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pensions by Public Law 88-664. It is, of course, important, as you gentlemen know, to maintain a reasonable relationship between the benefits payable for service-connected disability or death and nonservice-connected disability or death. These two factors—the increase in pension rates and the increase in the cost of living—since the present compensation rates were established certainly require a further increase at this time.

Under existing law, a veteran with a service-connected disability rated at 40 percent disabling receives only $77 a month, while a veteran with a non-service-connected disability only 10 percent disabling receives $100 a month if he meets the income and age restrictions which determine the payment of the $100 monthly pension rate.

I mention this not as an objection to the pension rate but to emphasize that the compensation rate is not realistic when compared to it. I recognize that there are many proposals before you to increase the compensation rates and that to be realistic your consideration of them must take into account the limitations that may be placed upon you by budgetary considerations, so I shall merely express confidence that you will establish the most equitable increase that you consider possible of accomplishment.

I should like to direct my remarks more specifically to H.R. 5960, which was introduced by the chairman of the full committee at the request of the Federation of All Veterans. This bill would eliminate the differential between wartime and peacetime rates of disability and death compensation. As you know, the old death compensation statutes provided that the rates of compensation payable for service-connected death resulting from peacetime service would be 80 percent of the rate payable in wartime cases.

The Survivors Benefits Act established the program of dependency and indemnity compensation under which the rates were equalized for peacetime and wartime cases. However, the peacetime cases on the rolls under the old death compensation statutes are still subject to the 80-percent differential. By the enactment of the Survivors Benefits Act, Congress rejected the theory that there should be any differential in the compensation payable to survivors of service deceased in peacetime and wartime cases.

It seems to me consistency requires that the same concept should be extended to disability compensation and to the peacetime cases on the compensation rolls under the old death compensation statutes.

Title 38, United States Code, section 355 provides that ratings of service-connected disabilities should be based, as far as practicable, upon the average impairments of earning capacity resulting from such injuries in civil occupation. It seems clear that the impairment of earning capacity resulting from a service-connected disability incurred in peacetime service is just the same as that resulting if the disability had been incurred in wartime service. The 80-percent differential seems to be in conflict with this provision of the statute.

Representatives of the Veterans' Administration recently testified before the Subcommittee on Veterans Affairs of the Committee on Labor and Public Welfare of the U.S. Senate and stated that the administration favors steps to achieve equalization of peacetime-wartime compensation rates. This indicates that such legislation, if enacted

by the Congress, would be promptly approved by the President and I urge you to take favorable action on H.R. 5960.

Along that line and in connection with that, gentlemen, a disabled veteran with a service-connected disability in peacetime service is compensated 80 percent. If he dies from that disability his survivors are compensated at the wartime rate as the law now exists. In other words, the veteran who serves gets less than his survivors.

Now, Mr. Chairman, in conclusion, and gentlemen of this distinguished committee, please accept my deep appreciation for the many acts of interest and helpful consideration you and your most capable staff have always extended me over the years. In my considered opinion, Mr. Chairman, every veteran in our Nation regardless of age or the conflict in which he might have served his country, has been very graciously treated by you and your committee at all times. Thank you, sir.

Mr. Dorn. I want to compliment and thank you for your constructive attitude you have maintained throughout the years toward the veteran and for your respect for this committee. I want you to know we appreciate that. Mr. Î'eague.

Mr. TEAGUE of California. No questions. Thank you.
Mr. HANLEY. No questions. Thank you, sir.
Mr. DoRN. Thank you, Colonel.



Mr. DORN. Charles L. Huber, national legislative director of Disabled American Veterans.

Mr. HUBER. Mr. Chairman, I am accompanied by William Flaherty, the assistant director of legislation for DÂV, and John Keller, our assistant national service director for claims.

Mr. Dorn. We are very pleased to have you.
Mr. HUBER. Thank you.
Mr. DORN. Go right ahead.

Mr. HUBER. Mr. Chairman and members of the subcommittee, the Disabled American Veterans appreciates the opportunity to appear before you and present our position concerning service-connected disability compensation and related legislation.

Mr. Chairman, our statement will be confined to those measures which cover resolutions adopted at the most recent DAV national convention. I shall, therefore, address myself specifically to the following measures:

H.R. 169. This bill, introduced at DAV request, provides an increase of $75 per month in the rate of compensation payable to totally disabled veterans and proportionate increases in the compensation payable to other disabled veterans.

We recognize that service-connected disability compensation rates have been adjusted from time to time in order to keep pace with the

fundamental changes in price levels. Public Law 87–645, effective October 1, 1962, granted the most recent compensation increases, ranging from $1 per month for the 10-percent disabled, $7 per month for the 50-percent disabled, and $25 per month for those totally incapacitated.

These increases, averaging 9.4 percent, were most welcome and particularly helpful to veterans with the greater disabilities. However, this percentage increase did not serve to bring compensation rates abreast of increases granted workers in the general economy since 1933 and does not reflect true comparability with the increase in the cost of living since that date.

During this span of 32 years, increases in wartime compensation have averaged 126 percent, while the cost of living has gone up 139 percent, leave a 13-percent differential. This means a substantial reduction of purchasing power when compared to Government employees whose income has risen to 172 percent through enactment of legislation by the 88th Congress,

The President, in his January 1964 Economic Report to the Congress, in considering the measurement of poverty, states: "Various studies provide support for using as a boundary a family whose annual income from all sources was $3,000 (before taxes and expressed in 1962 prices).”

The $3,000 income figure has become a nationally recognized standard symbolic of the brink of poverty. Current wartime compensation rates for total disability is $250 a month, which equals exactly $3,000 a year. Peacetime rates for total disability is $2,400 a year, which is considerably below the poverty status.

In the most recent pay increases for the military services, congressional reports emphasized the importance of maintaining comparability with salaries and wages in the civilian economy as pledged by the late President Kennedy and incumbent President Johnson. The concept of comparability was also responsible for the pay increase granted last year to Federal executives, elected officials, and civilian personnel.

Moreover, current reports indicate that the administration is soon to recommend another pay increase for classified and postal employees. The recommendation will be based on a recent survey by the Bureau of Labor Statistics which confirms that Federal salaries still trail those of private industry.

Although the DAV would certainly offer no opposition to legislation authorizing salary increases, we would nevertheless make a point of noting that the increases, if approved, would cause the rates of compensation to fall back still farther in the race for comparability.

The principle of comparability makes a persuasive case for increasing compensation rates, particularly when you consider that the 100percent service-connected disabled veteran is in the bottom 11 percent of the income level of this Nation. We believe comparability is appropriately utilized in H.R. 169. This bill will provide an increase of $75 per month in the rate of compensation payable to totally disabled veterans and small increases in the compensation payable to those less severely disabled. This bill calls for a total average increase of 13 percent.

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Mr. Chairman, I have a chart showing the present rates and the rates proposed under H.R. 169 and I would like to have it inserted in the record at this point.

Mr. DORN. Without objection it is so ordered. (The chart referred to follows:)

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Mr. HUBER. We have also attached to our statement two tables taken from the 1963 Statistical Abstract of the United States. Table 449 is found on page 337, and table 459 is found on page 343 of the abstract. The figures, which are furnished for the committee's study, support our contention that there is a definite need for enacting legislation to provide increases in disability compensation rates.

In view of the many demands upon the committee, as well as the objections to benefits invariably raised by the Bureau of the Budget, we realize that priorities must be established. Through past experience we know for a fact that the veteran, disabled by wartime service, has attained a high priority with this committee, the Congress, and the American public, in the matter of distribution of the tax dollar.

If the merits of this bill are properly assessed, we think the committee will agree that the proposed increases are reasonable and supportable, that they will serve to bring compensation rates more Closely into balance with rises in the cost of living.

Among other pending bills on the subject of compensation is H.R. 176, to provide increases in rates of additional compensation on account of dependents payable to veterans rated as 50 percent or more disabled.

Under existing law, a veteran who has a disability or disabilities rated not less than 50 percent may qualify for additional compensation for his wife, his children, and dependent parents. Veterans' Administration records indicate there are 304,000 veterans rated as 50-percent or more disabled, with a total of 826,225 dependents.

A veteran who is totally disabled and has a wife receives an additional $23 compensation monthly. A veteran rated 50 percent and with a wife receives additional compensation of $11.50, or one-half of $23.

The increase in allowances for wives and children have been slow coming and rather meager. The last increase for these dependents occurred in 1957.

Veterans with disabilities rated 50 percent or more are considered to have serious industrial handicaps. Their problems of economic security are doubled or tripled, depending upon the number of people that they must support. When a wife and six children are involved, and the veteran is so seriously disabled that he is deprived of half his earning capacity, the allowance is only $49 more per month than that accorded to the individual with no dependents.

We urge the committee to give thoughtful consideration to the modest increases proposed in this compensation bill.

In connection with this same matter, there is pending before the committee H.R. 177, to provide that veterans having a service-connected disability rated at 40 percent or more shall be entitled to additional compensation for dependents.

Under existing law, veterans rated 40 percent receive no additional compensation for dependents. A veteran rated 50 percent who has a wife and three children received $138 a month, while a veteran rated 40 percent with the same number of dependents receives only $77 monthly.

This seems highly unreasonable in view of the fact that many disabilities rated at 40 percent for compensation purposes reflect a high degree of impairment. Included are leg amputations, multiple finger amputations, anatomical loss of an eye, and severe symptoms associated with diseases covering all systems of the body. Any of these conditions can place the individual in the seriously disabled class where his industrial capacity is very adversely affected.

Current Veterans Administration records indicate there are 127,000 veterans rated as 40-percent disabled.

We earnestly urge that your committee act favorably on this meaningful measure.

Another DAV proposal relating to compensation is set out in H.R. 1583, a bill to provide increases in compensation for veterans having single statutory awards based on service-connected disability,

VA records reveal there are, at present, 75,500 veterans receiving the statutory award under section 314, subparagraph (K), and 58,300 veterans receiving the award under subparagraph (Q).

It is worthy of note that these particular rates have not been increased in the past 13 years. On July 1, 1952, there was only a small increase ($5 per month) over the rate which had prevailed since September 1, 1946. In short, there has been a $5 raise in 18 years.

The conditions which are the basis for these special awards include disabilities that can never be adequately compensated for in terms of monetary benefits. Not only is physical ability impaired but the traumatic effect of these losses has been tremendously adverse for many individuals. Involved are the anatomical loss or loss or use of one foot; of a creative organ; or one hand; or both buttocks; or blindness of one eye; or complete organic aphonia with constant inability to communicate by speech; or total deafness of both ears.

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