tickled pink not to be assessed war reparations of $300 billion and only give us the $500 million of war assets.

It is hard to explain why some desperately wanted to turn this money back over. But that could have been done without cost to the taxpayers 2 years ago.

The committee reported my bill, but this great powerful lobby went to work on it, Mr. Chairman..

Mr. HALEY. The gentleman from Pennsylvania, Mr. Saylor.

Mr. SAYLOR. Mr. Freudenberger, I read your statement and would like to commend you on it.

I would like to ask you some questions. On the first page, you say you endorse the section of the bill which will grant vocational rehabilitation training to post-Korean veterans who have 30 percent disability. Why do you arrive at the magic figure of 30?

Mr. FREUDENBERGER. The man who has 30 percent or more disability—I think it is reasonable to hold that he needs training; whereas, in the case of a man who has service-connected disability of 10 percent or 20 percent, under 30 percent, they have to make a finding that he is actually in need of training. But the finding is automatic if the man has 30 percent or more.

COUNSEL. It is in the law.

Mr. FREUDENBERGER. It is in the law, yes. And we think that is a fair provision.

Mr. SAYLOR. So you would like to continue that provision to all peacetime veterans?"

Mr. FREUDENBERGER. That is right. We have a national convention mandate on that, and we are in favor of that particular section of S. 1138.

Mr. SAYLOR. And your organization is in favor of that provision, even though the members who would receive those benefits are not eligible to become members of your organization?

Mr. FREUDENBERGER. Yes, sir.

Mr. SAYLOR. Actually, the reason I ask that is that I think it strengthens your position.

Mr. FREUDENBERGER. Yes, sir.

Mr. SAYLOR. You are not looking at this from a membership standpoint; you are looking at it as a problem affecting the people who serve our country?

Mr. FREUDENBERGER. That is correct.

Mr. SAYLOR. Now, let me ask you this further question in regard to these veterans, these post-Korean veterans: Do you feel that the Armed Services Committee shoud take up legislation calling for the rehabilitation of members of the armed services before they return to civilian life. or before they are discharged?

Mr. FREUDENBERGER. We have taken no position on that, Mr. Saylor. But personally, it seems to me that it might be well worth considering. Mr. SAYLOR. The reason I raise that question is that many companies have found that they have been able to train men who have been hurt in their own plants, with their own rehabilitation program, and put them to use, and find a job for them in their own company.

Now, since we are going to have for a long period of time a sizable military force, we are just wondering whether or not this feature might

not be a desirable thing, to have the Army, or the Department of Defense, look at it.

Mr. FREUDENBERGER. One objection to it that I can see, though, is that there would have to be a dividing line as to the disabilities. You might have a man who was very badly disabled, and it might be a very long drawn out process to retain him in the Armed Forces and attempt to train him.

Actually, it is probably the VA's job to do that. But, as I say, I think, depending on the provisions of such a bill, it would certainly be very well worth study and consideration.

Mr. SAYLOR. Just thinking out loud on this subject, it seems to me that the military already has an obligation to the man that is in the service, and they should not transfer their responsibility to the VA. Some of these people that received sufficient disability are retired from the service.

Now, if they are retired from the service, do you feel that they should get benefits both from their military service and from the veterans' benefits?

Mr. FREUDENBERGER. Are you referring to a peacetime veteran who was injured in service and was retired from the Armed Forces because of his service-connected injury?

Mr. SAYLOR. That is right. I do not want to go back

Mr. FREUDENBERGER. Yes. I think he should come under that provision.

Mr. SAYLOR. Thank you.

Mr. HALEY. Any further question?

Mr. Adair?

Mr. ADAIR. No questions.

Mr. HALEY. Thank you very much for your statement.

The next witness is the AMVETS representative, Mr. John R. Holden.

Mr. Holden, we are very glad to have you before the committee this morning. I believe you have a colleague along with you this morning. If you will identify yourself and your colleague for the record, you may proceed.

STATEMENT OF JOHN R. HOLDEN, LEGISLATIVE DIRECTOR, AMVETS; ACCOMPANIED BY WILLIAM FLAHERTY, ASSISTANT NATIONAL SERVICE DIRECTOR

Mr. HOLDEN. Thank you, Mr. Chairman and members of the committee.

I am John R. Holden, the national legislative director of AMVETS, and I am accompanied by William Flaherty, the assistant national service director of AMVETS.

I appreciate this opportunity to present the views of AMVETS on the important issue of benefits for post-Korean ex-service men and women. The need for special legislation for the person who served after January 31, 1955, is especially great.

In the past, the Congress, in providing benefits for former members of the Armed Forces, has been guided by one very important consideration-whether the military service was performed during time

52087-60- -51

of war or in time of peace. Aside from the fact that the wartime serviceman was exposed to extra hazards not normally encountered in a regular tour of duty, it could be assumed that the greater portion of the wartime force was either drafted or volunteered because of the patriotic appeal and a sense of duty to country during a time of peril. In either event, it was clear that military service, in most instances, had interrupted the pursuit of a career in civil life. Thus, it followed that special treatment, including benefits to assure their successful reintegration into civil life, was in order for the wartime

veteran.

The straight peacetime ex-serviceman, on the other hand, was not exposed to the same hazards of service, nor was he motivated in the same manner in entering military service. In most cases, he voluntarily enlisted in the military because it offered him the career of his choice. The distinction, therefore, between war and peacetime service was crystal clear and the Congress proceeded to grant different benefits to each group.

The status of the group with service after January 31, 1955, is not so well defined. These men are not war veterans nor should they be placed in the straight peacetime service category. For the most part they are not men who analyzed the advantages and disadvantages of a military career and then enlisted through choice. These are men whose civilian pursuits were involuntarily interrupted. They were either drafted or served under the compulsion of the draft. In many instances the service was even more hazardous than that experienced by some war veterans. Yet, they are not entitled to nonservice-connected pensions. They cannot be hospitalized for treatment of a non-service-connected disability unless there is also present a service-connected disability. They receive no mustering-out pay. They have no entitlement to vocational rehabilitation, education and training, housing loan guarantee, and other benefits. In short, this is an entirely different category of veteran for whom no precedent with respect to veterans' benefits has ever been established.

It is the carefully considered opinion of AMVETS that the postKorean conflict group is deserving of special consideration. It is our further contention that legislation should be enacted granting to this group an education and training program that is somewhat less extensive than that presently available to war veterans.

We have studied the bills presently under consideration and recommend for your further action H.R. 2259. This measure, introduced by the distinguished chairman of your committee at the request of AMVETS, would authorize a program of vocational rehabilitation to overcome an occupational handicap created by service-connected disabilities for the post-Korean ex-serviceman.

This program is similar to the vocational rehabilitation program provided for disabled World War II and Korean veterans. Its extension to the post-Korean group will recognize the fact that the Federal Government has an obligation to teach new skills to persons unable to pursue their old occupation because of injuries or disabilities incurred in service.

H.R. 2259, additionally, would provide education and training benefits for persons who served after January 31, 1955, similar to those offered by title II of Public Law 550, 82d Congress, the so-called

Korean GI bill. The computation of educational time earned, however, would be based upon the formula of 1 day of education for each day of military service. Public Law 550, as you will recall, offers 12 days of education for each day of service.

The formula contained in H.R. 2259 thus recognizes the concept of a more limited benefit than that offered for war service. The need for a program of this nature cannot be overemphasized. Every day young men are being drafted. Their civilian pursuits are interrupted and personal plans are postponed.

Spokesmen for the Department of Defense have alleged that postservice educational programs will encourage persons to leave military service, thus resulting in a serious handicap in retaining qualified personnel. The solution to this problem, in our judgment, does not lie in making civilian life less attractive, but rather, in making a military career more attractive. If the Department of Defense recommendations are followed, it would be equally logical to devise a means of limiting and controlling the wages of civilian electronics technicians and the like because the higher salaries in industry will encourage qualified personnel to leave military service.

Should there be any validity to the Defense Department contentions, however, it is AMVETS belief that the "day for a day" formula contained in H.R. 2259 will overcome any problems of retention. Should this bill be enacted into law, beneficiaries seeking to earn enough school time for a full 4-year college course must spend more than the minimum 2 years in military service.

It has been indicated that the enactment of the National Defense Education Act with its provisions for loans to needy students lessens the necessity for a special educational benefit for post-Korean veterans. This reasoning is difficult to accept in the light of statistics furnished this committee by the U.S. Office of Education and the Department of Defense. The Office of Education stated that approximately 70,000 needy students will be aided by this program in the current academic year. Included in this number, of course, are veterans and nonveterans alike.

The Defense Department, on the other hand, tells us that approximately 600,000 peacetime veterans have been separated each year since Korea. Thus, a total of approximately 3 million persons would be immediately eligible for benefits if H.R. 2259 were approved. While the National Defense Education Act is certainly serving a worthy purpose, it is the opinion of AMVETS that it falls woefully short of filling the need for a program of education and training for the post-Korean ex-serviceman. Even more important, however, than the benefit to the individual serviceman, is the benefit that will accrue to the Nation if the proposed legislation is approved. The results obtained from the World War II and the Korean GI bills is impressive evidence of the value of such a program. Not only do we have a better educated citizenry, but the ability of these people to earn greater incomes has resulted in more tax income for the Federal Government.

Just a year ago the then national commander of AMVETS, Dr. Winston Burdine, in testimony before this committee cited his own case as a living example of the return to the Federal Government on their investment in him. Dr. Burdine said that he had received

$3,200 worth of education under the World War II GI bill and that in the 5 years following the receipt of this education, he paid the Federal Government $30,000 more in income taxes than he had paid in the 5 years preceding it. If all of the Government's investments provided a return of this nature, balancing the budget would be no problem. Even the Bradley Commission, not particularly noted for its praise of veterans benefits, had these kind words to say about the World War II GI bill:

There is little question that the veterans education program has been a great benefit to millions of veterans and to the Nation.

They went on to say:

Veterans who took advantage of the educational benefits of the GI bill are more likely to be in managerial, professional, and scientific jobs, and receive higher salaries than veterans who did not use such benefits or nonveterans, when age and experience prior to service are taken into account. The veterans educational program was a major contribution to the national welfare, and the country would be weaker educationally, economically, and in terms of national defense, if educators, veterans organizations, the President, and the Congress had not seen fit to embark upon this new and momentous educational enterprise. We of AMVETS are confident that a program of education and training for the post-Korean group as provided in H.R. 2259 would be equally productive of results. We respectfully urge the committee to report this measure or a similar measure as soon as possible.

Mr. HALEY. Thank you very much, Mr. Holden, for your statement setting forth the views of the AMVETS.

Mr. Adair, have you any questions?

Mr. ADAIR. Yes. From what you have said, Mr. Holden, it seems to me that we could summarize your views thus-and I wish you would comment on this-that it is the attitude of your organization that peacetime veterans, since the Korean conflict, are entitled to some consideration in this field of educational benefits. You do not feel, however, that they should be entitled to benefits at the same level as wartime veterans.

Is that a correct summarization of your view?

Mr. HOLDEN. Yes, sir. Basically, that is a correct summarization, Mr. Adair. We feel that there should be a distinction preserved between the benefits received or benefits accorded to the wartime veteran and those accorded to the men who are now serving in the military. Yet, at the same time, it should be more extensive than the benefits provided to the straight peacetime serviceman, because we are recognizing that men are either being drafted or are serving under the compulsion of the draft, and there is some hazard connected with duty today, or some potential hazard.

Mr. ADAIR. Would it be the attitude of your organization that if we come to the time when the draft is terminated, then such a program as this ought to be terminated?

Mr. HOLDEN. Absolutely, sir.

Mr. ADAIR. You would link it, then, to the draft?

Mr. HOLDEN. We would link it to the period of selective service, sir. Mr. ADAIR. You make reference to a proposal, H.R. 2259. Does that include provisions in addition to educational provisions or did it include home purchase?

Mr. HOLDEN. No, sir; it does not. It has only the educational and the vocational rehabilitation.