men leave the service to enter fields of occupation in which they have a much more reasonable opportunity to provide for those who are dependent upon them.

The Commissioned Officers Association, Public Health Service, and the Association of Commissioned Officers, Coast and Geodetic Survey, urge the enactment of this legislation for the benefit of the Government and out of consideration for the personnel involved and the widows of such personnel.

Thank you very much, Mr. Chairman.

Mr. DORN. Thank you, Captain.

Any questions?

Mr. FINO. No.

Mr. KORNEGAY. No.

Mr. DORN. Captain, we are glad to have you and receive your comment. You had a very fine statement.

We are glad to have Commander Erickson, Veterans of World War I of the U.S.A.

STATEMENT OF JOHN E. ERICKSON, NATIONAL COMMANDER OF VETERANS OF WORLD WAR I OF THE U.S.A., INC.; ACCOMPANIED BY MELVIN D. EDDY, NATIONAL LEGISLATIVE DIRECTOR; MICHAEL J. DWYER, STAFF RESEARCH COMMITTEE MEMBER; EDWARD LUMBARD, DEPARTMENT COMMANDER OF THE DEPARTMENT OF MASSACHUSETTS; AND ROY CHITTENDON, PUBLIC RELATIONS OFFICER

Mr. ERICKSON. I would like to introduce the staff members this morning. To my right is Melvin D. Eddy, the national legislative director, and on my left Mr. Dwyer, who is a staff member on research; also a distinguished visitor that came up with us this morning, the Honorable Edward Lumbard, the department commander of the Department of Massachusetts.

Mr. DORN. Would Mr. Lumbard stand, please?

We are delighted to have you.

Mr. ERICKSON. And our national public relations officer, Mr. Roy Chittendon.

Mr. DORN. You don't have anyone from New York City or North Carolina, do you?

Mr. ERICKSON. Not this morning, Mr. Chairman. I would have been happy to have them.

Mr. DORN. That is not necessary. These boys are with you, anyway. Go ahead.

Mr. ERICKSON. Mr. Chairman and members of this distinguished committee, I would like at this time to express the gratitude of the veterans of World War I and myself for the privilege of appearing before the Veterans' Affairs Committee on behalf of the disabled veterans of the United States in asking for the support of H.R. 4918 introduced by the Honorable Arnold Ölsen of Montana on February

27, 1961.

We are all aware of the responsibility that we owe these disabled veterans, the trust they have in us as their agents, in helping them in a small way solve their financial problems. Many reasons can be given why these disabled veterans need our assistance. The ad

vancing age of the veterans of World War I, the ever-rising cost of living. The financial situation of the World War I veterans, of course, is strongly influenced by their lack of employment income. Less than 25 percent of disabled veterans 65 years and over have income from employment and often they work only part time.

Many disabled veterans have no income from employment. In thousands of cases wives of disabled veterans have been required to seek employment to support their family. To the disabled veteran because of retirement and living on fixed incomes, rising prices are a severe problem, and a special burden to his dependents.

As a result of rehabilitation, thousands of the handicapped veterans of World War I were able to work performing in every occupational field and doing their jobs as efficiently and reliably as workers who had no handicap. These disabled veterans were employed in every segment of America's productivity. Many disabled veterans entered occupations in which there were serious shortages of professional and technical people, such as teaching, nursing, clergy and laboratory technicians. Now these disabled veterans have passed or are passing 65 years of age and are forced to retire on a reduced annuity due to lack of years of service in their chosen employment. This reduction in income is found to be a problem due to several causes, such as chronic illness or aggravated wartime disability, while in employment. Also with daily expenses the same as during his employment period the disabled veteran finds the fixed income insufficient to continue his standard of living.

Independent living will continue to be the rule for the World War I disabled veteran, despite the availability of more and improved institutional facilities. There is a strong desire among these disabled veterans to hold to a familiar pattern of living as long as they are able. The prime consideration of importance for these older disabled veterans, is that they want to maintain their independent living arrangements as long as possible.

There is no doubt that there has been a marked increase in the cost of living and that salaries in most of the industries have been raised to combat this fact.

We recognized that the life expectancy for the World War I disabled veteran would likely be less than the life expectancy for any other group of citizens. It has been determined, that the rate of change in physical condition and economic adjustments which accompany advancing age, greatly accelerates during the period among disabled veterans when they pass 65 years of age. Of course the physical conditions which occur differ widely with individuals over a period of time.

The monthly rates of disability compensation were last increased effective October 1, 1957, at which time the amount for total disability was raised by slightly more than 24 percent; whereas the amounts for ratings less than total were raised approximately 10 percent.

Since 1957, practically all other forms of pay and allowances over which Congress has control have been increased, including civil and military salaries and retirement pay, railroad retirement, and social security benefits.

The rates of death compensation have not been increased since 1954. It is true that many widows, and dependents did receive higher

awards beginning January 1, 1957, by changing to rates of dependency and indemnity compensation under the Servicemen's and Veteran's Survivor Benefits Act. But those who were not in a position to take advantage of that act should hardly be expected to continue indefinitely at death compensation rates without a cost-of-living increase.

The Bureau of Labor Statistics announced March 4, 1960, that the Consumer Price Index for January 1960 was 125.4. The alltime high was in November 1959 of 125.6.

It will be noted that the Sales Management Survey of Buying Power, a standard and accepted reference publication on national incomes, states that the average effective buying income of a family in the United States is $6,005 per year, more than 76 percent higher than in the case of the totally disabled veteran.

A totally disabled veteran with wife and three children are living on $3,400 per year.

Because of disability many veterans cannot obtain some forms of insurance: commercial insurance.

If disabled veterans are able to work at all they must compete in the open labor market, and often, must settle for reduced pay. The number of jobs for which a disabled veteran can qualify is severely limited. The disabled veteran is at a competitive disadvantage, even though he can handle or perform the duties of a particular job perfectly well.

Compensation payments received by aging disabled veterans from the Veterans' Administration constitute an increasing proportion of the income of disabled veterans 65 and over as advancing age encounters employment income reduction. While not all of the World War I veterans are in the 65 and over age group, within another 5 years all will have reached or passed that age.

The total of compensation payments does not loom large in the national economy as a whole, providing less than 1 percent of the national income flow. However, the facts are these payments are made in accordance with criteria and rates that are uniform throughout the United States and that they supply a steady flow of economic support and stability. Such payments have a more direct and vital influence on economic activity in some areas and they are of critical importance to the aging veteran recipients.

The monthly payment rates vary according to the degree of disablement. Age is not a factor except as reflected in the degree of disablement, which ranges from 10 percent, with a wartime origin rate of $19, to a total disability rate of $225. Some additional amounts are paid for critical anatomical losses. Receipt of monetary income is the main source of economic living support of disabled veterans aged 65 and over.

There can be no doubt that the economic factor of cash income limitation in retirement and some variation geographically in the cost of living, and hence the quality of living that a given fixed monetary income will buy from place to place, have provided some incentive to the aging disabled veteran 65 and over, to move to new locations on retirement. This has resulted in some "migration", both permanent and seasonal. Much of this shifting appears to have been simply moving into the less expensive areas. There are over 25,000 citizen veterans living in Mexico at the present time.

Health status, which has a double economic impact on the individual through its influence on his employment and earning power and upon the cost of maintaining his established living standard becomes a factor of primary importance to the disabled veteran. Expenses of health maintenance through medical care accelerate greatly with advancing age, and this comes for the disabled veteran 65 and over at a time when his income and purchasing power declines. Coupled with the rapid rise of the veteran population 65 and over in recent years and looking to the future, this has become a matter of increasing national concern.

Physical condition of the disabled veteran today is a factor in the decision by the employer and the aging veteran himself as to whether to offer or take employment in specific cases. The effects of changing health has a direct specific bearing on the economics of the individual disabled veteran aged 65 and over.

While some groups have various protections through more flexible types of income payments and through adjustment clauses and contracts or Government guarantees or price support programs, the group of citizens whose incomes are most vulnerable to devaluation through inflation includes aging disabled veterans. They are largely and increasingly with advancing years dependent on income sources with relatively fixed rates, such as retirement and compensation income.

The importance of this situation to the aging disabled veterans aged 65 and over, has been increasingly recognized and in January 1960 the Senate Subcommittee on Problems of the Aged and Aging recommended careful study and consideration of proposals to protect the purchasing power of retirement income.

On March 21, 1961, we received by request the following statement from the Veterans' Administration, Department of Veterans' Affairs, Washington, D.C.

During the fiscal year ending June 30, 1960, there were an average of 802,609 World War I veterans receiving disability compensation (851,257 were on the rolls as of June 20, 1960) and 43,615 veterans receiving compensation died during that year. Data was not complete for fiscal year 1961.

In closing I would like to quote the estimated first year cost of subject bill, if enacted, are as follows:

1 Includes additional cost to increase rates to approximately 62,600 cases reflected in the subparagraphs (a)-(j) caseload but who also receive an additional amount under subparagraph (k).

These figures were supplied by Staff Research Committee Member Michael J. Dwyer by the Veterans' Administration upon request on April 20, 1961.

It is of particular interest to note that the estimated cost of the bill ($139,240,000) broken down would be an estimated expense of $16,952,000 which would be attributable to World War I veterans or approximately 12.2 percent.

Mr. Chairman and members of this honorable committee, may I again express my thanks for the privilege of presenting the statement of my organization in support of H.R. 4918 for the disabled veteran of the United States.

May I say in passing also that my organization is in sympathy with the disabled veterans of all wars although we have our own organizational problems to contend with.

Thank you very much.

Mr. DORN. Mr. Erickson, these 25,000 veterans living in Mexico that you mentioned, they are just down there because of the standard of living or what?

Mr. ERICKSON. Cost of living, yes.

Mr. DORN. Principally?

Mr. ERICKSON. That is right.

Mr. DORN. You have made a good statement and I do appreciate it. I can say on behalf of the chairman of the full committee also that we appreciate your attitude and your very kind comments over the country about the committee.

Mr. ERICKSON. Thank you.

Mr. DORN. You do not follow this policy of going around lambasting the Veterans' Affairs Committee. Of course, if you ever run across any ideas how we are going to raise this money, please let us know. Thank you very much, Mr. Commander.

Mr. ERICKSON. Thank you, Mr. Chairman.

Mr. DORN. We thank all the others. We are glad to have you. Mr. James Hafey, Catholic War Veterans of the United States. Mr. Hafey, as a good Southern Baptist I am glad to have you, particularly, with our committee. You go right ahead.

STATEMENT OF JAMES W. HAFEY,

HAFEY, EXECUTIVE DIRECTOR, CATHOLIC WAR VETERANS

Mr. HAFEY. Thank you, Mr. Chairman.

I am James W. Hafey, executive director of the Catholic War Veterans, with offices located here in Washington, D.C.

Initially, I wish to express my sincere appreciation for the opportunity afforded me to appear before this subcommittee this morning to express the views of my organization on the many bills under consideration.

In studying the broad spectrum of veterans' benefits with a full appreciation of its magnitude there is one area that looms more important than all others because it relates exclusively and particularly to each individual veteran himself. It affects his body or his mind or both. I have reference, of course, to an injury or injuries or sickness sustained by the veteran while in service and something that may and in most instances will remain with him throughout his lifetime and perhaps defer him from fulfilling many of his ambitions. Providing properly for this individual is one of the greatest responsibilities of the Congress and the country.

Even a brief study of the many benefits available to veterans clearly demonstrates that the Congress throughout the years has been basically fair and equitable in providing for the veteran, particularly in those cases where he has sustained a service-connected disability. This is a responsibility that we all know exists.