country and I want a temporary ticket. I got a temporary ticket, worked 4 weeks, and got my regular ticket. Now I work in the Commodore and the other hotels."

He said, “What I like better is being on room service." He gets $6 a day charged as salary and all the tips. He picked up $9 in tips by carrying martinis up to a room of four people. It dropped to two people, and finally to the man and Herman himself. He is married for the second time and has two children under age and collects social security for them, a total of $254 a month.

Senator CLARK. I do not think this is typical-I think this is an extraordinary example of American initiative.

Mr. SARGENT. This man said to me, "I don't see why anybody has any trouble getting along."

Senator RANDOLPH. I want to agree with Senator Clark about the nature of this example. The poet Longfellow once said: "Age is opportunity no less than youth itself, though in another dress."

Mr. SARGENT. I am recommending a basic change in the "Limitations on earnings" requirement of social security after social security benefit payments start, and in my prepared statement I have charts detailing the workings of my plan.

Senator CLARK. How about the cost, Mr. Sargent?

ECONOMIC REASONS FOR NOT RETIRING

Mr. SARGENT. I would like to develop two things: 1,200,000-or 1,400,000 it must be by now, are drawing no benefits from social security. They are working. Age 69 is the age at which the average man applies for social security. Three and a half or four out of five people are working for employers where there are no pension plans to add to social security.

If the man cannot live on social security he is not going to quit until he has to. He has to work until he has to quit and then he lives on social security.

If four out of five people are in that category, I think that explains ages 69. If those people working now are earning $2,500 I would give them a little supplement to feather into the 72 status where he can have it all. I would give him a little supplement. We would pay him about $700 social security.

If this man is one of our men who went out at 65, and at 66 took a job at $2,500 I would give him that same little supplement so he would only lose $500, which difference he would lose by earning more. As nearly as I can figure I think the added cost for this 1,300,000 or 1,400,000 people drawing no benefits will be between $300 million and $400 million a year.

It is anybody's guess how many of those people who are now drawing full benefits would be encouraged to go back to work if there was an incentive to go back.

Senator CLARK. I am not enough of a statistician to know what $400 million would mean in terms of increased rates of social security.

Mr. SARGENT. If 30 percent of this group who are now drawing full benefits were encouraged to go back to work, part time, full time, and would take less social security, then social security would save money, estimated $225 to $250 million.

EXAMPLE OF CONSOLIDATED EDISON PLAN

Let me give you one illustration in my own company. This is the simplest arithmetic, the simplest arithmetic in the world.

We have a mechanic who makes $5,800 a year. He comes up to age 65. We are going to pay him a pension and he is going to get social security and if his wife is 62 she will collect. If this man retires there is going to be $1,700 from us and $1,900 from social security paid to him.

If he continues to work, we do not pay the $1,700 and social security does not pay its benefits, so there is a saving for social security.

We have had 35 percent of our people elect to continue work in the last year and a half.

I talked to a hundred of our people who elected to continue work. I said, "Why did you stay? Was it the money? What was the reason?".

Forty percent of them gave a reason that was really money and 60 percent gave a nonfinancial reason for electing to continue, "I wouldn't know what to do with myself," they said, "all my friends are here," "the job is rather easy anyway," "I am getting along."

I asked them, "If we had retired you at 65, how hard would you have tried to get a job?"

Very few would have. If we retired them they would just have let it go and taken their retirement and gone along.

ATTEMPTS TO CHANGE 65 AS MANDATORY RETIREMENT AGE

For the last 5 or 7 years, I have been trying to persuade employers who run the companies to change this fixed retirement at 65. In 1954, the National Industrial Conference Board issued a report that 5 percent of 327 companies let people work beyond 65. Ninety-five percent of their list retired people at 65.

We made a survey recently through the National Committee on the Aging, of 150 companies, big ones, and we found nearly 15 percent have 65 voluntary, with a higher age mandatory. So around 15 percent of the big employers we surveyed do not have fixed retirement at age 65. I think that number must be about double what it was 5 years ago. I know, for example, that the American Cyanamid Co. changed their plan recently as we have changed our plan.

If companies let people who are competent and who want to work, work beyond 65, this change in social security would be less necessary, because the man who wanted work would do so, and when he had to quit he would be quitting because of disability or inability to keep up.

Until more companies let competent people work beyond 65 I think an incentive to these fellows who can work and need to work and want to work will be very helpful in reducing the problem of the old people and reducing the number of people who are pushed out.

In terms of numbers, we hire 1,000 people a year. This year, out of 500 aged 65, 150 stayed on. If we had not held over these people we might have had to hire 1,150 people. This number of holdovers is not seriously blocking the employment of younger people.

Your suggestion of giving them slightly more if they work another year, I think this is good, I think it is in the right direction, but would a man stay and work another year if his social security went from $116 to $121? I don't think it is much of an incentive.

Senator CLARK. I think there is a lot of sense in what you say, Mr. Sargent, and I agree with you that my bill on a 1-year basis would not be particularly effective. But if he worked until 72 he would get 28 percent more, and I think that is quite a lot of pay.

Mr. SARGENT. That is quite a lot. I think it is in the right direction. I would like to see some of this idea worked into it.

Senator CLARK. If your thinking is sound fiscally, so this would not really cost the Government anything, it seems to me it is a very important contribution.

Mr. SARGENT. I think it would add $300 million or $400 million and take off $250 million and might cost $150 million.

Senator CLARK. Is this something which a trained statistician, a trained pension plan statistician could compute the cost of with any accuracy or would we have to take a gamble on it?

Mr. SARGENT. I think a gamble. I talked to Dr. Ginzberg about it. If you made the social security thing an incentive plan, how can we find out how many people would go back to work?

You would have to talk to them. I talked to a hundred of our people and found 16 of our people that we were satisfied would want to do more if this went on. I had hoped it would be 30 percent, and only found 16 percent. "Does your

Dr. Ginzberg said it is one of those "iffy" questions? "Does sister like cheese?" "I have not got a sister." "If you had a sister,

would she like cheese?"

I think I can get 100 companies who have fixed retirement policies at age 65 to interview people between 65 and 69, explain some kind of incentive plan, and come up with an evaluation. "This man would try hard if you took the penalty away and this man would not." This would give us some idea.

Senator CLARK. Have you taken the health factor into consideration at all?

Mr. SARGENT. I am just working on the lucky ones, who are able to work and want to work.

Senator CLARK. You think that would be well over 1 million?

Mr. SARGENT. There are 1,400,000 drawing full benefits. Some can work. Some don't want to work. But certainly half of them could go back.

Senator CLARK. You do not think the health disability is higher than that?.

Mr. SARGENT. I don't know. We have got a 68 age now. We held over a few people prior to this formal plan and we retired three people this year at 68 who were doing excellent work. They said, "I'd like to continue." We said, "68 is as far as we have gone so far."

There are several things that can be done in addition. Somebody spoke of a minimum in social security. That would add to the cost of what I am talking about. Somebody said there ought to be a cost-ofliving allowance in there. I am scared to death of that because I think the spiral would keep going. I would rather see Congress take care of that as the need comes up and not write it in.

My whole pitch is that if we let people work who want to work they will continue to be assets, producers, better consumers, and taxpayers, and if you push them out on retirement or penalize them if they do work, they continue to be liabilities.

43350-59-pt. 1-10

Thank you.

Senator CLARK. Thank you very much, Mr. Sargent, for a most helpful contribution.

Senator RANDOLPH. May I ask one question?

Senator CLARK. Go right ahead, Senator Randolph.

Senator RANDOLPH. Does your suggestion for incentives to employment conflict with what we have heard from Dr. Kuplan?

I believe he said that employment for those over 65 or 70 is not a realistic prospect on which to base a social policy.

Mr. SARGENT. I can only talk from New York's experience. Our people have been offered jobs and turned them down because they said "I am not going to work for $20 a week. I am not going to take a job at $80 a week and only end up with $20 a week."

Our people have been offered jobs-and can get jobs if they go after them, part time and some full time. Maybe California is different, or a lot of people go there because of the climate.

Mr. KUPLAN. Not that different.

Mr. SARGENT. I think our unemployment situation is better. If people want a job around our town, they can get a job. I tried to find a man for a job for a hospital in Newfoundland, $6,000 a year; they needed somebody with a stationary engineer's license. We went out to 12 foremen who had worked for us. None of them wanted to go. "It is a new life. I don't want to go to Newfoundland." Sometimes we are disappointed.

Senator CLARK. Any further questions?

Mr. KUPLAN. It seems to me that anyway we are oversimplifying some of this discussion, but I have seen in contacts I have had with older people that they are eager to retire and get their social security but within a month they are the sorriest people on earth. They find they have lost their usefulness and contact with former employees. I wonder how much of that experience you have run into?

Mr. SARGENT. Let me say this: About 18 or 20 companies reported to me that nearly 50 percent of their workers, given a choice, are continuing work beyond 65.

If more companies allowed more people to make a choice, I think more people would stay on.

Mr. KUPLAN. I would agree with you on that.

Senator CLARK. We want to have a little discussion from the panel, but first I would like to call Mr. John Ruskowski, of the New York State Joint Legislative Committee on Problems of the Aging, who, I understand, has a statement he would like to file.

STATEMENT OF JOHN RUSKOWSKI, REPRESENTATIVE OF THE NEW YORK STATE JOINT LEGISLATIVE COMMITTEE ON PROBLEMS OF THE AGING

Mr. RUSKOWSKI. I represent the New York State Joint Legislative Committee on Problems of the Aging and I request just a minute of your time because we have a suggestion that we consider important, that the date of the White House Conference now scheduled for January 1961 be deferred until May of 1961, and we ask the leadership of your subcommittee in bringing this change about.

I have a news release statement prepared by the chairman of the New York State Joint Legislative Committee on Problems of the Aging, and I will not take your time reading the whole thing.

I would like to give you the essence of his arguments for the change which he hopes will come about from January to May.

The statement says that the President will be leaving office a few weeks after the date for which the conference is now scheduled. I understand it is to be from January 9 to January 13, in 1961.

The statement says the lame-duck nature of the leadership will be apparent and the Cabinet officers will probably be on their way out. Senator CLARK. Mr. Ruskowski, you need go no further. Always quit when you are ahead.

We will have your news release filed for the record.

Mr. RUSKOWSKI. We would like to file it for the record, if we may. Senator CLARK. Yes, indeed.

Thank you very much, Mr. Ruskowski.

(The news release referred to follows:)

NEWS RELEASE BY ASSEMBLYMAN JOHN E. JOHNSON, CHAIRMAN, NEW YORK STATE JOINT LEGISLATIVE COMMITTEE ON PROBLEMS OF THE AGING

WASHINGTON, D.C., June 17.—An appeal to Congress to move up the date of the White House Conference on Aging from January to May 1961, was made this morning (Wednesday) by the New York State Joint Legislative Committee on Problems of the Aging, Assemblyman John E. Johnson (chairman) disclosed. Assemblyman Johnson (Republican of Le Roy, N.Y.) urged at a hearing of the U.S. Senate Subcommittee on Aging and Aged, headed by Senator Pat McNamara (Democrat of Michigan), enactment of legislation to defer the White House Conference on Aging from January to May 1961, as "the first order of business for Congress to help the aged."

Assemblyman Johnson, in a prepared statement, said:

"1. The President will be leaving office a few weeks after the date for which the Conference is now scheduled.

"2. The lame-duck nature of the leadership will be apparent.

"3. The Cabinet officers will probably be on their way out.

"4. The prestige of a White House Conference held just before the White House gets a new occupant will be seriously diminished.

"5. The President will be put in the awkward position of sponsoring a meeting to set national policy which he will be unavailable to administer. "6. The fresh enthusiasm of a new President holding his first White House Conference could be obtained if the meeting were moved up by Congress to May.

"7. The new President would then be able to have his own Cabinet carry out the policy of the Conference.

"The aged will do better," Assemblyman Johnson said, "if the Conference is moved up to May 1961. Congressional legislation set the date of the Conference for early January, but this is a highly unfortunate choice. We'll be getting leadership from hold-over appointees who may be leaving office.

"Congress has an obligation to the elderly to make the Conference a highly potent agency for determining national policy for a decade to come.

"To have lame-duck, handicapped leadership could mean a 'sad sack' conclusion to a Conference to which localities all over the Nation are looking forward eagerly for setting a national direction in efforts in behalf of the aged. "Deferment of the White House Conference from early January to May 1961 should be the first order of business by Congress to help the aged.

"As head of the first legislative agency in America to deal with the diverse problems of the elderly, I strongly suggest that haste in this instance may make for waste."

Senator RANDOLPH. I do not want to delay matters, but I ask another question.