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pohnpei397 eNotes educator| Certified Educator

The Townsend Plan was something that was suggested by a doctor from California named Francis Townsend.  He proposed it because he did not believe that the New Deal was doing enough to help the elderly poor.

Under Townsend's plan, all retired Americans would receive payments from the government.  Townsend proposed that everyone over 60 years old who retired would be paid $200 per month.  Please realize that this was a huge sum in those days.  The only stipulation would have been that the recipients would be required to spend the entire $200 each month.  By doing so, they would be creating a great deal of demand for goods and services.  This would help the elderly themselves and would also get the economy going as businesses rushed to provide the seniors with the products they wanted.

The publicity surrounding Townsend's plan helped to push FDR towards creating Social Security.