The history of this pension fund has been perhaps the greatest scandal which has fastened upon our government. This enormous payment represents not devotion to the patriots of the Civil War, but political truckling in its smallest and most objectionable form. With this lesson before them the people of the United States have hesitated to deal at all with the question of pensions for civil servants.
Notwithstanding the unwillingness of the national government to deal with the question of civil service pensions such pensions are being widely extended amongst the large business corporations and railroads. The New York Central Railroad, the Pennsylvania Railroad, the United States Steel Corporation, and many other railroad, banking and industrial corporations have established systems of pensions for their officers and employees. An interesting type of such a system has recently been authorized for the Boston and Maine Railroad by the legislature of Massachusetts. In addition, several states of the union, the last of which is Wisconsin, have inaugurated pension systems for public school teachers, maintained in considerable part by deductions from the salary of the individual.
Before the establishment of the Carnegie Foundation, pension systems for teachers, quite limited in their provisions, were in operation in the University of California, Columbia University, Cornell University, Harvard University, McGill University and Yale University. Pension systems have since been instituted in Haverford College and for those teachers connected with Teachers College at Columbia University who do not come within the rules of the foundation. In most of these colleges the entire pension was to be paid by the institution. In some of them—as, for instance, at Cornell—the pension was to be paid in part from an endowment fund and in part from the payments of the professors.
The various pension systems thus briefly alluded to as now being in operation may be divided into two general types, the non-contributory and the contributory, and the latter type must be subdivided into two subtypes—that in which the contribution of the prospective pensioner is voluntary and that in which the contribution is compulsory. It goes without saying that the variations under these types and subtypes are endless. For example, in the compulsory contributive type contributions may be required from others than the pensioner himself. Thus, the German old-age pension system regards three parties as participating—the imperial government, the employer and the employee. The last two contribute equal amounts. In the year 1907 the contributions were as follows: