ALEXANDER. Yes, sir.
The CHAIRMAN. Senator Connally, any questions?

Senator CONNALLY. Do I understand that you mean, by that answer to Senator Kerr, that you oppose including any of these employees under social security ?

Senator KERR. Senator, as I understand it, his basic objection is to the imposition of a tax by the Government upon any church organization or denomination.

Dr. ALEXANDER. That is true.

Senator CONNALLY. That is a generality, though. I am talking about getting right down to it. Do you oppose the law requiring payments by people who are employees of a Church organization?

Dr. ALEXANDER. You are asking me for my personal opinion?

Senator CONNALLY. Well, you are testifying, you know.

Dr. ALEXANDER. Yes, sir. My personal opinion is, and also as representing the organization, that I do, that is our position in the matter.

Senator CONNALLY. Then they would be excluded!
Dr. ALEXANDER. Yes, sir.

Senator CONNALLY. And it would be up to them to either get a plan in their denomination or be out and not have any plan; is that right?

Dr. ALEXANDER. Yes, sir; that would be the present situation. It is my own opinion that there is a great advantage in what you are doing right now; whether the plan stands with the social-security provisions as they are in House bíll 6000, or whether they are amended. Because the matter is being brought home to the attention of all groups, nonprofit organizations, and you helping to bring to pass a security coverage where it does not exist at the present.

Now, speaking for my own denomination, we do have it in existence, and it has been, for about 15 years.

Did I answer your question, Senator Connally?
Senator CONNALLY. You answered it.
The CHAIRMAN. Thank you very much, Doctor.
Dr. ALEXANDER. Thank you, sir.
(The supplementary material filed by Dr. Alexander follows:)

STATEMENT BY WALTER R. ALEXANDER, EXECUTIVE SECRETARY, RELIEF AND ANNUITY

BOARD OF THE SOUTHERN BAPTIST CONVENTION

Honored Senators, before proceeding with any formal statement, permit a very sincere word of appreciation for the privilege thus extended me. That word I express for the more than 642 million members of the denomination I represent in my official capacity. I am Walter R. Alexander, executive secretary of the relief and annuity board of the Southern Baptist Convention. This denominational board has its headquarters in Dallas, Tex., by which State it was chartered as an eleemosynary institution in 1918. It is the pension board of Southern Baptists, operated by and answerable to that great Christian body. They hold membership in more than 27,000 Baptist churche:: dotting the land from Mary. land to Florida, down the Atlantic seaboard, thence westward to the Pacific coast, including California and Oregon, 22 Siates in all, and the District of Columbia,

The functions of this board are twofold. It extends relief, in the form of direct financial grants, to aged Baptist ministers and their wives, and to the widows and orphans of Baptist ministers. In so doing, it disburses denominational funds designated for the financial relief of these aged individuals who served for the most part on very modest salaries in other days before the retire. ment plans of the board had been instituted. For the past 10 to 15 years, the board has been operating retirement plans looking toward age annuities, with disability provisions, for all servants of the denomination. Its major plan is designed for the ordained ministers, pastors of churches. Into that plan, the Baptist minister pays 3 percent of his salary as dues, his church or churches contributing a like amount, these totals supplemented by denominational funds, In addition to this, the ministers' retirement plan, through which more than 11,000 Baptist preachers are participating, together with more than 12,000 Bap tist churches, our board operates other contributory retirement plans; one for the employees of all south-wide denominational boards, institutions, and agencies ; one for the employees of our Baptist orphanages; another for employees of our Baptist hospitals; another for the faculties and staffs of our Baptist schools and colleges; and still another, entitled the "Age Security Plan," designed for lay church workers. Some of these plans are on a voluntary basis, although more and more employers are now making participation mandatory upon all new employees. These plans are meeting with increasing favor and are growing rapidly in the extent of their coverage. In all, over 26,000 certificates of participation have been issued to date. Southern Baptists offer, through the board I represent, the coverage of a contributory retirement plan to every salaried em

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ployee of the denomination, without regard to race, sex, age, or type of service rendered, and whether ordained or lay.

Several times in the past years, amendments to the original Social Security Act of 1935 have been considered by the Congress. Each time, Southern Baptists, along with other great denominations of America, have urged that no amendment be passed that would, to the least degree, or in any sense, violate the American principle of the separation of church and state, contrary to the spirit of the first amendment to the Constitution of the United States. In the Southern Baptist Annual for 1940 appear these words as the expression of the Southern Baptist Convention : "Baptists believe in social security for the American people. They have advocated it for many years. Their several retirement plans are evidence of their belief in the plan of social security and of their desire to secure the application of this principle in behalf of all the workers in all the estates of the denomination, none of which are covered by the Federal Social Security Act. Baptists desire that the Government shall not amend the Social Security Act in any way that would result in an infringement upon our religious liberty We are informed that Congress does not desire to disturb the churches and church institutions by placing a tax upon them and their employees for social security; yet much pressure is being brought to bear upon the Government to extend the coverage of the Social Security Act to employees of tax-exempt agencies." The foregoing, expressed at the time the Walsh amendment was pending in the Senate, is a true expression of Southern Baptist convictions today, and remains applicable, although nearly 10 years have passed.

Up to the present time, employees of nonprofit organizations have been excluded from the coverage of the Social Security Act. To be more specific, the services excluded are those performed by “(1) employees of nonprofit organizations organized and operated exclusively for religious, charitable, scientific, literary, educational, or humane purposes, if the organization does not engage substantially in propaganda or other activities designed to influence legislation" (Social Security Revision, p. 3, hearings before the Committee on Finance, United States Senate, 81st Cong. 2d sess., on H. R. 6000—pt. I, Testimony and Recommendations by the Social Security Administration, January 17, 18, 19, and 20, 1950).

Under the bill now being considered. H. R. bill 6000 (and again I quote), “All services excluded under present law are covered except services performed by (1) ministers and members of religious orders,” etc.

Baptists have no members of religious orders, but we do have thousands of denominational servants, ordained and unordained-employees of churches, boards, institutions, and agencies. Under the terms of H. R. 6000, and as recommended by the advisory council, these would be covered automatically. This would mean (1) that, in the future, the function of providing for the economic security of employees of church, denominational organizations, and other institutions of religion would be taken away from these groups and be made the function of the State; (2) that the churches and their institutions would be taxed by the State for the support of its social-security program; (3) that the door would be open for the punitive coercion of the churches by the State in the enforcement of its regulations; and (4) it involves the individual workers of the churches in a direct economie dependence upon the State that will tend to dull religious conviction and stifle independent, conscientious action.

Baptists still believe that the church is not in the same category as the economic corporation, that it is the voice of God in the world, and that its spiritual function becomes impossible when its organization and methods are controlled by the state, or when it becomes economically dependent upon any other group whatsoever. The church must remain free from entangling alliances if it is to continue its function as the voice of God in human society.

It should be noted here that H. R. bill 6000 makes an interesting and appreciated concession. It calls for contributions by employees of nonprofit organizations on a compulsory basis, permitting contributions made by the employer to be on a voluntary basis. To many people, this provision may appear to keep well defined that line of demarcation between church and state. In its practical application, however, it remains our conviction this would not be the case. There would soon be brought to bear upon nonparticipating employers a series of pressures-pressures that would intensify rather than diminish as the years pass. The demands of employees would be one such pressure; public opinion, another; and, sooner or later, the pressure of governmental authority. Participation upon the part of the employer would cease to be voluntary, except in theory, for such pressure would become practically coercive.

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