President, National Association of Retired and Veteran Railway Employees is being sent to you for such action as may be consistent with the adopted policy. With best wishes and kind personal regards, I am

Fraternally yours,

E. ERICKSON, International Representative.

Mr. ELLIOTT. Perhaps we should have had this proposed amendment considered when the Congress was considering the 1968 amendments to the act, but we were fearful that inserting this amendment might delay the effective date of the increase that became effective February 1, 1968.

We were caught in the predicament when in 1965, 7 percent was granted to those under social security, and I believe it was close to 14 months before the railroad people received their 7-percent increase.

The railroad worker who retires today has a fairly decent pension and his wife or widow can make out OK with the necessary adjustments as time goes on to meet the cost-of-living rise.

The person who really is in bad shape is the widow of the worker who retired some years ago. This worker could have had 30 to 40 or more years of service on the railroad and his pension was figures years of service after 1937 and gratus years before 1937 to make his 30 years of service.

The widow's pension, however, is figured on average earnings per month beginning in 1937 until her husband passes on. This could be a very few years and all crafts' hourly and monthly earnings were a lot less than they are today.

The formula used is to find the average monthly wage and take 49 percent of the first $75 and 12 percent of the balance.

If the average earnings at that time was $200, the formula would produce $51.75, and if there were 10 years of service in which the employee earned over $300 in a year it would produce an added $5.15 or a total of $56.90.

I am also aware that under minimum guarantee law an adjustment can be made on that figure, but I also know that last summer hundreds of widows advised me they were getting a lot less. I am aware of a poor little old lady in my hometown who draws $43 a month and that is not enough to starve on.

It is true that Congress and this committee approves what amounted to a 13-percent increase for many of our widows. But because of the low level of pension received, many retired railroad widows did not actually receive much of an increase in actual dollars.

We have a good many widows, due to their low income, who must accept State welfare. In many States the increase granted under railroad retirement was deducted from their welfare figures which left them in worse shape than before the raise.

Under the present arrangement more and more of aged widows whose husbands have recently passed on are being thrown on to public welfare and into poverty. We believe to remedy this situation the retirement benefit of the worker should be continued on after his death. There is not only good reason and justice for this but compassion for the very old widow requires it.

These very old widows have been cast off in their day of greatest need as they have no one to turn to and little resources either physical

or financial. This all occurs because of an inequity in the formula which was set up in the beginning when the difference was not so great. Today, there is an ever increase in the cost of living and the purchasing power of the dollar is less.

If Congress wants to help the impoverished who are not being helped by the other antipoverty efforts and for whom no other solution to their problem is possible other than the Railroad Retirement Act, then we ask you to pass S. 2838.

(The document, proposal No. 1, follows:)

PROPOSAL OF THE NATIONAL ASSOCIATION OF RETIRED AND VETERAN RAILWAY EMPLOYEES, KISSIMMEE, FLA.

PROPOSAL NO. 1

It is proposed that a change be made in the Railroad Retirement Act which would provide the surviving spouse of a deceased principal beneficiary the same amount of basic retirement benefits that he (she) should/was drawing at the time of his (her) death, but in no case less than One Hundred and Three Dollars ($103.00). The surviving spouse would also be granted any increase in benefits under the Railroad Retirement Act which may be made effective at any time following the death of the principal beneficiary.

Under present law a widow receives approximately 80% of her husband's annuity and loses her spouses benefits. This amount is but a few dollars more than one-half of the joint amount they received prior to his death. This amount fails to meet the needs of the widow. The loss of one person does not cut living expenses in half. Many overhead costs such as property taxes, etc., remain the same regardless of the number of persons.

We have always believed that the man and wife were partners and jointly earned the family income, and jointly contributed to the Family retirement plan. The original makers of our Retirement plan recognized this principal when they included the spouses benefit.

We know that many of the widows must subject themselves to Public Welfare in order to have the bare necessities of life. During the past year, a seven percent (7%) increase was granted to those under the Railroad Retirement Act, the first since 1959. Some of the widows received this increase a year ago, under the Social Security increase, and as a result in some States, the Public Welfare was reduced by the same amount which did not give them any benefit at all. Others who tried to supplement their income, by working under Social Security, likewise had their benefits reduced.

In 1966 Congress passed a Supplementary Pension Law which increased the income for those who retired after July 1, 1966, by about Seventy Dollars ($70.00) per month. The poor widow, however, is still crying in the wilderness for help. This organization, therefore, is going to be the voice of those forgotten people. It is our opinion that what we are asking for is not unreasonable. It is right and just that we should protect and take care of our retired widows and not discard them as forgotten trash.

This proposal was unanimously approved by this organization in Convention. Mr. ELLIOTT. I was very happy to hear both the chairman of the Railroad Retirement Board and Mr. Schoene admit that there was a need for these particular people.

Their only objection seemed to be that there was no money available for them. But without criticism, I would respectfully like to call to your attention that when the need was there for an increase in annuities without raising the per capita tax to the employee, there was a way and means found by agreement to give the worker a supplementary pension of up to $70 per month.

In the 1965 amendments to the Railway Labor Act and also in the 1968 amendments, there was a way found to increase the spouse's benefit.

In other words, there were three built-in spouse benefit raises. There were ways and means found to do that. I have talked with thousands of spouses and people throughout the country, and I have found very few people, very few spouses, who do not say, "We would be glad to sacrifice a portion of ours if there is no other way to give the benefit to these people that we know are in need."

When you talk to these people, they come to your meetings, you can see by the way they dress-I wouldn't call shabby. I would call them neat but not up to date. The information you receive from the people and their neighbors is how these people are living.

I think the people should find the need.

Find a way to pay these people something more adequate and lift them up from poverty.

If the chairman will pardon me, I get a little overcome because there is no one who realizes the need of retired people until they are a retired person. When you go out and mingle with these people-and it was my privilege a year ago when I visited over 45 of our units of our retired railroad people you visit these thousands of people and see what their needs are as retired people.

It has been a privilege and very enlightening.

I, as their spokesman, am now coming to you people to ask you and plead with you to rectify a mistake that was made. Being a railroad man for many, many years, I have a good deal of pride that the railroad worker in this country has always been the leader in progressive legislation.

Just because there is not legislation covering those under social security, perhaps, who are in the same need, let us, as railroad people, lead the way again and see if we can't show the path where we can bring those benefits to all of those widows, whether it be social security, railroad retirement, or wherever they may be, so that they can take and last out the few years that they have remaining-not in want. Senator PELL. Thank you.

Yours has been a very moving and eloquent testimony.

One question which comes to my mind is the question of where the money comes from. You are talking about more than a quarter billion dollars a year, which is a rather large amount.

In your thinking and in your travels, there must have been some views with regard to who would pay for it. Should it be additional payments by railroad labor? Should it be a gift by the carriers? Should it be a gift from the taxpayers as a whole?

It has to be one of those three.

Mr. ELLIOTT. I understand, sir.

Being very prideful, we think we should take care of our own, but we do believe that there should be some method of balancing the load so that the people who are in need will get a little more of the benefits than those who are in the top brackets.

Senator PELL. What you are suggesting is a redivision of the pie, is that correct, where the normal retiree and the spouse would get less and the widow would get more?

Mr. ELLIOTT. Mr. Chairman, I am just a poor old wire twister. Senator PELL. But you are very eloquent.

Mr. ELLIOTT. I was an electrician in my working days on the railroad. Neither this organization nor I have the advantage of the statis

tics and other information necessary to arrive at a decision such as you are asking.

The Railroad Retirement Board has all of those things at their fingertips. I am sure if we requested it, they would give us all the information that they could in order to answer your question.

Senator PELL. I just want to be sure I understood you correctly in the beginning.

In answer to my queries as to which of the three, where the money should come from, labor, management, or the taxpayer, you are saying from labor; is that correct?

Mr. ELLIOTT. I said we are very prideful and we would like to take | care of our own. If that can't be done, then we should seek some other method in order to get that.

The answer through State welfare is not the answer.

Senator PELL. Would you support the idea of a reallocation of the benefits so you keep the tax rate the same it is now, with no increase, but the retirees as a whole would get less and the widows would get more?

Mr. ELLIOTT. I made a statement that it was the spouses who came to me and said that they would be glad a good many of them, I would say hundreds of them-would be glad to relinquish some of their increases so that these other people could have a better way of life.

Senator PELL. A good democratic process might be to take some kind of a poll or questionnaire in the ranks of railroad labor to see how you would come out.

Mrs. Dunlap, have you any comments or thoughts to add? You are particularly welcome here as a friend of Senator Morse, who has done so much for organized labor, who has played a leading role as their advocate and friend for many years.

Senator MORSE. I would like to hold Mrs. Dunlap's testimony for a moment to point out that your discussion with Mr. Elliott brings forth two or three requests of my own for additional information.

I want to say that the chairman, as is always true of him, has penetrated to the basic issue in the questions he has put to you. It is a question of where the money is going to come from. That has to be decided if we are going to follow any procedure that will seek to give more money to the widows. I am glad the chairman has raised that question.

You have answered him, as he points out, to say that you like to take care of your own. If there isn't enough money there to take care of your own on the basis of being fair to the widows, then some other procedure should be followed. First we have to come to grips with that.

I think we need from you some additional information over and above what you have in your statement. If the chairman will permit me, I would like to outline the kind of information I think we need.

Take the first page of your statement, in the 6th paragraph, where you say "The railroad worker who retires today has a fairly decent pension and his wife or widow can make out OK with the necessary adjustments as time goes on to meet the cost-of-living rise."

What you are saying is that there ought to be periodic adjustments in accordance with the cost-of-living index I assume?

Mr. ELLIOTT. Yes, sir.

Senator MORSE. But you draw a distinction between the railroad worker who retires today and his wife, or when his wife becomes a widow shortly after he retires, and the widow of those who have retired years ago. That says to me that the widow today, the new widow, under the present law, gets more benefit than the widow of the retiree.

I believe Mrs. Dunlap's husband died in 1951, as I recall. As I understand it, she gets less retirement benefits than a widow whose husband, we will say, died last month. I think the record needs to be supplemented with a table that shows these differences. If you take the transcript up to this moment, we do not have in the transcript the statistical material that we need to have to show what you witnesses allege as an unfair discrimination as between the present wife of a retiree or the widow of a recent retiree.

Therefore, I respectfully request that you have the Board help you prepare a table so that this committee studying that table can see the difference between the benefits that are paid to these respective difference in widow classifications, including also, the difference in what the spouse of a retiree gets at the present time and what a widow gets if she is widowed prior to the statutes you referred to in your testimony.

In the next paragraph, you say "A person really in bad shape is the widow of the worker who retired some years ago. This worker could have had 30 to 40 or more years of service on the railroad and his pension was figured years of service after 1937 and gratus years before 1937 to make his 30 years of serving."

I think you should know, and I think the opponents of this bill should know, my concern about this legislation. I think some may think it creates bias in my mind, whereas I happen to think it gives me a broader understanding of the problem.

Nevertheless, you ought to know my background of thinking on this subject. It so happens that my father-in-law was a railroad man for 42 years, a conductor, in very many of the latter years on the Chicago, St. Paul & Milwaukee Railroad. He died, leaving my mother-in-law, who had lived a very happy life until her declining years when she became hospital bedridden. Fortunately, the rest of us in the family take care of her. The real pittance that she received in comparison with her needs, by way of benefits from her pension left to her, wouldn't begin to have permitted her to live in decency in her declining years.

But she did, because of the family. There are a lot of these widows who are not that fortunate as far as the economic background of their families is concerned. They do face the problems about which you have so eloquently testified here today.

Therefore, I suppose because of that background, I have this kind of a personal interest in the legislation. It is not a personal interest, however, that is going to cause me to make a judgment that can't be consistent with the facts. That is why I am calling for certain facts that I don't think you have in the statement, and which we need. I want to know what these differences are.

Mr. ELLIOTT. I would be happy to furnish them.

Senator MORSE. You have one other point referred to by implication but not spelled out, although you talked about the possibility, and the chairman has talked about the possibility, of some money being taken from payments that are now paid to spouses of retirees. I couldn't take