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Definition: Townsend, Francis Everett (1867 to 1960) from Chambers Dictionary of World History

US physician and reformer. In 1933 he proposed a federally administered old-age pension plan, which he believed would stimulate the economy and end the Depression. The Townsend Plan was repeatedly defeated in Congress, but its popularity helped bring about the passage of the Social Security Act (1935).

Summary Article: Townsend, Francis (1867–1960)
from The Great Depression and the New Deal: A Thematic Encyclopedia

Dr. Francis Townsend was an American physician who, during the Great Depression, put forward the “Townsend Plan,” which involved a massive injection of money into old-age pensions, which would then be spent, allowing elderly people to have an affluent retirement, and generating spending which would help the economy.

Francis Everett Townsend was born on January 13, 1867, near Fairbury, Illinois; his father was a farmer. He initially wanted to become a farmer, but was unsuccessful, and decided to train as a medical doctor instead, practicing at Black Hills, South Dakota, and serving in World War I. He became assistant health officer at Long Beach, California, and with the onset of the Great Depression, was angered by the plight of many elderly people who lived in penury. Indeed, he himself was suffering financial problems at the time, following the failure of many banks.

The scheme that Townsend planned involved all the elderly being given a pension of $200 each month, payable to everybody aged 60 or over. The cost, about $20 billion a year, could be paid for by a “turnaround tax” of 2 percent levied on each business transaction. The plan was that the people who received the pension would be required to spend all their money in 30 days. This spending would inject a large amount of money into the economy, which would then end the Depression.

Economists attacked the scheme, claiming that the “turnaround tax” would help large, vertically integrated manufacturing businesses which produced goods from raw materials to the finished product, and incur unrealistic costs on those who were involved in only a small part of the manufacturing process. However, the idea, which was first raised in a column in a Long Beach newspaper in September 1933, quickly led to the formation of a social movement. By the summer of 1935, Townsend had established an office and boasted a membership of 2.25 million people, formed together in 7,000 clubs.

Although the press and many politicians heavily attacked Townsend, he was able to form a working alliance with Reverend Charles E. Coughlin from New York, who was the leader of the National Union for Social Justice; and Louisiana Senator Huey Long, who had formed the Share Our Wealth Society. Long’s assassination in 1935 led to Townsend working with Coughlin in the latter’s Union Party, which was expected to win 9 million votes in the 1936 presidential election, but ended up with only 900,000 votes.

In 1937 Townsend was jailed for contempt of Congress when he refused to answer questions asked by a Senate Committee about claims of corruption in his organization. Townsend continued promoting his plan, although he adapted it considerably, and retained his popularity with elderly people, involving them in politics right up until his death on September 1, 1960, aged 93.

See also Coughlin, Charles E., Long, Huey P., Townsend Plan.

References and Further Reading
  • Amenta, Edwin. 2006 When Movements Matter: The Townsend Plan and the Rise of Social Security. Princeton University Press Princeton.
  • Schlesinger, Arthur M. 1960 The Politics of Upheaval. Houghton Mifflin Company Boston.
  • Townsend, Francis. 1943 New Horizons. J. L. Stewart Publishing Co Chicago.
  • Corfield, Justin
    Copyright 2010 by ABC-CLIO, LLC

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