Research Notes & Special Studies by the Historian's Office

Research Note #23
Luther Gulick Memorandum re: Famous FDR Quote

Franklin Roosevelt made a famous remark about the Social Security payroll tax, to the effect that he designed Social Security to use a payroll tax so "no damn politician can ever scrap my social security program." The quote is well-known and much-used, but its origins have been somewhat unclear.

This quote was published for the first time in 1958 in volume 2 of the first edition of Arthur Schlesinger Jr.’s history of the presidency of Franklin Roosevelt (The Coming of the New Deal). Unfortunately, Schlesinger’s original commentary on this created some confusion, as he talked about several separate topics in the same paragraph, and in the sourcing footnote he cites five sources to the various topics, without making clear which citation is to which topic. (Cf. The Coming of the New Deal, pg. 308-309.) Since Rexford Tugwell and Frances Perkins were also mentioned in the same paragraph, some scholars assumed the quote was being attributed to one of them. But in fact, the quote comes from Luther Gulick. The memorandum reproduced in full below is the source document for this quotation. It is a "memorandum for the file" written by Gulick sometime in the summer of 1941. A copy of the Gulick memo is in the FDR Presidential Library in Hyde Park, NY and this reproduction is courtesy of the FDR Library.

The memorandum is largely self-explanatory.

Luther Gulick


Who Was Luther Gulick?

Luther Gulick was not an important New Deal figure. In fact, he had no official position in the Roosevelt Administration, other than as an appointee to ad-hoc advisory groups like the one referred to in the memorandum.

Gulick was an expert on public adminstration, and he was one of the founders of the American Society for Public Administration, serving as its fourth president. In the 1940s, Gulick famously defined public administration as POSDCORD: planning, organizing, staffing, directing, coordinating, reporting and budgeting. Many years later--in 1990, at the age of 98--he would put it more simply: ". . . the global content of the field of public administration is set by the environment, not by logic; if government does it, it is 'public administration'."

Gulick had previously served the Roosevelt Administration as a member of the Brownlow Commission on government organization in 1936-37.



Beginning in June, 1941, I was working in the Treasury organizing the study of federal, state, and local government fiscal relations. My colleagues for this project were Harold Groves of Wiscosin, Mabel Newcomer of Vasser, and Clarence Heer of North Carolina—though Heer later withdrew from the staff and served only as a special advisor. The result of our work was published under the title, “Federal, State and Local Government Fiscal Relations," as Senate Document 69 of the 78th Congress, First Session.

As part of the study, Harold Groves and I came to the conlusion that federal enactment of a retail sales tax might prove to be a highly useful revenue producer, and at the same time something of a brake on the then mounting inflation. We also thought that a federal enactment would prevent the further spread of state legislation and that this would mean the possibility of repealing the retail sales tax at a later point in the economic cycle when counter deflationary measures might be required. Henry Morganthau showed no interest in the proosals and repeated all of the regular arguments on the sales tax ignoring the fiscal policy considerations arising at a time of high incomes and commodity shortage. I, therefore, discussed the problem with FDR when he asked me how I was coming with the Treasury study. He said to go ahead and explore the idea with Harold Smith, Marriner Eccles, and others.

In the course of this discussion I raised the question of the ultimate abandonment the pay roll taxes in connection with old age security and unemployment relief in the event of another period of depression. I suggested that it had been a mistake to levy these taxes in the 1930’s when the social security program was orgiginally adopted. FDR said, “I guess you’re right on the economics. They are politics all the way through. We put those pay roll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program. Those taxes aren’t a matter of economics, they’re straight politics.”

FDR also mentioned the psychological effect of contributions in destroying the “relief attitude.”

Larry DeWitt
SSA Historian's Office
July 21, 2005