I feel very strongly, Mr. Chairman, that this is an inequity in the law that should be corrected. Where a man, through the service of his country, loses his chance of avoiding total kidney failure by 50 percent, he should receive the same compensation as one who loses his chance of avoiding blindness by 50 percent or his chance of avoiding impotency by 50 percent. I sincerely hope that the subcommittee will act favorably on my amendment.

Senator TALMAGE. Thank you, Senator Sparkman, we appreciate you taking the time to appear before us.

The next witness is Senator Barry Goldwater who will present testimony on S. 1860 which he has sponsored. Senator, we are honored to have you with us.

STATEMENT OF HON. BARRY GOLDWATER, A U.S. SENATOR FROM THE STATE OF ARIZONA

Senator GOLDWATER. Mr. Chairman, I am delighted that you would hold this hearing today on a relatively minor bill, S. 1860, that I have introduced together with my colleague from Arizona, Senator Fannin, on behalf of certain disabled National Guardsmen who suffered the loss of one or more limbs during World War I while performing military duties in connection with the entry of the United States into such wars. Judging from reports that I am given as to the position of Government agencies on the bill, they cannot determine who the bill will benefit or how many World War I National Guardsmen will be affected.

Though I still have not received a copy of the official departmental reports on the bill as of the time of this hearing, I am advised the Government will be against it. This doesn't surprise me as it is typical, I suppose, of bureaucracy. If you don't know, you oppose.

Mr. Chairman, let me shed some light on the purposes of my bill, which are really quite clear from the language of the bill. In all honesty, there is only one specific individual to whom I know it will apply, but if there are any other unfortunates still alive who went through a similar experience, I believe that any legislation passed should be general enough so that it covers them, too.

Mr. Chairman, this bill arises out of the extremely remarkable situation that happened to Hugh Hutton, then a young man who in his enthusiasm and patriotic love of his country, volunteered for military service at the age of 19, just when our country was entering into World War I. His unit was awaiting being mustered into regular Federal service, and in the brief interval before his unit was federalized, he was performing military duties assigned by the State directly and importantly related to our entry into that war.

It was while performing these duties that Hugh Hutton lost his leg. On April 18, 1917, 2 days after he had volunteered, needing his father's signed release to do so, Hugh Hutton reported for active guard duty around some flour mills. I might note that these flour mills were then doing some 27 million barrels of flour annually to feed our fighting men and those of our allies. If this was not important to our war effort, I do not know what was.

The same day, while guarding these mills, Hugh Hutton was accidentally shot by a fellow recruit. Immediately surgeons amputated his

left leg just below the hip, and in the nip-and-tuck fight to save his life decided against probing for the bullet lodged in his right leg. After quarts of blood transfusions, Hutton's life was saved. On June 20, 1917, without being given any notice at all, Hutton was discharged from his artillery company. Three days later his company was formally federalized and became a part of the 151st U.S. Field Artillery. Mr. Chairman, this is truly a unique set of circumstances which I cannot conceive of being repeated more than a handful of times, if that, and which cries out for action by his Government. If Hugh Hutton had been sworn into the 1st Minnesota Infantry, which was federalized on March 25, 1917, instead of the 1st Minnesota Artillery, he would have satisfied all the technicalities of our laws and been automatically entitled to compensation for his injuries. Or, if he had volunteered for service in the Army, Navy or Marines, rather than in the National Guard, he automatically would have become a full-fledged World War I veteran. Or, if he had been discharged from his company only 3 days later, he would have been entiled to receive full veteran's benefits.

Here was a young man who had made the special effort of obtaining his father's release so that he could volunteer for service to his country, and who had willingly obligated himself to serve for the complete duration of the war versus Germany. Here was a man who was actually performing duties important to the national war effort at the time of his injury. You might expect that someone in Government would have taken up his cause, and the cause of veterans who had suffered comparable tragedies, sooner than this.

But Hugh Hutton is too much of a gentleman to press his case. I only learned about it recently after being contacted by a veteran's organization. I know it as a fact that even some of Hugh Hutton's closest friends were not aware of how he lost his leg, until this veteran's group got into action and publicized his case.

Mr. Chairman, this case cries out for action by Congress. It will not lead to any raid on the Treasury. How many National Guardsmen were awaiting being mustered into Federal service? How many were performing military duties assigned by their States in connection with our entry into World War I at the time of their injuries? Among this very small category, how many actually suffered a loss of one or more limbs in performance of that military duty?

Mr. Chairman, it is obvious this bill is very limited in its coverage. There need be no fears the bill will be unduly expensive. In these extreme coincidences and legal technicalities which barred a veteran from the compensation which his grateful country has provided for veterans particularly for those who, as he, had suffered grave personal injuries in the cause of their country-there is only one recourse left for the individual citizen: redress by his elected representatives. Mr. Chairman, this bill goes to the very essence of our representative form of government, with elected officials who should be as responsive as possible to the people. If we, who are selected to represent all the people, do not correct the obvious injustices which failings in our laws have caused, we are negligent in our duties.

Mr. Chairman, I ask that you act favorably on my bill, S. 1860. Senator TALMADGE. Thank you, Senator Goldwater; we appreciate your testimony.

Our next witness is Senator Inouye, of Hawaii, to testify on his bill, S. 1001.

STATEMENT OF HON. DANIEL K. INOUYE, A U.S. SENATOR FROM THE STATE OF HAWAII

Senator INOUYE. Mr. Chairman, the legislation which I have introduced and which is presently under consideration by this committee, S. 1001, is designed to increase the statutory award to veterans who have lost one extremity from the current $47 to $80 per month. The statutory award is a supplemental benefit to the basic disability compensation payments.

The range of benefits to veterans who are disabled by injury or disease incurred in or aggravated by active service in line of duty during wartime or peacetime is on the average generous. Disabled veterans receive vocational rehabilitation assistance, medical treatment, hospitalization, low cost life insurance, compensation payments, as well as other benefits given to nondisabled veterans.

Over 300,000 Vietnam era veterans now draw disability compensation. The basic impairment of the disabled veteran's ability to function in society and to get a job is recognized in the amount of money he receives from the Veterans' Administration. The basic physical disability payments have been set at a level commensurate with the financial assistance needed by the disabled veteran. The other benefits which are added to the basic compensation payment have been raised over the years. Only the supplemental statutory award for single amputees reflects no change from past payment rates in light of present day economic realities.

The statutory award payment of $47 per month for single injury cases was set in 1952. Although awards for multiple amputations have been increased on several occasions over past years, it seems incomprehensible to me that those Vietnam veterans who have suffered single injuries, which in some cases are more serious in nature than lesser multiple injuries, received supplemental benefits over and above compensation payments of less than $1.60 per day-the same amount that Korean war victims received over 20 years ago. It is even more incomprehensible that the Veterans' Administration and the Office of Management and Budget have catagorized this $1.60 per day payment-an “adequate" supplement. The veteran who is a recipient of that sum and who has given a foot, arm, procreative organ, eye or ear in the service or our country does not find it "adequate." The American people would not consider "adequate." The Congress should declare it "inadequate."

Administration opposition to this bill is based upon the question of cost. As a member of the Senate Appropriations Committee, I too am concerned with the high cost of many governmental programs of dubious value to the public good. I assume there is no question as to the utility and correctness of disability payment programs. The projected cost of $34 million in the first year for increase benefits to 87,000 veterans may seem large when viewed alone. It is not, however, unreasonable at all when viewed in context. The Administration's proposed defense budget for fiscal 1975 amounts to $85.8 billion. Secretary Schesinger has indicated that $1 billion of that amount was added at

the last minute before Presidential submission to the Congress in the interest of stimulating the domestic economy. This statement indicates there is room for reassignment of spending priorities. The money that is needed to provide truly "adequate" benefits to disabled veterans can be found during this reassessment process.

The members of this committee are well aware of the plight of the disabled veteran. Chairman Hartke and his colleagues share my concern for the welfare of the vet. Having experienced a number of the problems which disabled veterans now encounter, I know the importance of feeling that a sympathetic and generous government appreciates the sacrifices of war and are willing to help when help is needed. The increase in supplemental benefits which I have suggested will provide needed help to these courageous soldiers in a time of high inflation and economic instability. I hope that your committee will soon take expeditious and favorable action on this long overdue legislation. Senator TALMADGE. We appreciate your appearance before this committee Senator, thank you.

The next witness this morning, is Mr. Odell Vaughn, Chief Benefits Director, accompanied by Mr. Howard Bernstein, Assistant General Counsel from the Veterans' Administration.

We are delighted to have you with us again, sir.

STATEMENT OF ODELL W. VAUGHN, CHIEF BENEFITS DIRECTOR, VETERANS' ADMINISTRATION, ACCOMPANIED BY JAMES T. TAAFFE, DIRECTOR, COMPENSATION AND PENSION SERVICE; HOWARD BERNSTEIN, ASSISTANT GENERAL COUNSEL; AND WILLIAM HOLSBERG, CHIEF OF PROSTHETICS, DEPARTMENT OF MEDICINE AND SURGERY

Mr. VAUGHN. Mr. Chairman, may Jim Taaffe's name also be shown, sir?

Senator TALMADGE. Certainly.

Mr. TAAFFE. James T. Taaffe, Jr., Director of Compensation and Pension Service.

Senator TALMADGE. Be seated, gentlemen and proceed as you see fit, Mr. Vaughn.

Mr. VAUGHN. Thank you, Mr. Chairman, I would also like to identify Mr. Wilfred Holsberg who is Chief of Prosthetics for the Department of Medicine and Surgery who is here with reference to the prosthetics question.

Senator TALMADGE. Fine, delighted to have you, sir.

Mr. VAUGHN. Mr. Chairman, members of the subcommittee, I am pleased to appear before you this morning to present the views of the Veterans' Administration on certain bills that would affect our serviceconnected disability and the death compensation programs.

One of the measures designated by the subcommittee is S. 1860, a bill that would deem certain disabilities incurred during the course of National Guard service in World War I to be service connected for the purpose of payment of Veterans' Administration disability compensation.

Others include S. 1001, which would increase to $80 the existing $47 additional monthly rate of disability compensation provided in 38

United States Code 314 (k); S. 1575, which would add loss of a kidney to the same section; S. 799, a bill to provide "adjustment assistance" to Vietnam prisoners of war; S. 2363, a bill which affects our automobiles and adaptive equipment program for veterans who have certain serious service-connected disabilities.

We have furnished your committee full reports expressing our views on each of these measures, and, with the Chairman's approval, request that they be incorporated in the record of this hearing.

Senator TALMADGE. Without objection, the VA reports will be inserted into the record at the proper place.

Mr. VAUGHN. We believe the most significant bills you have for consideration today are S. 3067, the Veterans Disability Compensation Act of 1974, and S. 3072, the Survivors Dependency and Indemnity Compensation Act of 1974.

I request that our reports on these bills also be made part of the record of this hearing.

Senator TALMADGE. Without objection, it is so ordered.

Mr. VAUGHN. Thank you. S. 3067 would increase by approximately 15 percent, the monthly service-connected disability compensation rates paid to veterans.

The President, in his letter of Mårch 4, 1974, to your committee proposed, among other things, a 12-percent increase in disability compensation payable to veterans, effective March 1, 1974. This would conform with the changes in the cost of living since the last disability compensation rate increase which was effective August 1, 1972, which amounts to 11.3 percent. The President further stated that to protect compensation benefits in the future, an automatic adjustment in benefits is needed to recognize increases in the cost of living, as measured by the Consumer Price Index.

Accordingly, we have submitted to the President of the Senate, and your committee, a draft bill which would accomplish the above-mentioned recommendations of the President regarding disability compensation. We believe the enactment of the draft measure would, in the long run, be more beneficial for the service-connected disabled veterans than S. 3067. Accordingly, we do not favor S. 3067, and urge your committee to favorably consider the President's proposals, as set forth in the draft bill, in lieu of S. 3067.

S. 3072 would (a) increase the rates of dependency and indemnity compensation by approximately 16 percent for widows and children of veterans whose deaths were service connected; (b) increase the monthly rates of aid and attendant death compensation by approximately 16 percent for widows, and dependent parents of veterans who died before January 1, 1957, and whose deaths were service connected; (c) equalize, whether peacetime or wartime, the monthly rates of serviceconnected death compensation payable for widows, children, and dependent parents of veterans who died of service-connected causes before January 1, 1957; and (d) presume service-connected death in the cases of certain veterans who had at the time of death permanent and total service-connected disability.

The Veterans' Administration does not favor the provisions of S. 3072 which would increase a monthly rate of death compensation, or equalize peacetime with the wartime rates of death compensation. Survivors of veterans who died of service-connected causes before