Beardsley Ruml
Encyclopedia
Beardsley Ruml was an American
statistician, economist, philanthropist, planner, businessman and man of affairs in the 1920s, 1930s and 1940s. He was born in Cedar Rapids, Iowa
. His father, Wentzle Ruml, was a country doctor. His mother, Salome Beardsley Ruml, was a hospital superintendent. He received a BA from Dartmouth College
in 1915 and a Ph.D. in psychology and education from the University of Chicago in 1917. On August 28, 1917 he married Lois Treadwell; they had three children. A pioneer statistician, in 1918 he helped design aptitude and intelligence tests for the U.S. Army. Ruml viewed society as composed of groups whose traits could be measured and ranked on a scale of normality and deviance.
From 1922-29 he directed the fellowship program of the Laura Spelman Rockefeller Memorial Fund, focusing on support for quantitative social and behavioral science. He was an advisor to President Herbert Hoover
especially on farm issues. In 1931 he became dean of the Division of Social Sciences at the University of Chicago--a center for quantitative research. He was not popular with the faculty and in 1934 Ruml became an executive of R. H. Macy & Company, parent company of the department store, rising to chairman in 1945. He also served as a director of the New York Federal Reserve Bank
(1937-1947), and was its chairman from 1941 until 1946; he was active at the Bretton Woods Conference (1944) that established the international monetary system. He was active in New Deal
planning agencies but their plans never saw fruition.
In the summer of 1942 Ruml proposed that the U.S. Treasury start collecting income taxes through a withholding, pay-as-you-go, system. He proposed an abatement on the previous year's taxes, making up the revenue by immediately collecting on the current year's taxes. In 1943 Congress adopted the withholding system.
In 1945, Ruml made a famous speech to the ABA
, asserting that since the end of the gold standard, "Taxes for Revenue are Obsolete". The real purposes of taxes were: to "stabilize the purchasing power of the dollar", to "express public policy in the distribution of wealth and of income", "in subsidizing or in penalizing various industries and economic groups" and to "isolate and assess directly the costs of certain national benefits, such as highways and social security". This is seen as a forerunner of functional finance
or chartalism
.
Ruml wrote several books and essays, including "The Interest Rate Problem," "Memo to a college trustee: A report on financial and structural problems of the liberal college," "Government, Business, and Values," and "Tomorrow's Business."
Ruml died April 19, 1960, in Danbury, CT.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
statistician, economist, philanthropist, planner, businessman and man of affairs in the 1920s, 1930s and 1940s. He was born in Cedar Rapids, Iowa
Cedar Rapids, Iowa
Cedar Rapids is the second largest city in Iowa and is the county seat of Linn County. The city lies on both banks of the Cedar River, north of Iowa City and east of Des Moines, the state's capital and largest city...
. His father, Wentzle Ruml, was a country doctor. His mother, Salome Beardsley Ruml, was a hospital superintendent. He received a BA from Dartmouth College
Dartmouth College
Dartmouth College is a private, Ivy League university in Hanover, New Hampshire, United States. The institution comprises a liberal arts college, Dartmouth Medical School, Thayer School of Engineering, and the Tuck School of Business, as well as 19 graduate programs in the arts and sciences...
in 1915 and a Ph.D. in psychology and education from the University of Chicago in 1917. On August 28, 1917 he married Lois Treadwell; they had three children. A pioneer statistician, in 1918 he helped design aptitude and intelligence tests for the U.S. Army. Ruml viewed society as composed of groups whose traits could be measured and ranked on a scale of normality and deviance.
From 1922-29 he directed the fellowship program of the Laura Spelman Rockefeller Memorial Fund, focusing on support for quantitative social and behavioral science. He was an advisor to President Herbert Hoover
Herbert Hoover
Herbert Clark Hoover was the 31st President of the United States . Hoover was originally a professional mining engineer and author. As the United States Secretary of Commerce in the 1920s under Presidents Warren Harding and Calvin Coolidge, he promoted partnerships between government and business...
especially on farm issues. In 1931 he became dean of the Division of Social Sciences at the University of Chicago--a center for quantitative research. He was not popular with the faculty and in 1934 Ruml became an executive of R. H. Macy & Company, parent company of the department store, rising to chairman in 1945. He also served as a director of the New York Federal Reserve Bank
Federal Reserve Bank of New York
The Federal Reserve Bank of New York is one of the 12 Federal Reserve Banks of the United States. It is located at 33 Liberty Street, New York, NY. It is responsible for the Second District of the Federal Reserve System, which encompasses New York state, the 12 northern counties of New Jersey,...
(1937-1947), and was its chairman from 1941 until 1946; he was active at the Bretton Woods Conference (1944) that established the international monetary system. He was active in New Deal
New Deal
The New Deal was a series of economic programs implemented in the United States between 1933 and 1936. They were passed by the U.S. Congress during the first term of President Franklin D. Roosevelt. The programs were Roosevelt's responses to the Great Depression, and focused on what historians call...
planning agencies but their plans never saw fruition.
In the summer of 1942 Ruml proposed that the U.S. Treasury start collecting income taxes through a withholding, pay-as-you-go, system. He proposed an abatement on the previous year's taxes, making up the revenue by immediately collecting on the current year's taxes. In 1943 Congress adopted the withholding system.
In 1945, Ruml made a famous speech to the ABA
American Bar Association
The American Bar Association , founded August 21, 1878, is a voluntary bar association of lawyers and law students, which is not specific to any jurisdiction in the United States. The ABA's most important stated activities are the setting of academic standards for law schools, and the formulation...
, asserting that since the end of the gold standard, "Taxes for Revenue are Obsolete". The real purposes of taxes were: to "stabilize the purchasing power of the dollar", to "express public policy in the distribution of wealth and of income", "in subsidizing or in penalizing various industries and economic groups" and to "isolate and assess directly the costs of certain national benefits, such as highways and social security". This is seen as a forerunner of functional finance
Functional finance
Functional finance is an economic theory proposed by Abba P. Lerner, based on effective demand principle and chartalism. It states that government should finance itself to meet explicit goals, such as taming the business cycle, achieving full employment, ensuring growth and low inflation.-...
or chartalism
Chartalism
Chartalism is a descriptive economic theory that details the procedures and consequences of using government-issued tokens as the unit of money. The name derives from the Latin charta, in the sense of a token or ticket...
.
Ruml wrote several books and essays, including "The Interest Rate Problem," "Memo to a college trustee: A report on financial and structural problems of the liberal college," "Government, Business, and Values," and "Tomorrow's Business."
Ruml died April 19, 1960, in Danbury, CT.