Senator STAFFORD. Commander, I am happy to be able to report that to the chairman of this committee, Mr. Hartke, and this Senator, joined in introducing Amendment 2005 to S. 969, which will take care of this situation. It will come out either this week or next week.

Mr. RANDAZZO. Needless to say, sir, I am very happy to hear that. Thank you very much.

My second proposal, Mr. Chairman, relates to the war orphans and widows educational assistance program. As you know, these benefits are presently extended to the eligible survivors of veterans whose deaths were service related and to dependents of veterans who are permanently and totally disabled from service-connected causes. In line with the VA's classification of "serious disability," we request the extension of these benefits to the dependents of veterans rated 50 percent or more disabled.

Mr. Chairman, America's disabled veterans owe this committee a special vote of thanks for its initiatives in the employment area. However, disabled veterans have been particularly hard-hit by the catastrophic rates of unemployment in the United States during recent years, and they critically need our combined efforts in this area.

More than 7 million Vietnam era veterans-over 400,000 of them disabled-have entered the workforce, and their employment needs are vast in scope. It is generally acknowledged that the unemployment rate among disabled veterans is significantly higher than that of the general public, a tragic statistic considering that it applies to those who sacrificed physical and psychological well-being in the military service of their country.

To help solve this problem, the DAV feels that the Veterans' Employment Service should be given a greater degree of authority within the Department of Labor. Specifically we strongly recommend that the position of VES Director be raised to the level of an Assistant Secretary of Labor, so that he will have the power he needs to be truly effective.

Another form of employment assistance for disabled veterans is the Affirmative Action program which requires Federal contractors to give special consideration to the employment of disabled and Vietnam era veterans. For these purposes a disabled veteran is defined as one whose disability is rated as being 30 percent or more disabling or as one who is discharged from military service because of a disability incurred in the line of duty.

Mr. Chairman, a disability rated at 10 or 20 percent may very well constitute a more pronounced employment handicap than one rated 30 percent or more disabling. To insure the proper employment priority for all disabled veterans, we therefore recommend that the criteria for participation in this program be lowered to include any veteran with a compensible service-connected disability rating.

In discussion of employment problems, Mr. Chairman, I would like to point out that the Comprehensive Employment and Training Act (CETA) does not provide for preference to disabled veterans in its programs. Indeed, participation by disabled veterans in CETA programs has been minimal. We therefore urge that legislation be enacted to provide for enrollment of disabled veterans in CETA programs on a priority basis.

Mr. Chairman, with your kind indulgence I have five other proposals which touch on VA programs of housing, insurance, and burial benefits which I would like to bring to your attention.

The first deals with specially adapted housing benefits for seriously disabled veterans as authorized by chapter 21 of title 38, U.S. Code. As you know, veterans who have suffered the loss or loss of use of one upper and one lower extremity are presently excluded from the $25,000 housing grant.

The DAV has long felt that these veterans are so seriously impaired that they have a definite need for specially adapted housing. We therefore urge that the eligibility criteria for the housing grant be amended to include any veteran who has suffered the service-connected loss or loss of use of two or more extremities.

In the area of insurance benefits I have two proposals. First, that the face value of National Service Life Insurance, which has been set at a maximum $10,000 since its inception in 1946, be increased to $20,000. Certainly the rise in the cost-of-living that has occurred since World War II more than justifies such an increase.

Second, we suggest that the present 1-year application period pertaining to Service Disabled Veterans Insurance (RH) be extended to 2 years from date of disability determination. We feel this 1-year period is unduly restrictive and that disabled veterans should be given this additional time in order to evaluate and act upon their life insurance needs.

Mr. Chairman, the DAV is adamantly opposed to the VA proposal which calls for suspension of the $250 burial allowance in those cases when a veteran's survivor has received a social security lump sum death payment.

We have appreciated your past support of our position on this matter and urge that it continue in the future.

We also ask that you continue with your efforts to expand the VA's National Cemetery System. We are truly grateful for your recent efforts in this regard as evidenced by the passage of legislation authorizing new National Cemeteries in the States of California and Virginia. It is the position of the DAV that all veterans should be entitled to burial in a national cemetery that is reasonably close to their homes, and we strongly support legislation to provide at least one National Cemetery in each State.

In closing, Mr. Chairman, I want to express again our grateful appreciation for giving us this opportunity to appear before you. I hope and trust that the legislative objectives that I have presented here today will receive your early and favorable consideration.

I cannot emphasize strongly enough that the DAV holds the members and staff of this committee in the highest regard. I pledge to you the complete cooperation of our organization in a mutual effort to improve and protect the benefits and services for America's serviceconnected disabled veterans, their dependents and survivors.

Thank you very much.

Senator STAFFORD. Commander, I think I can pledge to you the sympathetic attention and cooperation of all the members of this committee. I want to compliment you on a very fine statement which you have given to us today to assist us in our deliberations in the near-term future.

We will pay careful attention to it; all the members of this committee will study the complete statement and the recommendations that you have made. I can assure you that this Senator is sympathetic to most of them, speaking individually, particularly the request you have made that would keep the VA hospitals separate from any other hospital system.

I can also add on page 11 of your statement where you refer to the Assistant Secretary, raising the Veterans' Employment Service to the level of an Assistant Secretary of Labor. That is also a part of S. 969, as reported, that I mentioned.

Mr. RANDAZZO. Thank you, Senator.

Senator STAFFORD. Let me, on behalf of the full committee, express our appreciation to you, sir, for your presence and that of all of your comrades here to help this committee help you and for all of us to have the chance, thereby, to help our country. Thank you very much. Before we adjourn, I would like to make a part of the record of today's proceedings the written statement of William F. Lenker, chairman, national veterans affairs and rehabilitation commission, The American Legion.

I am sure that members and staff of the committee will find the comments of Mr. Lenker enlightening.

The committee will be adjourned subject to call of the Chair. [Whereupon, at 2:55 p.m., the hearing was adjourned.]

STATEMENT OF WILLIAM F. LENKER, CHAIRMAN, NATIONAL VETERANS AFFAIRS AND REHABILITTION COMMISSION, THE AMERICAN LEGION, BEFORE THE COMMITTEE ON VETERANS' AFFAIRS, UNITED STATES SENATE, SEPTEMBER 14, 1976

Mr. Chairman and members of the Committee:

As chairman of the National Veterans Affairs and Rehabilitation Commission of The American Legion, it is a pleasure and privilege for me to appear today before this distinguished Committee of the Congress, to place before you the principal legislative concerns of our organization for the 95th Congress, and for fiscal year 1978.

On behalf of our National Commander, William J. Rogers, who is presently overseas, and of all Legionnaires, I wish to express the appreciation of The American Legion for this opportunity.

The American Legion has just completed its 58th National Convention, in Seattle, Wash., and the matters I shall place before you are the results of the deliberations of the delegates to the convention, in the field of veterans affairs. May I say at the outset that The American Legion believes that it will become increasingly important for it to speak with a firm and insistent voice during the years immediately ahead, to insure that the nation, during this time of peace, does not forget its obligations to those who have answered the call to service in time of war.

The need for vigorous action in defense of veterans programs, we believe, is recognized among veterans. It is attested by the fact that at this time our organization has already enrolled a membership strength for 1976, in excess of 2,700,000, and is presently showing a national membership that is at a 20-year high. This is especially significant in light of the rising mortality curve among both veterans of World War I and World War II. We are pleased to note an increasingly heavy enrollment of Vietnam generation veterans. We believe this shows that a marked percentage of these younger veterans do indeed plan to take an active interest in the national welfare, and in veterans benefits, through their association with a veterans organization.

I shall now address myself to the legislative priorities of The American Legion, as we envision them for the coming year. I can tell you that these priorities are basically the same as those that concern us presently. We shall, of course, adjust them to particular needs that become apparent as time moves forward.

VA BUDGET FOR FISCAL YEAR 1978

First, a word about the Budget. The Veterans' Administration will operate with outlays for fiscal year 1977 in the neighborhood of $20 billion. We consider this amount to be barely adequate to meet the needs of veterans programs. The President has, of course, not yet sent forward his budget recommendations for the next fiscal year. When he does so, The American Legion will examine them closely, to ascertain their adequacy. We are concerned, as are all Americans, with continued inflationary pressures, and the impact these pressures will have on veterans programs. In addition to our concern for benefit programs, we are especially anxious that sufficient funds be available to continue the upgrading of the VA medical care program. The President has committed himself to the construction of eight new and replacement VA hospitals. We applaud this commitment. It is essential to the viability of the VA hospital system. We point out that attention must also be given to pay comparability scales, and to the recruitment of top quality professionals into the VA system to guarantee second to none quality of medical care for veterans. The problems of the VA medical care program are complex and interrelated. Constant vigilance is necessary to properly maintain what is now, undoubtedly, the finest health care delivery system in the world. The American Legion is determined that it shall remain so, and we firmly believe that is what the American people want for their veterans.

We await with great interest the release of the forthcoming study of the VA medical care program that was mandated by Public Law 93-82, and that is being carried out by the National Academy of Sciences. Section 201 of Public Law 93-82 authorizes and funds the Academy to "conduct an extensive review and appraisal of personnel and other resources requirements in Veterans' Administration hospitals, clinics, and other medical facilities to determine a basis for the optimum numbers and categories of such personnel and other resources needed to ensure the provision to eligible veterans of high quality care in all hospital, medical, domiciliary and nursing home facilities." This study, which we now understand will become available after January 1, 1977, should be definitive in nature and scope, and will hopefully provide an objective perspective of the long-range goals and needs of the VA system to meet its Congressional mandate to look to the health of eligible veterans.

ADJUSTMENT OF COMPENSATION RATES

In Resolution No. 109 (Ky.), the Seattle National Convention addressed itself to the matter of the adequacy of compensation rates for the service disabled. Congress has been consistently responsive to the need to adjust these rates in the face of the continuing inflation of recent years. We, of The American Legion, are grateful for this. Care for the service disabled has always been the number one priority of the Legion among all veterans benefit programs. It is our recommendation in Resolution No. 109, that the need for renewed legislation each year could be obviated if the compensation rates were attached to the cost-ofliving index, so that it could rise with that index. We acknowledge there are those who believe that the service disabled are treated more generously at the hands of Congress than they would be under a system that responds automatically to cost-of-living increases.

Our concern is that the present system makes the service disabled hostage to the press of Congressional legislative business, and results in an undesirable time lag between fluctuations in the cost-of-living index and legislative relief.

PENSION REFORM

Our second legislative priority for the 95th Congress must be pension reform. This committee is aware that The American Legion has for several years past, petitioned Congress for pension reform. Most will agree that the present pension system is not responsive to the subsistence needs of veterans who are permanently and totally disabled by reason of age or physical disability, or to their survivors. Congress has attempted to alleviate this nagging problem through the enactment of legislation that must be termed stop-gap in nature. Legislation of recent years has not solved the basic problem. This organization is in receipt of an unending stream of letters, truly pitiful in their expressions, in which the aged veterans of World War I, plead for help. Aged veterans and widows especially, are the prime victims of the raging inflation that has affected the

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entire American people. It is not necessary for me here to detail the nature of their problem. We have no doubt that Congressmen to, are in receipt of their pleas for relief.

Unquestionably, what is needed is a new pension system that will assure to eligible veterans and their survivors, an annual income, fixed above the poverty level, and rising with it, that will enable them to live out their years with dignity, in reasonable comfort, and above all, not being denied medical attention, medicines and such other medical ancillary items as will guarantee them some measure of physical comfort, and protection from the diseases and afflictions that accompany advancing years.

This kind of a system is not what veterans have now. Any slight fluctuation in their income from other sources, such as social security benefits, results in a decrease in veterans pension. Under the present system, they experience no relief in the face of continuing inflationary pressures. Frankly, the present system has become anachronistic, and it must be changed. Urgency is added by the fact that the youngest remaining World War I veteran is now 78 years old. He does not have much time left to know that his Government cares about him, and that his surviving widow will not be forgotten.

The American Legion has chosen to approach this grave problem through Resolution No. 39 (Nebr.), adopted by our Convention last month. In Resolution No. 39, we propose a fundamental solution to the pension problem. Basically, our proposal is to guarantee the pensioner an income floor, fixed above the poverty level, and rising with it. We continue to adhere to the needs test, because we believe the funds available for the pension program should be reserved for those who need pension assistance.

What we propose, however, is an abandonment of the present, cumbersome, unresponsive system, and the substitution for it of a relatively simple system that will take into account all sources of income available to the pensioner to sustain him in reasonable comfort and dignity, and to supplement that income with a pension amount that is fair and equitable to his needs.

In the judgment of The American Legion, no matters that will confront the 95th Congress transcend in importance and urgency, the need for a thoroughgoing pension reform.

We earnestly request this committee to make pension reform a priority item that will result in a definitive solution to the problem, and an effective relief for pensioners no later than the advent of fiscal year 1978.

ADJUSTMENT OF DEPENDENCY AND INDEMNITY COMPENSATION RATES

In Resolution No. 373 (District of Columbia), our Seattle national convention calls for the affixing of DIC rates to the cost-of-living index, to insure that the survivors of the service-connected deceased will experience prompt relief from inflationary pressures. The approach we suggest to this benefit is similar to that proposed for the compensation rates assigned to the service disabled. The need is there for a system that will be responsive to the cost factors that affect all families that have lost the breadwinner. And in this category of beneficiaries, there are none more deserving than the survivors of those who have died as a result of service to the Nation.

ADJUSTMENT OF VOCATIONAL REHABILITATION AND EDUCATION AND TRAINING ALLOWANCES

It is now 2 years since there has been upward adjustment in the education and training allowances, provided by Public Law 93–508. Further adjustment in these allowances, as well as in those for vocational rehabilitation, are now overdue. If some relief is provided during fiscal year 1977, still, in our judgment, continued attention will have to be given by Congress to this benefit program as we approach fiscal year 1978. Inflation has abated, but it has not ended. Projections for the economy by economic specialists are conflicting. Experience tells us that inflationary pressure will not end in the immediate future.

Upward adjustment in the education and training allowances is necessary if the vocational rehabilitation and education and training programs are to fulfill the intent of Congress in enacting them into law. The enactment of Public Law 93-508 was not a simple legislative journey, and in view of that fact, we hope for early attention to these programs by the 95th Congress. We, of The American Legion, have addressed the needs of these programs through adoption of Resolution No. 107 (Ky.), by our Seattle national convention. We commend Resolution No. 107 to the attention of the committee.