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disabilities. The standards, rules, and evaluations covering service-connected disabilities were developed through a long process of experience. The combining of non-service-connected conditions with unrelated service-connected disabilities is a complete departure from established practices and procedures and, we believe, could contribute to the impairment of the compensation program. Under the circumstances, the Veterans' Administration is unable to recommend the favorable consideration of H.R. 5320 by your committee.

H.R. 187 would authorize a clothing allowance of $300 per year to each veteran who, because of a compensable service-connected disability, uses a prosthetic appliance which tends to wear out or tear his clothing. The initial cost of this program might be as high as $15 million the first year, increasing each year thereafter.

The group of veterans contemplated by the bill is presently given special consideration in that they receive compensation at higher rates than the basic amounts authorized for their degree of disability as determined under the schedule for rating disabilities. The amount of monthly compensation may run as high as $525, plus additional amounts for dependents and an additional $200 for aid and attendance. These higher rates give recognition to the fact that these seriously disabled veterans face a variety of special problems, including the wearing of appliances, in addition to impairment of earning capacity.

Under existing law the Veterans Administration furnishes "special clothing" made necessary by the wearing of a prosthetic appliance and, as a corollary, also furnishes repairs, reweaving, and special protective linings to those areas of conventional clothing where damage or excessive wear is or could be the result of wearing such an appliance.

In view of the special benefits already available to this group, the Administrator has concluded that he is unable to recommend favorable action on H.R. 187.

H.R. 1745 proposes concurrent payment of full compensation and partial pension to certain veterans of World War I and later wars. It would authorize use of the same service-connected disability as a basis for such dual payments, and would extend to those veterans a preference in the pension field.

Also, this proposal to blend the compensation and pension programs, which have different objectives, would result in paving pension for permanent partial non-service-connected disabilities. Partial disability pension was authorized for World War I veterans in 1930. It was discontinued in 1933. Since then permanent and total disability has been required to qualify for pension as a World War I veteran. It has always been a qualifying requirement for pensions for veterans of World War II and the Korean conflict. In our judgment it is a reasonable requirement. Moreover, we see no basis for extending to certain service-connected disabled veterans a preference such as is proposed by the bill.

Due to lack of necessary data, we are unable to estimate the cost of the measure if enacted.

The Veterans' Administration recommends that H.R. 1745 be not favorably considered.

H.R. 5509 would require concurrent payment of full pension and partial compensation for certain war veterans, with service-connected disabilities stated in the bill, who meet the requirements for pension. The mandatory provision to pay pension in lieu of a portion of disability compensation would have an adverse effect upon most veterans with disabilities rated abve 30 percent because the combined payments under the bill would be less than the compensation currently payable. On the other hand, it would result in greater combined payments for most veterans with service-connected disabilities rated at 30 percent or less. The bill would extend preferred treatment to veterans with certain service-connected disabilities and would be discriminatory and precedential as to veterans with other service-connected disabilities. This proposal to blend the compensation and pension programs, which have different objectives, could result in dual payments based on the same disability.

It is estimated that enactment of the bill as introduced would result in a savings of $45,800,000 the first year, and that savings should increase to a minor extent in each of the succeeding 4 years. For the information of the committee, if H.R. 5509 did not have the mandatory substitution feature, but instead permitted the payment of the greater benefit, it is estimated the first-year cost of the bill would be approximately $10,900,000, and that the cost should increase slightly in each of the succeeding 4 years.

The Veterans' Administration recommends that H.R. 5509 be not favorably considered.

Mr. DRIVER. Now, I would like to take a few minutes to talk about some of the specific proposals. In regard to the many bills before you, there is an important group composed of proposals to increase the rates of compensation payable to service-disabled veterans. The basic rates of compensation for such veterans were last increased in 1962 (Public Law 87-645) while the rates of additional compensation for their dependents have not been increased since 1957 (Public Law 168, 85th Cong.). The cost of living has increased about 10.5 percent since August 1957 and about 2.7 percent since the rate increase in September 1962.

Currently available data do not furnish a basis for a definitive judgment as to the economic impairment flowing from percentage ratings less than total. These veterans retain an industrial capacity which may vary from that anticipated depending upon a complexity of factors such as diagnosis, experience, age, education, and rehabilitation training. As the committee is aware, the Veterans Administration is currently engaged in a study designed to validate the schedule for rating disabilities in terms of economic loss. This study should furnish us valuable data on the average economic impairment flowing from each disability percentage level as well as the economic impairment resulting from the residuals of the various diseases and injuries. The results of this study, however, will not be available for quite some time. In any event, the rise in the cost of living has affected disabled veterans in varying degrees depending on their disability evaluations.

In our detailed statement which has been placed in the record we analyze each of these bills and explain the various formulas used in proposing increases in the existing rates. After careful study and consideration of all the proposals, we have concluded that H.R. 171 most acceptably provides necessary increases for the service-connected disabled veterans.

While there is a lack of data available with respect to disabilities less than total, there are well-established data showing that the totally disabled veterans are clearly undercompensated. H.R. 171 recognizes this fact by proposing to increase their compensation rate by $600 annually.

H.R. 171 would also extend modest increases to veterans rated 20 percent through 40 percent, achieving a uniformity of intervals beiween disability levels and at the same time, extending to these categories the same percentage increase in their rates as has been enjoyed by the 10-percent group since the first post-World War II increase in 1946 (i.e., 40 percent). Certain increases would then be extended to the 50 percent through 70 percent cases, likewise achieving a generally uniform interval between disability levels from the 50 to 90 percent groups.

Finally, H.R. 171 would extend a 10-percent increase in the additional allowances for dependents, in the case of veterans rated 50 per.cent or more disabled, in the light of the rise in living cost since these rates were last increased in 1957. This additional proposal appears to be amply justified. The first year's cost of H.R. 171 is estimated to be about $102 million.

For the reasons I have outlined, the Veterans Administration would have no objection to the favorable consideration of H.R. 171 by your committee and I am advised that the Bureau of the Budget concurs in this position.

There are two new proposals recommended by the Veterans' Administration to which I would like to refer. The first measure is designed to equalize the rates of disability compensation (and the rates of additional compensation for dependents) payable to veterans of wartime and peacetime service. As you know, under existing law the rates paid to peacetime veterans are 80 percent of those authorized for wartime veterans.

Although a rate differential has existed since 1917, the Servicemen's and Veterans' Survivors Benefit Act which the Congress enacted in 1956 effected a major change in this area. It authorized payment of dependency and indemnity compensation for all service-connected deaths without distinction between wartime and peacetime service.

For many years the law has required that in evaluating disabilities for disability compensation purposes, the Veterans' Administration utilize a schedule of ratings of reductions in earning capacity from specific injuries or combinations of injuries which requires that the rating be based upon average impairments of earning capacity resulting from such injuries in civil occupations.

It is apparent that a veteran who has suffered a disability as a result of peacetime service has the same loss of earning capacity as a veteran with the identical disability suffered during wartime service. Hence. we cannot justify a continuance of the differential in the rates of disability compensation on any basis consistent with the nature and purpose of this benefit. We accordingly recommend the enactment of our proposal authorizing payment in peacetime cases of the rates of disability compensation and additional compensation for dependents now being paid in wartime cases.

This proposal would have an additional cost of about $28 million the first year.

The second proposal which the Veterans Administration recommends be enacted by the Congress would extend to certain veterans disabled by military service during the induction period the $1.600 assistance toward the purchase of a specially equipped automobile or other conveyance.

This monetary assistance is now available to World War II and Korean conflict veterans who have suffered, as a result of such service, the loss or permanent loss of use of one or both hands or feet or permanent visual impairment to a prescribed degree.

In the light of present conditions of military service, we believe that this monetary assistance should be made available to those induction period veterans (1) who have suffered severe impairment of mobility, which results from the amputation or loss of use of one or both feet and for whom an automobile can be considered as constituting, in effect, an additional prosthetic appliance; and (2) whose disability or disabilities were the direct result of armed conflict or were received while engaged in extrahazardous service (including such service under conditions simulating war).

This proposal would cost an estimated additional $184,000 the first year and, assuming that there is no change in world conditions and that the draft is extended, about $24,000 during each of the next 4 years.

Mr. Chairman, this concludes my formal remarks on these proposals. However, I and the members of my staff accompanying me will be pleased to answer any questions the members may have regarding specific proposals and will, of course, furnish any additional information or data which might be helpful to the committee in its deliberations.

Thank you again for the opportunity to appear.

Mr. Dorn. Thank you for a very good statement and for the one that you placed in the record.

Mr. DRIVER. Thank you.
Mr. Dorn. Mr. Kornegay?

Mr. KORNEGAY. Thank you, Mr. Driver, for coming this morning and presenting your fine statement. I certainly agree with the statement you made here and equalizing the payments of compensation for wartime and peacetime servicemen.

Mr. Dorn. Mr. Hanley?

Mr. HANLEY. Mr. Driver, you have touched on H.R. 171. I wonder if the other bills that were presented to this committee-are there any others that the administration looks with favor upon?

Mr. DRIVER. We cover each one in detail in the submission I submitted for the record. We don't favor any of the others in this area in terms of rate increases. Perhaps a better way to say it is, we have single out H.R. 171 as epitomizing the area that we feel most deserving

Mr. HANLEY. Thank you, Mr. Driver.
Mr. Dors. Mr. Fino?

Mr. Fino. I have no questions, except I want to say to the Administrator, it is gratifying to see him come here and present a positive rather than a negative approach.

Mr. DRIVER. Thank you, Mr. Fino.
Mr. Dorn. Mr. Teague?

Mr. TEAGUE of California. I would like to make this observation, if I may. As we all know, the cost of living has gone up some, and I predict it will go up some more, assuming that our disabled veterans like most of us, eat fruits and vegetables, either fresh or canned or both. Due to congressional failure to extend the program to help farmers get their crops harvested, this has resulted in the fact that we are going to have a shortage of fruits and vegetables in this country and prices are bound to be very much higher.

I realize you had nothing to do with this, Mr. Driver, but Congress did and the Secretary of Labor still does, and we are bound to have a material increase in the price of fruit and vegetables, both fresh and canned, during the rest of this year.

Mr. Dorn. Mr. Driver, we are glad to have you with us today. I think you made a very reasonable recommendation, one that will be seriously considered by the subcommittee.

Mr. DRIVER. Thank you very much, sir.

Mr. Dorn. Congressman Henry Gonzalez is the next witness. Mr. Gonzalez, we are glad to have you here, and you may proceed.



Mr. GONZALEZ. Mr. Chairman, members of the House Committee on Veterans Affairs, thank you very much for allowing me to appear before you personally today to testify in behalf of my bill, H.R. 1027, the ex-prisoner of war bill. I realize that this is the third day of hearings on veterans disability bills conducted by the committee this week and I will try to be as brief and to the point as possible.

I first introduced my bill during the 88th Congress on May 21, 1964, as H.R. 11353. The present bill, H.R. 1027, is identical in language to the earlier one. The fact that I reintroduced it this year on the first day of the new session, January 4, 1965, is some indication of the strong feelings and beliefs that motivate me in this matter.

The bill provides that any veteran who was a prisoner of war for 36 months or more shall be deemed to have a service-connected disability rating of 50 percent. It would apply to any veteran who was a prisoner of war during World War II or the Korean conflict. The 50-percent disability rating would be the minimum rating to which any veteran who qualified under the bill would be entitled. A veteran with no present disability rating would get an automatic 50 percent under my bill. A veteran with a present 40-percent disability rating would be entitled to an additional 10 percent, or a total of 50 percent. A veteran with a present disability rating of 50 percent or more would not be affected by my bill.

The granting of an automatic disability rating of 50 percent would be an extraordinary act of Congress. The justification for such an act would lie in the extraordinary circumstances which have given rise to the need for this relief. The number of veterans who would come under the law is a limited one, probably no more than 10,000 or 15,000. The figure grows less with each year that Congress fails to act.

According to a letter I received from the Department of Defense dated April 21, 1965, the total captured U.S. military prisoners of war during World War II was 128,782. The total for the Korean conflict was 7,152. In World War II, 14,090 U.S. military men died while captured; 114,692 were returned to the United States. During the Korean conflict, 2,699 died while captured; 4,453 were returned. Since a third of the U.S. prisoners during the Korean conflict died while captured, it is apparent that they suffered the same sort of harsh and inhumane treatment from their North Korean and Chinese captors as did the World War II prisoners from their Japanese captors. The significance of this for those veterans who would come under my bill will emerge during the course of my testimony. Only 400 veterans of the Korean conflict, at the most, could qualify under H.R. 1027 because only 400 Americans were held as prisoners 36 months or more and returned to the United States. Doubtlessly, many of these 400 have already died or are receiving disability benefits.

For World War II, it is estimated that of the 114,692 prisoners of war returned to the United States, 18,500 were held for 36 months or

Information relating to those veterans who fought in both World War II and Korea is not available. But I intend to learn those facts. A copy of the letter I received from the Department of Defense is attached to my testimony as exhibit 1.

Thus, it is seen that 18,500 Americans were prisoners of war during World War II for 36 months or more and returned to the United States. Combined with the 400 veterans of Korea, this brings a total of 18,900 persons who could fall under my bill. Of this number, many have died or are receiving disability benefits, which is how I arrived at my 10,000 to 15,000 estimate given at the outset of my statement.


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