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to receive the testimony of dozens of expert witnesses on what is being done and what needs to be done for the aged and aging.

Our findings were published in a series of studies and hearings and our recommendations were submitted to the Senate in a first annual report.

The subcommittee determined that its second year should aim at translating studies and reports into legislative proposals. Our report, we felt, should not be a passive document for libraries to shelve or for future generations to read. It should be a specific blueprint for action in a limited set of areas.

As a result we prepared and made ready a series of bills for introduction and for consideration of the Senate. Several of the bills were debated and voted on in the Senate; others were introduced, explained, and referred to the appropriate committees. This chapter is devoted to a brief description of each of the bills proposed, their disposition and the recommendations of the subcommittee for action in 1961.

MEDICAL NEEDS HAVE HIGHEST PRIORITY

In our first report, the "Aged and Aging in the United States: A National Problem (January 1960)," we said:

The No. 1 problem of America's senior citizens is how to meet the cost of health care at a time when income is lowest and potential or actual disability at its highest.

Again and again, elderly witnesses had emphasized to us that their greatest fear was of catastrophic or chronic illness which would wipe out their savings. (Over 71⁄2 million elderly people have liquid assets of less than $500, according to Federal Reserve Board figures.)

Our first recommendation, therefore, was in the field of medical care. In order to decide which health benefits were most critical we held a further set of hearings in April 1960 on the "Health Needs of the Aged and Aging." Subsequently, Senators McNamara, Kennedy, Randolph, and Clark-all members of the subcommittee-were joined by 19 of their colleagues in introducing the Retired Persons' Medical Insurance Act. The benefits under this plan would be made available to all retired persons including those eligible for OASI payments, those receiving public assistance, and others not covered by either of these Federal programs.

In this measure, emphasis was given to preventive medicine, by including payment of fees for diagnostic services. To reduce the possibility of overutilization of hospitals, skilled nursing-home care and home health services (homemaker services, physical and occupational therapy, etc.) were also included in addition to adequate hospital care. Last, but far from least, was partial coverage of drug costs. Many of our elderly witnesses had testified they avoided seeing the doctor because they were afraid they could not meet the high cost of drugs.

Financing of this program rested on an increase in OASI payments of one-fourth of a percent from employers and employees and an additional one-eighth percent increase on aid after 10 years. For those aged not eligible for OASI benefits, coverage would have been financed by contribution from the Federal general revenue funds, of which only a fraction would have been a net addition to the Federal budget, since a substantial sum already goes to old-age assistance and other Government programs providing medical care for the aged.

This measure was the one we considered a balanced and necessary starting point in the field. However, the medical care bill as it came to the Senate floor was primarily an improvement in the public assistance approach and did not tie medical benefits to the OASDI system, as proposed in our bill. It seemed, therefore, that an amendment of more limited coverage had the only chance to succeed. Senators Anderson, Kennedy, and McNamara, with seven colleagues, accordingly, introduced an amendment proposing that benefits along the lines outlined above be made available only to OASDI beneficiaries aged 68 and over (9 million persons).

but

The amendment was defeated by a narrow margin (51 to 44), it was nonetheless a legislative landmark-the first time a proposal to extend the OASDI system to include medical benefits had ever come to a vote in the Congress.

HOUSING THE ELDERLY

"The provision of safe, sanitary, and congenial housing at a rental which older persons can afford is a major unmet need," we said in our first report. Meeting that need will take a monumental effort since a sizable proportion of the elderly live in substandard housing; their housing requirements are frequently special, and their average income is far below that of other age groups. No single type of housing will fill this need. Requirements of the elderly change with advancing age, state of health, recreational interests, and, of course, income level.

The subcommittee feels that only by making housing for the elderly a vital and major part of the Federal housing program can the Nation begin to cope with the unfilled need. It commends the Housing Subcommittee of the Committee on Banking and Currency for its studies in this area and its effective sponsoring of needed legislation. The 1959 Housing Act included the first authorization for $50 million in direct Federal loans at low-interest rates, for the purpose of stimulating construction of low-rent housing for the elderly by nonprofit groups. Since there was no appropriation request from the administration for this item, a token appropriation of $5 million for fiscal 1961 was approved by the House of Representatives.

In 1960, Senators Kennedy, Clark, and Randolph joined Subcommittee Chairman McNamara in urging the Senate Appropriations Committee to approve an appropriation for the full authorized sum$50 million. A floor amendment by Senator Harrison A. Williams, supported by members of the subcommittee, resulted in Senate passage of the full $50 million appropriation. The Senate-House Conference Committee and subsequently the Congress approved an appropriation of $20 million, a minimal but necessary start. result, the Federal Government may now make direct loans to nonprofit groups at low-interest rates, to construct suitable, low-rental housing for older persons.

As a

Also sponsored by the Committee on Banking and Currency and approved by the Senate in the Housing Act of 1960 was an increase in the authorization for this direct loan program, to $75 million. A further provision authorized the Administrator of HHFA to insure that under both the direct loan, public housing and FHA programs, housing for the elderly would include health, social, and recreational facilities. This is a particularly significant provision for

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older persons, whose need for such services may be especially keen, but whose ability to avail themselves may be limited by failing faculties, or skimpy budgets.

The subcommittee would like to point out that it is of particular importance that low-income elderly be included in public housing and urban renewal projects, since many are concentrated in the substandard housing which is common to the decaying cores of cities. Their displacement by new housing developments and projects is frequently a dire hardship. Communities building public housing and pursuing urban renewal plans should see to it that the older population of the aged cores of their cities have other adequate housing to move to. Since 1956, it has been possible for public housing authorities to rent one-bedroom apartments to single people, a provision which is a great relief to the many elderly persons who are forced to live alone and who had previously been excluded from public housing. The Housing Act of 1960, as passed in the Senate (but died in the House), would have increased the Federal subsidy up to $120 per year for each elderly family in public housing. This additional contribution would help maintain the solvency of public housing projects, while increasing the number of units of public housing available to elderly of very low incomes. Passage of this provision in 1961 by the Congress should be an early legislative objective.

The subcommittee looks forward to vigorous administration and dynamic growth in the housing for the elderly program. For a substantial minority of senior citizens, poor housing is a painfully acute problem, which has fundamental affect on morale and good health at that time of life when both are most precarious. In addition, few factors are more important to the encouragement of independent living than proper housing accommodations, equipped with or near to necessary medical, social, and recreational services.

The $75 million direct loan authorization is a good starter for the Federal program in this field, but should be increased to $100 million for fiscal 1962, with future increases as demand warrants.

AGE DISCRIMINATION

Like all prejudices, age discrimination flies in the face of facts. Studies have shown that older workers tend to be more reliable than their younger colleagues, and that their rate of absenteeism is lower. Yet age discrimination is a persistent problem on which fair-employment-practice laws have just begun to make a dent. For workers from 40 to 65, age discrimination constitutes an especially formidable barrier to employment, and for workers over 65, it erects a roadblock which is impassable by the great majority.

Ours is an era of rapid and ruthless industrial change. Automation in old industries has brought an end to the need for many old skills. As States vie with each other in the field of tax incentives, relocation of whole industries has become routine. Mergers, and the dramatic rise and fall of both new and old industries, wreak havoc with such accepted practices as "seniority" and "reemployment rights." At the same time, relatively little planning of any organized kind goes into studying and attempting to ameliorate the human affects of these changes. In this soil, age and other kinds of employment discrimination flourish.

The subcommittee believes that the Federal Government must take the lead in outlawing this senseless prejudice. Eleven States have already done so. Senators McNamara, Clark, and Randolph have therefore introduced a bill to eliminate discriminatory practices for reasons of age, by Federal Government contractors and subcontractors. It was referred to the Committee on Labor and Public Welfare. Enactment of this legislation would set a precedent for all employers. It would focus public attention on the problems and the progress being made to deal with it through periodic regional conferences to be called by the Secretary of Labor for the orientation of labor and management groups.

The McNamara-Clark-Randolph bill would set the pace for the Nation in ridding itself of myths about age and about employment and in planning ways to reduce this baseless prejudice.

CONSTANT PURCHASING POWER BONDS

One of the prevalent myths about the elderly is that many of them have handsome fortunes tucked away in their socks, their mattresses, or their safety deposit boxes. As the figures show, this is unhappily far from the truth. In addition, those who have been able to store up a nest egg for their later years have inevitably suffered from inflation and have fallen behind in the general trend toward a rise in the overall American standard of living. Workers are protected against rising costs to some degree by wage increases, escalator clauses in union contracts, etc. But pensions are not so protected, and savings put aside with high hopes in prosperous times are also not protected.

To deal with this problem, Senators McNamara, Clark, and Randolph joined in a bill which carries out one of the recommendations of our first report: the issuance of "constant purchasing power" Government bonds. Under this bill, referred to the Committee on Banking and Currency, individuals could buy up to $60,000 in such bonds for redemption, either in 20 years or on retirement, at face value and accrued interest plus adjustments for any intervening rises in living costs. Institutions, such as welfare pension funds and insurance companies could also buy these bonds to back up their obligations under their pension plans. If redeemed before maturity, the bonds would pay only the regular interest rate in addition to the purchase price.

A second, but important part of this program, could be an increase in the sales and holdings of Treasury savings bonds. Redemption of these bonds before maturity has been a major source of concern to the Treasury.

When people save for retirement, they are interested in the most secure form of savings. They don't want risky savings instruments. Government bonds have long been considered as the most reliable forms of investment since they do not fluctuate with monetary trends. But in inflationary times, many people shy away from buying bonds since the danger of inflation removes the most important characteristic of bonds-their risklessness. When bonds weaken as a result of inflation, many people, and especially the small, unsophisticated investor saving for his old age, is deprived of the form of investment he

understands best. Thus, the inclination to save for the rainy day of old age decreases, and economic insecurity in the latter years increases. This fear has given rise to many efforts to tie annuity programs to stock market investments or to the price level. It has been contended that fixed pension plans cannot meet changes in the cost of living.

But if pension funds could be invested so as to be protected from the erosion of inflation, it would be possible to write pension contracts with cost-of-living provisions; and an inflation-proof pension bond issued by the Treasury would increase the incentive of individuals to save for old age-either on their own, or through labor-management pension plans. In addition, to the extent that these bonds would induce people to save more, they might have a dampening effect on inflation. As the staff report on "Employment, Growth and Price Level" of the Joint Economic Committee said recently:

*** There is much to be said for the view that it is a proper function of the Government to provide the small, unsophisticated investor with a form of investment which contains protection against the erosion of his wealth through inflation.

While the constant purchasing power bond is not a new idea, it has never been tried in this country. The dimensions of the economic problems of our aging population suggest that this proposal gives the kind of new direction in which we should be moving in this field.

SENIOR CITIZENS SERVICE TRAINING ACT

Our picture of the senior citizen as a superannuated, crotchety old party is clearly outdated. Longevity has made 60 or 65 a part of the middle of life for more and more of us. For women, this is particularly true: one in every four alive today will live to be at least 85. A further illumination of what the elongated lifespan has done is the fact that one out of three persons aged 60-64 has at least one living parent or other relative to be concerned about, and that proportion will rise to two out of three by the end of this century.

The need to make 15, 20, or 25 years of retirement meaningful becomes even more obvious when one considers our rising educational level. Intellectual curiosity does not stop: the old saw that you cannot teach an old dog new tricks is false. The person who had had an advanced education and a stimulating career ought to be able to look forward to the opportunity of going on as a creative, contributing member of society.

Also, for the many whose aged parents must be at least partially supported, this must frequently be a period of continued earning. Since it is the time of life when age discrimination in employment is most intense, retirement can become a terrifying economic scramble.

There is an increasingly great need today for people to work in the service agencies of their communities-hospitals, libraries, schoolsand this would seem to be an ideal area for senior citizens to enter. Senators McNamara, Randolph, and Clark, and 11 colleagues introduced a bill, referred to the Committe on Labor and Public Welfare, to provide for the establishment of a senior citizens service training program. With leadership from the Department of Health, Education, and Welfare, training and refresher programs would be set up

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