I wouldn't be surprised that at the next national convention of the DAV held in Chicago next week, and at which Senator Johnson has very kindly consented to speak, that we will go on record as advocating that totally disabled veterans should receive the same dependency allowances as the dependents received while the veteran was in active service.

Senator Johnson was the author of that bill to provide allowances for the dependents of those in the active service. It seems ironic that when that man has sacrificed his health, those dependency allowances are discontinued, as well as the man's board and lodging.

For example, if he had a wife and five children, she would be receiving $160 a month while he was in the service, but when he comes back, no longer fit, then the $160 is discontinued, the allowances he was getting, togther with his board and lodging, are discontinued. Then if he puts in an application and proves himself to be totally disabled by reason of disabilities incurred in military service-and that might take time, depending on how good the records are in the file-and if locateable-he could then prove himself entitled to not more than $115 a month unless he lost a limb or an eye, with no dependency allowances. In other words, he would get $45 less per month for himself, his wife, and five children, than the wife and five children got while he was in the military service, not counting his board and lodging and his pay of $28 per month or more.

That seems a very unfair situation and something ought to be done about it soon. We think it is a matter of pressing importance that

ought to have the first consideration of this committee.

More and more of these men are becoming disillusioned, completely disillusioned. They are wondering what they fought for. They have lost the American way of living after fighting for it.

Now, therefore, the first thing to be reported out of this committee is Senator Johnson's bill, S. 1031, and if it can't be reported out as an independent bill, and there is a conclusion that the amendments to the so-called GI bill of rights are going to be enacted into law, that ought to be attached to whatever bill is going to be reported out.

Whatever method is used, it deserves to be reported on as soon as possible.

Now, a million and a half, and possibly 2 million disabled veterans may be favorably benefited by this. They still are the first obligation of the Nation.

There might be 10 or 15 million veterans eventually affected by the so-called GI bill of rights, if they all take advantage of it.

If there is to be a GI bill of rights, the veterans ought to be entitled to participate in it on an earned basis rather than on a needs basis. I realize that the committee has a good many other bills that it wishes to discuss. I don't know whether you propose to discuss all of those bills during one hearing

Senator MILLIKIN. Mr. Rice, I didn't understand your remark as to the earned basis.

Mr. RICE. I mean to point out that the so-called GI bill of rights is not based on an earned-merit basis, but primarily on a needs basis. The veteran gets unemployment-compensation benefits because he needs them, not because he is entitled to it. If he is employed, he doesn't get the unemployment compensation benefits. If he shows

good faith and tries to take care of himself, he doesn't get it. As the benefits are received now, there is an inducement to idleness. There ought to be an inducement to be gainfully employed.

There is an inducement to the employer not to employ the veteran. If the veteran is entitled to so-called readjustment allowances which utterly fail to readjust him he can get higher unemployment compensation by reason of the so-called GI bill of rights than he would get under most State laws. So if there be a choice on the part of the employer either to employ or not employ the veteran on some project, the employer would be apt to say to himself, "If I discharge this nonveteran to give a job to this veteran"-and it might be the father of the veteran-"then he will be entitled to State unemployment compensation benefits," which reflect themselves in an increase in his State taxes which the employer doesn't want. He would decide that since he can't employ both the nonveteran father and the veteran son, he should employ the nonveteran. If he had the choice, he would say, "The son is entitled to higher Federal unemployment-compensation benefits through the so-called GI bill of rights than the father would be entitled to under the State law, and there will be a greater income in the family if I don't employ the son and continue to keep his nonveteran father on the job."

And the son may, therefore, be persuaded that he is doing the patriotic thing, so far as his father is concerned, in remaining unemployed, and also as far as the employer is concerned, because of the State taxes.

Of course, his taxes will be reflected in the Federal level, but then he would thereby avoid an increase in his State taxes.

A much better method would be on an earned-merit basis. I mean by that, assuming that he has earned something by reason of having served his country. He missed out on civilian opportunities. He missed out on a civilian salary. He missed out on civilian opportunities to make himself secure in his job. He ought to be paid for it. Senator MILLIKIN. You are referring to a bonus, certainly. Mr. RICE. I am. Call it a bonus, but I would call it adjusted compensation. He should now be compensated. Let's do it on an earnedmerit basis so that he can be his own boss, without having a bureaucrat tell him what he is entitled to. Let him have what he has earned.

We advocate that it should be computed on the basis of $3 per day of service in this country, and $4 per day overseas, and that it should be issued to him in the form of what might be called a readjustment insurance policy which could be used as an insurance policy, payable at death, or payable at the end of 10 years without any questions asked at all, or let him keep it longer to make it the equivalent of a bond.

We have to have Government bonds, so give him an inducement to keep that bond for a rainy day. Pay him 3-percent interest compounded. But he may need it, so let him use it if he wants to on the basis of his needs by being given the privilege of redeeming it in part in monthly amounts, let's say, not exceeding $100 a month while unemployed, or while going to school, and in larger amounts for the purpose of buying or building or improving a home, or a farm, or a business.

Let it be the choice of the man without this tremendous bureaucratic machinery we have that is overloading the Veterans' Administration.

I appeared before this committee a year and a half ago and prophesied that the policy of trying to administer all of these laws through one agency was not going to make it possible to coordinate them. It sounded as though you could go up to one desk and get all of the benefits, but that is not possible. It isn't practical. I then prophesied that the central office would probably soon divide itself into five or six offices if it got all those additional responsibilities.

We took an informal inventory at lunch the other day, and as far as our knowledge revealed—and we didn't go into the matter exhaustively we found there were nine different buildings in which the central office of the Veterans' Administration is located in Washington, D. C., in addition to three different buildings in New York City, where they dictate the correspondence here and send it on to New York to be transcribed.

We can't solve all of the economic maladjustments of all veterans through one agency. That is not any more sensible than to try to solve all of the economic maladjustments of all civilians through one agency. It can't be divided up between veterans and nonveterans. It will have to be done on the over-all basis.

I think it can be solved on a preference basis for the disabled veterans, because they constitute only 3 to 4 percent.

We believe strongly that the disabled veterans who incurred injuries are entitled to specific preference methods, compensation, medical treatment, out-patient treatment, special preference for Government employment, subsidies, but still we do not have confidence that all of the maladjustments will be solved that way. There are too many of them.

When you take all the veterans, it cannot be expected to solve all of their problems through one agency. We are not doing it. We don't attempt to put the disposal of surplus property in the Veterans' Administration. There are various other things pertaining to veterans that have to be solved by other agencies.

It wouldn't be practical to have two employment services, one for the civilian and one for the eveteran. Then the employers would have to make a choice as to which service to call up. The veteran might get the small end of that deal eventually.

And so I say that the philosophy on which the so-called GI bill of rights was enacted ought to be revised, that the administration of several of those benefits should be transferred to several other governmental agencies that have had a background of experience. The agricultural loans ought to be made the responsibility of the Farm Security Administration. The home loans should be made the responsibility of the Federal Housing Administration. The business loans should be made the responsibility of the Smaller War Plants Corporation or of the RFC.

Those agencies have had a background of experience. They can. give those fellows advice and counsel.

As a matter of fact, a veteran can get a much more liberal loan, in a greater sum, frequently, of Federal money through the Farm Security Administration than he can get through the so-called guaranteed loan.

If he is going to use the guaranty of the Veterans' Administration, he gets a loan of $4,000, but he can go to the Department of Agriculture and get a loan of $12,000 or $15,000 to buy a farm.

He can also get advice and counsel regularly of an agricultural county agent. I don't expect the Veterans' Administration to provide agricultural advice in addition to all of its other duties. You have the same situation with respect to the Smaller War Plants Corporation. They would be in position to follow the thing through.

The Veterans' Administration handles too many things to do that. The Veterans' Administration has a tremendous load to carry in respect to the disabled veterans without being imposed with these additional responsibilities primarily on behalf of able-bodied veterans. What happens is that the Administrator and the general counsel and all of the top officials have to spend so much time with the complicated technicalities that they have very little time to solve the ever-increasing problems of the disabled veteran.

Now, what are we going to do about it?

Well, we can continue to liberalize and amend, so as eventually to give all of them some of such GI benefits, until the Budget won't have it, or we can provide an adjusted compensation bill that will take it out of bureaucracy and out of these technicalities and let the man have it according to the way he earned it, and then let him redeem it as he needs it or wants it.

I dare say that 90 percent of the veterans would prefer, 90 percent of the overseas veterans, I daresay, would prefer it. So would the disabled veterans.

The disabled evterans get practically nothing out of the GI bill which he wasn't entitled to before.

There has been much misconception. It has been assumed that the disabled veterans were getting something out of the GI bill of rights. They get very little. In some instances they have to make a choice as to which they will elect. Disabled veterans have earned the right to vocational training by reason of service-incurred handicaps. Then if it be said that the veterans generally have earned the right to get educational training, these disabled veterans ought to have the privilege of getting that too.

What is the situation now?

A disabled veteran can get most any kind of vocational training course, based on his background of education and experience and aptitude, but it cannot exceed 4 years. It must lead to the opportunity for suitable and gainful employment. If it doesn't lead to that at the conclusion of his period of vocational training, he may not be permitted to take that course.

Therefore, if a disabled veteran has a desire to take a course of training, such as to make him an attorney, and it is going to require 5 years, he may not be permitted to start such course at all.

The disabled veteran should have the right to switch from Public 346 to Public 16 or vice versa at any time that it is to his advantage to do so. He ought to have that privilege.

Now, under the law as interpreted, if a disabled veteran has been found to be eligible for vocational training under Public Law 16, and didn't know about it before, and was getting vocational training under Public 346, he is forced to make a choice.

Suppose he was getting a fair amount of compensation for his service-incurred disability. Under Public 346 he would be entitled to get $50 additional, or $75 if he had dependents, while pursuing the course of education. But if he has a handicap, he has to make a choice. He can't get Public 346 and Public 16 training. So he may be thwarted in his ambition to reach a particular objective because of the necessity of making that choice. That ought to be eliminated. He ought to be able to get one after another successively under the theory that he earned the right to Public 16 training by his disability and to Public 346 education by his service.

If it is going to be accorded to able-bodied veterans under 346, he ought to be entitled to that also.

Well, now, Mr. Chairman, I probably have dealt too long concerning some of these gripes on behalf of the disabled veterans, but I could give you a good many more. I would like to insert in the record an outline of the policies and objectives of our organization which will outline those several additional objectives which we consider to be very important.

(The matter referred to will appear at the end of Mr. Rice's statement.)

Mr. RICE. Mr. Chairman, I would like to call your attention to one more matter which is of great importance. That is the fact that under the present law, if a single veteran requires hospitalization in a Veterans' Administration hospital, he may not be permitted to receive more than $20 per month. Therefore, if he is totally disabled and entitled to $115 and requires hospitalization, and he goes into a Veterans' Administration hospital, his compensation is reduced from $115 to $20 per month.

In other words, he is, in effect, required to pay $95 a month for his hospitalization.

If he is a single veteran who has lost two legs and therefore entitled to $200 a month, and he requires treatment for one of the stumps in the hospital, his compensation would be reduced from $200 a month to $20 a month. He would in effect be required to pay $180 a month for his hospitalization.

If he lost his two legs 25 years after his service, then he could be accorded treatment without any deduction and he would still get his $8 per month by reason of a non-service-connected disability.

That is a discrimination which is proving to be disillusioning to an increasing number of discharged veterans of this war, who think it is a lousy deal. While in military service, they are permitted to receive their full pay, but as soon as they become civilians they begin to find they are discriminated against. Veterans without dependents will not be permitted to receive more than $20 a month compensation while in a hospital.

Now, the $20 a month is not enough. Many are denied hospitalization because they cannot afford to take it presently as they have financial obligations that have to be liquidated.

The chairman has indicated that his bill, S. 1203, which would in part relieve that situation, is to come up subsequently. I think it is a bill of great importance, and one that deserves consideration soon, because it pertains to benefits of disabled veterans, but I will refrain from going into all of the provisions of that bill with the under