committee a young veteran of World War II. At the last encampment he was elected commander in chief of the Veterans of Foreign Wars of the United States. He is a Navy veteran and that is the only thing I hold against him. [Laughter.] He is an attorney in his hometown. He is a graduate of the University of South Carolina and a director of Freedom Foundation. He is one of the most energetic young veterans in the country today and it is a high honor to present to this committee Jimmy Cothran, the commander in chief of the Veterans of Foreign Wars of the United States. [Applause.] Mr. COTHRAN. Madam Chairman and members of this very fine committee, I want to take this opportunity at the very outset of my statement to express my very sincere appreciation of this special hearing today. Unfortunately I was precluded from participating in the meeting the other day when the other veterans organization representatives were present and gave their program to you. I appreciate your taking time off from your very arduous duties to receive us this morning. It is a high compliment to my organization and I want sincerely to thank each and every one of you. The CHAIRMAN. We are delighted to have you here, Commander. I should like to request the members of our committee to rise and introduce themselves to this fine gathering and identify their congressional districts to you, before we begin our hearing. (The members of the Veterans' Committee were thereupon each presented to the representatives of the Veterans of the Foreign Wars of the United States present in the committee room.) The CHAIRMAN. You may proceed, Commander. Mr. COTHRAN. You, no doubt, have observed that I am accompanied here this morning by a large group of our comrades. We are engaged in our conference of national officers and department commanders which is held in Washington each year. Department commanders and other officers from every State and Territory are here to represent the membership of their departments. Our national officers, national council of administration, and major national committees are also present. It is a real privilege for our officers to visit this committee in session. I am proud of our officers and their leadership and am sure they reflect credit on our organization. I am sorry time will not permit each of them to meet and become acquainted with each of you. To the 14 new members of this committee, may I offer congratulations on your opportunity to serve. You have taken your places on a committee that is probably more important in the daily lives of millions of veterans than any committee in either branch of the Congress. The problems with which you will be confronted are involved and controversial and I hope that our organization can be of assistance. I know you will have valuable assistance and guidance from the experienced members of the committee, who have served with distinction in the 82d and prior Congresses. Although it is well known to those who have had previous service on the committee, I cannot resist bragging to the new members that my good friend and your colleague, Gen. B. W. (Pat) Kearney, is a past commander in chief of the Veterans of Foreign Wars. We are proud of his record, both as commander in chief and as a Member of Congress. Another of your colleagues on the House side and formerly a member of this committee, James E. Van Zandt of Pennsylvania, was three times. chosen as commander in chief of our organization. A total of 307 Members of the Congress are veterans of the Armed Forces, and we are proud to number among our members many legislators who served overseas. I mention this to indicate our organization embraces a responsible membership and is a representative cross section of veterans who have served their country in time of war on foreign soil or in hostile waters. Each year our national encampment, which is the supreme governing body in our organization, adopts resolutions. Before adoption, resolutions are referred to appropriate encampment committees for consideration and recommendation to the body of delegates. Our national legislative committee later reviews the adopted resolutions, without power to change or delete, and formulates a positive program. We believe national security should be the first concern of every citizen and, accordingly, have assigned top priority to resolutions dealing with that subject. My remarks today shall be confined to problems that come under the jurisdiction of this committee. THE PROBLEMS The most important problem confronting this committee is costand you will receive plenty of free advice, mostly conflicting, in and out of the Congress. In other words, how much is our Nation spending on the veteran benefit program; should the cost be increased; remain at about the same level; or be decreased? The answer is not easy and you have our complete sympathy in trying to find it. The pro and con pressures will be terrific but I am sure you will be faithful to your obligation and conscientious in your task. I am going to try to be helpful-here comes some of that free advice-by pointing out certain things which may or may not be "news" to you. First, I should like to point out that veterans, generally speaking, do not create the wars which create veterans. There's an old saying, with much truth, that old men make the wars and young men fight them. Care of veterans is the aftermath of war and directly related to war. War is costly-so is the care of veterans. Avoid wars and you eventually eliminate veterans. This does not, of course, solve your problem of cost but it justifies a sympathetic and generous approach to the problem. Next, I think it is reasonable to make a comparison of some past and present costs of the veteran benefit program. Is the Nation spending more today on its veterans, in proportion to ability to pay, than in some earlier decade of our history? Surprisingly enough the answer is "No." How often do we hear someone say, often important persons, that we are developing so many veterans and the cost of their benefits are so heavy that we must do something about it-pretty soon all males will be veterans and they will be paying each other benefits? Let's examine the facts. In the 1890's veterans represented about 3 percent of the total population of the United States. Today veterans represent about 13 percent of the population. Yet, in the 1890's the Government was spending a larger percentage of the national income on its 3 percent of the veteran population than the Government is spending today, out of national income, on its 13 percent of veteran population. It should further be pointed out that in the 1890's the benefits available to veterans were mostly confined to military pensions, medical treatment of a sort, and some domiciliary care, compared to the wide range of benefits available today, including educational aid and training. So we have a yardstick to measure the present with the past. Let us examine another phase of the problem of cost. How much are we spending annually on veterans now and on what type of benefits is the money being spent? Are we putting first things first or are we shooting all over the lot with the taxpayers groaning and complaining about handouts to veterans? Yes, there are some persons who believe that all veterans are receiving pensions and free hospitalization. I am sure we can all agree that veterans who are disabled by reason of service are entitled to first and major consideration when it comes to appropriations for veterans. I strongly suspect there are some who either forget, or selfishly ignore, this premise. After giving first consideration to the service disabled, what next? Here is where we scatter out all over the landscape. Shall we give the next consideration to aged, destitute, and permanently disabled non-service-connected veterans in the form of pension assistance, hospitalization, and domiciliary care or should we place major emphasis upon educational aid and training for able-bodied veterans regardless of income, age, or previous educational attainments? If we can afford only to spend a limited sum of money on our veterans, where shall the emphasis be placed? Perhaps a few statistics on spending for veterans in recent years will help point up the issue. ANALYSIS OF SPENDING FOR VETERANS In a 6-year period, 1947 to 1952, inclusive, acording to the Veterans' Administration, we spent a total of $1512 billion on hospitalization, outpatient care, compensation, and pensions for all veterans and/or their dependents. This includes veterans and dependents of all wars and peacetime service. In the same period of time we spent $1314 billion for educational aid and training under Public Law 346 on World War II veterans. This does not include vocational rehabilitation under Public Law 16 for the service disabled. It may also be revealing to point out that the total cost of all benefits to World War I veterans, excluding hospitalization and outpatient care for which specific costs are not available, but including the World War I bonus and insurance appropriations from the end of World War I to March 31, 1952, amounted to $1614 billion, or only $3 billion more than the cost of educational aid and training for one group of veterans over a 6year period. The value and desirability of educational aid and training assistance for able-bodied veterans is not questioned and the Veterans of Foreign Wars vigorously pioneered in requesting educational aid and training, particularly for those veterans whose education had actually been interrupted or delayed by reason of entry into the military serv ice. We also believe the Government and the American people have a traditional obligation to render modest assistance to aged and destitute veterans who are unable to take care of themselves and their dependents. The fact that the Government is now providing educational aid to veterans to enable them to earn more and theoretically become more useful citizens should not warrant neglect and intoler ance for those destitute and sick old veterans who did not receive this advantage. Inconsistency is developing among taxpayers, professional leaders, and among veterans themselves over the question as to where emphasis on spending for veterans shall be placed. Many of those who strongly advocate educational aid and training, with demands for an even more liberal program, take a dim view and shake their heads over the idea of the Government providing free hospitalization and modest pension assistance to our aged and destitute veterans. Former President Truman may have unwittingly exemplified this inconsistency when he vetoed a bill granting increases in the payment of pensions to blind and helpless veterans amounting to about $9 million per year, on the grounds there should be no discrimination between veterans and nonveterans merely because the veteran wore the uniform of the Armed Forces in time of war. Later, Mr. Truman approved without question a bill granting educational aid and assistance to able-bodied Korean veterans regardless of financial circumstances, age, or previous educational attainments which is estimated by the Veterans' Administration to cost approximately $1 billion per year when the program gets into full swing. The problem, therefore, of how much money can we afford to spend on veterans and how it shall be expended is pointed up by some of the foregoing remarks. The solution is not to deny the one in favor of the other. Perhaps a reasonable approach to the problem might be to give consideration to charging the cost of educational aid and training to national welfare or to Federal aid to education rather than as a charge against the veteran benefit program. RECOMMENDATIONS I have tried to point up the problem of costs and notwithstanding our appreciation of the task that confronts this committee, acting for the Congress, I consider it my duty as the spokesman for the Veterans of Foreign Wars to make certain specific recommendations. Our national legislative director, Omar B. Ketchum, will offer for the record, after I have concluded my statement, a digest of the current legislative program of the Veterans of Foreign Wars. I shall not attempt to discuss our entire program but will mention only a few of the things which we believe this committee and the Congress should carefully consider in the 83d Congress. 1. An immediate deficiency appropriation of not less than $15 million for the hospitalization, medical treatment, and outpatient care program of the Veterans' Administration to restore the closed beds and lost services which have developed as a result of inadequate appropriations by the 82d Congress. It should be pointed out that dental treatment has been approved and authorized for thousands of veterans but the treatment cannot be applied because of lack of funds. The longer this treatment is postponed the more involved and costly it will become. 2. Adjust the inequity in compensation payments created by the 82d Congress when that Congress approved legislation granting a 5 percent compensation increase to those veterans rated less than 50 percent disabled while granting a 15 percent compensation increase to those veterans rated 50 percent or more disabled. The amount of compensation payments are determined by the rate of disability and when a cost-of-iving increase is granted the increase should be across the board. The gracious chairman of this committee has introduced & bill supported by the Veterans of Foreign Wars, identified as H. R. baka mile would correct the inequity in compensation payments created by the last Congress and would, at the same time, establish a miform rate of payments in realistic amounts. ¿ Gare careful consideration to increasing the present inadequate rates of pensions payable to the aged and permanently and totally disabled veterans of World Wars I and II. Perhaps the time has ence to give consideration to a special pension program for the aging Teterans of World War I. £ Give Public Law 550, the Education and Training Act for Korean Veterans, known as the Teague bill. an opportunity to prove its provisions before making any substantial changes. We recognize that some representatives of private institutions of higher learning are complaining that their schools are not receiving a fair share of the enrollment of Korean veterans because of the payment provisions of Public Law 550. We believe the number of Korean veterans presently enrolled in colleges and universities do not constitute a valid test. The VFW supported the principle of direct payments to veterans and permitting veterans to make their own educational contracts. We see no reason at this time to recommend a change. 5. The VFW is traditionally opposed to increasing the present 4 percent interest rate applying to GI home and business loans. Our last national encampment again went on record opposing any increase in these interest rates and we strongly recommend to the Congress that where such loans are not available from private lenders at the 4-percent rate. consideration should be given to expanding the direct loan authorization by the Veterans' Administration. This concludes specific recommendations which I shall make in this statement but I would like to discuss another important problem confronting this committee, the national administration and the Veterans' Administration. I refer to the much-discussed and highly controversial subject of reorganization in the Veterans Administration. REORGANIZATION OF VETERANS' ADMINISTRATION The Veterans of Foreign Wars has opposed and no doubt will continue to oppose certain aspects of reorganization in the Veterans' Administration as recommended by the Hoover Commission and its task forces. We are unalterably opposed to the creation of a United Medical Administration wherein hospitalization and medical treatment for veterans would be transferred from the Veterans' Administration. We know from past experience that such a plan would result in interminable delays in hospitalization, medical treatment, outpatient care, and examinations for our veterans. I am sure this committee has knowledge of the fact that some 32 years ago hospitalization, medical treatment, outpatient care, and examinations for compensation were handled outside of the old Veterans Bureau and resulted in such endless confusion and delavs that President Hoover, by Executive order, consolidated all such activities dealing specifically with veterans under a Veterans' Administration. It is almost unbelievable that more than 30 years later a commission |