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Housing Resolution No. 83: Extension and liberalization of direct loan authority of the Veterans' Administration. H. R. 27 by Mrs. Rogers.

Legislative Resolution No. 156: Requesting legislation to provide a service connection for injuries incurred en route to induction. H. R. 345 by Mrs. Rogers. Legislative Resolution No. 371: Requesting legislation authorizing a system of judicial review of certain decisions of the Administrator of Veterans' Affairs. H. R. 1994 by Mr. Evins.

Legislative Resolution No. 384: Requesting corrective legislation for the purpose of uniformity in the rates of disability and death compensation, H. R. 43 and 44 by Mrs. Rogers.

Rehabilitation Resolution No. 34: Requesting an increase in the present burial allowances. H. R. 47 by Mrs. Rogers.

Rehabilitation Resolution No. 51: Requesting an amendment to Public Law 877, 80th Congress, to make dependency allowance benefits uniform among all service-connected disabled veterans. H. R. 48 by Mrs. Rogers.

Rehabilitation Resolution No. 110: Requesting legislation to provide a presumption of service connection for tuberculosis other than pulmonary. H. R. 46 by Mrs. Rogers.

Rehabilitation Resolution No. 131: Requesting an amendment to Public Law 346, 78th Congress, to insure proper review of disability status of persons discharged from the armed services. H. R. 40 by Mrs. Rogers.

Rehabilitation Resolution No. 198: Requesting legislation to prohibit the severance of a service connection, except for fraud, which has been in effect for 10 years. H. R. 463 and 628 by Messrs. Kearney and Teague, respectively. Rehabilitation Resolution No. 199: Requesting legislation to establish a presumption of service connection for malignant tumors developing to a 10 percent or more degree of disability within 2 years following separation from active service. H. R. 45 by Mrs. Rogers.

Rehabilitation Resolution No. 209: Same as Legislative Resolution No. 384. Rehabilitation Resolution No. 224: To provide that policies of United States Government life insurance and national service life insurance shall be incontestable for fraud unless asserted by the Government within 2 years following issuance or reinstatement of a policy. H. R. 1261 by Mr. Kearney.

Rehabilitation Resolution No. 232: Requesting legislation to extend the delimiting date, July 25, 1956, to those veterans who have been precluded from applying for training under Public Law 16 by reason of chronic service-connected disabilities requiring prolonged hospitalization. H. R. 462 and 630 by Messrs. Kearney and Teague, respectively.

Rehabilitation Resolution No. 244: Requesting legislation to provide chiropractic treatment in Veterans' Administration hospitals and on an outpatient basis. H. R. 54 by Mrs. Rogers.

Rehabilitation Resolution No. 279: Requesting legislation to permit claims for waivers of insurance premiums. H. R. 547 by Mr. Philbin.

Rehabilitation Resolution No. 308: Requesting legislation to provide assistance to certain World War I disabled veterans in purchasing an automobile under the same terms and conditions as veterans of World War II and of service on and after June 27, 1950. H. R. 42 by Mrs. Rogers.

Rehabilitation Resolution No. 338: Requesting legislation to prohibit the reduction of any rating of total disability or permanent disability which has been in effect for 25 years or more. Appropriate bill to be introduced.

Rehabilitation Resolution No. 381; To oppose all efforts to reorganize the Veterans' Administration by transfer of essential functions to other executive departments. H. R. 1291 by Mr. Multer.



To provide increases in the rates of death compensation payable to certain widows and children of World War I, World War II, or of service on and after June 27, 1950. H. R. 461 by Mr. Kearney.

To provide office space and stenographic assistance to the accredited representatives of certain veteran organizations. H. R. 498 by Mr. Lane.

To provide additional compensation for the loss of hearing. H. R. 260 and 264 by Mr. Elliott.

The CHAIRMAN. Thank you very much, Mr. Commander, for a very fine statement.

I am sure you feel, as I do, that the Korean war has been called a police action, and to take the men out of the Veterans' Administration hospital and put them in private hospitals under the Public Health Service would mean treating them as if they were police officers rather than soldiers and veterans.

Mr. MING. We certainly agree with you there, Madam Chairman. I have with me today our Director of Claims, Mr. Cicero Hogan, and our Assistant Legislative Director, Mr. Charles Foster.

The CHAIRMAN. Both are very fine men. I know of their activities, as do the other members. They never stop working.

Mr. MING. If there are any questions, we would be glad to answer


The CHAIRMAN. Are there any questions that the committee would like to ask now, or would they rather wait and ask the questions later on?

Mr. HAGEN. In this statement on page 4 of opposition to efforts to increase the interest rate on veterans' loans, would you give us the reason for that position?

Mr. MING. Yes, Congressman Hagen. Primarily it stems from the fact that at each convention our organization has gone on record in some form of a resolution asking that the Veterans' Administration be allowed to work out a program that will do what Congress intended when they first made this benefit possible. So far, and as I understand the latest report of General Gray, there are 30,000 Veterans' Administration loans made a month. But what is not covered in that statement is the percentage of those loans that are not made at 4 percent interest. It might, on the surface, be a 4-percent proposition, but under the present means of getting the final financing a builder has to increase his selling price because most of these loans contain a 12-percent service charge, 12 percent of the original loan total, plus a 5-percent discount.

Assume that there was a $10,000 loan: If you had this 5-percent discount, which is required to sell it to the final lender, and the 12-percent service charge, that amounts to $650 that the builder has to pass on to the veteran. He cannot assume that and stay in business. When that occurs the veteran has to pay in addition to 4 percent interest the $650, whether it be in the form of a discount or service charge. Now if you take that same loan over a 20-year basis and increase the interest to 42 percent it would be $320. So under our present 4-percent formula, unless you can get a direct loan through the Veterans' Administration, but very few are made in western areas, you are actually penalizing the veteran to the tune of about $330 above what the law originally calls for, and under the interest rate as set by the Administrator of the Veterans' Administration. In other words, the veteran today is paying more than what 42 percent would be.

I do not wish to get into a controversy about the 42-percent rate, because our organization is mandated to attempt to make this work on a straight 4-percent basis, but we do have in our resolutions-and this appears on the first page of our supplemental report-this language: "Extension and liberalization of direct-loan authority of the Veterans' Administration." The Chairman has introduced H. R. 27 to extend and liberalize the direct-loan authority of the Veterans' Administration. This would break the deadlock without having to

increase the interest rate and still stay within the purpose and intent of the original GI bill.

Mr. HAGEN. In response to what pressures that this discount provision and other provisions come from the lenders of the money?

Mr. MING. Here is the odd position that the lender is placed in. Take any and many of the large lending institutions throughout the United States that make these loans. They can invest their money in tax-exempt Government bonds and draw 2.3 to 2.7 percent interest, which actually yield more than they can by lending money at 4 percent on a loan-guaranty basis to the GI, so if you were a lender what would you do? You do not have to worry about a foreclosure proposition. Mr. HAGEN. They control these requirements; is that it?

Mr. MING. Actually, I think what it is, there are two branches of our Federal Government competing with each other, and one is not sure what the other is doing. You find one branch of our Government offering bonds and another branch guaranteeing loans at 4 per


Mr HAGEN. Your organization urges the more expanded directloan basis like the State of California has?

Mr. MING. You are very familiar with that program, and so am I. In the State of California you build a home and get a loan at 3 percent interest, and the State makes a tidy sum. If that is the means of breaking this deadlock, I think the rights and privileges of our veterans should come first. The California plan is not new. It has been in existence since 1923. It was created for World I veterans and has shown there is a tidy profit at 3 percent interest.

Mr. ADAIR. You make it quite clear, Commander Ming, that your organization views with considerable skepticism, to say the least, certain of these Veterans' Administration reorganization plans as proposed. I take it, then-and this is to clarify our thinking that by and large you do not favor the suggestions made in Booz, Allen & Hamilton report?

Mr. MING. Definitely not.

Mr. ADAIR. And you do not favor the reorganization plan as proposed by the so-called Hoover Commission report?

Mr. MING. That is right.

Mr. ADAIR. But you do favor the reorganization plan proposed by General Gray last November?

Mr. MING. That is right in most casses. May I call on our Director of Claims to answer that?

Mr. ADAIR. Let me suggest that I would like very much to discuss specific titles of that with the members of your staff.

And a final point is, on page 5 of your statement you quote from a resolution of your 1952 convention. 1952 convention. Do I read that correctly, beginning in the third line from the bottom, to mean that you feel that if the Booz, Allen & Hamilton recommendations, for example, were carried out, that we would even do away with the title "Veterans' Administration"? Does your organization mean that literally?

Mr. MING. I would not think that would be the literal interpretation. I was not on the resolutions committee at that time.

Mr. ADAIR. I am glad you clarified that, because it did seem to me to be a very extreme statement.

Mr. MING. That is erroneous.


Thank you for bringing that to our

The CHAIRMAN. Thank you very much, Mr. Commander, for a very fine statement, and good luck to you for what you are doing. Do you think you can come back to us later?

Mr. MING. Oh, yes. Let us know, and we will be glad to come back at your convenience. Thank you very much.

The CHAIRMAN. The gentleman from Ohio has a very pleasant duty.

Mr. AYRES. Madam Chairman, members of the committee, and citizens, I assure you it is an extreme pleasure to introduce a commander of the AMVETS who is not from my district. A year ago the man who had the honor of serving in that capacity was from my district, and he learned so much from the AMVETS he thinks he should be in Congress.

The present national commander of AMVETS, Commander Marshall E. Miller, comes from Mr. Springer's district in Illinois. He has a background of being a lawyer, a leader in the community and the Nation, and judging from the background he has presented to me and knowing of the kind things Congressman Springer has had to say about him, I have felt that the greater the leader, the briefer the introduction need be.

I give you Commander Miller.

The CHAIRMAN. We are delighted to have you here, Commander Miller.

Mr. MILLER. Thank you. It is a pleasure to be here.

The CHAIRMAN. Please be seated.



Mr. MILLER. I would like to thank you, Madam Chairman and members of the committee, for the opportunity to appear before your committee to present our legislative program for 1953.

I would like, with your permission, to insert a digest of our resolutions so that I would not take up the time of a busy committee to read them.

The CHAIRMAN. Without objection it is so ordered and will appear at the end of your statement.

Mr. MILLER. Before proceeding with our statement, we desire to express sincere gratitude to the members and staff of the Committee on Veterans' Affairs for the excellent cooperation and assistance rendered to AMVETS during the past year. Our organization long ago became aware that the present veterans program is the direct result of the efforts of this group and its predecessors. We are certain that your continued careful study, nonpartisan approach, and constructive criticism on all matters affecting veterans will maintain and preserve the great rehabilitation programs provided by a grateful people to their war veterans-thus assuring a program which will always be a credit to the Nation.

AMVETS have made a careful study of many matters affecting veterans and their dependents. Our national convention resolutions cover in some manner every major program of the Veterans' Administration. They are concerned with compenastion, pensions, education, housing, rehabilitation, insurance, veterans preference in public employment, and Veterans' Veterans' Administration medical services.

Because of its extreme importance, we desire to dwell on the latter subject and touch only briefly on the remainder of our resolutions. Among our resolutions are recommendations calling for:

A fair test for the Korean GI bill with no amendments to that act until such time as it has been given a chance.

An amendment to Public Law 23 of the 82d Congress to give veterans a reasonable time to come back into the national service life insurance program.

Elimination of legislation which permits service-connected disability to be a deterrent in the obtainment of national service life insurance.

Amendment to Public Law 23 of the 82d Congress which would give veterans of service since June 27, 1950, more time to take out contract insurance.

We think a most important matter is the retention of the 4-percent interest rate on GI home loans. If it is increased, you are taking away, actually, a benefit, and putting veterans on a par with the balance of the public who did not render the service to their country that they did. There has been what amounts to a sit-down strike on the part of moneylenders who are requesting an increase in interest rate. The demand for the higher priced homes of $20,000 and over has been satisfied, and the veterans who have been waiting to purchase their homes are going to be prejudiced by virtue of being prudent if the rate goes higher.

We think there should be additional legislative authority for Veterans' Administration supervision of contractual relationships between veteran purchasers and sellers in order that veterans might get a full dollar's value for a dollar spent. We think there should be a 1-year guaranty on homes built under the GI loan program. This would give the veteran some assurance that he is buying a sound house, and he would have some recourse if a leaky basement or other defects due to faulty construction should develop within a year. And we think there should be an extension of the direct VA loan program with sufficient funds for successful operation.

There should be a continuation of the Employ the Physically Handicapped Week.

We feel there should be restrictions on veterans preference so as to require a passing grade and 10 percent disability before preference is granted.

We will be prepared to offer testimony on these and related issues at the call of the chairman.

With reference to Veterans' Administration reorganization, AMVETS believe that the Veterans' Administration can be operated with economy, efficiency, and wisdom. However, the present system of management within the Veterans' Administration has failed to divide staff and line responsibility. This outmoded management plan has created voluminous instructions, too many organizational units, lack of delegation of authority, lack of initiative, and a multitude of misunderstandings. After repeated congressional inquiry, repeated private management recommendations, and repeated public demand, the Veterans Administration now proposes to change its system. While this is commendable, it demonstrates most clearly that the Veterans' Administration itself in the past has had very little

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