The Veterans of Foreign Wars has an estimated membership of 100,000, of whom it is estimated 80 per cent are World War men. Disabled American Veterans is composed entirely of World War men, so that the proponents of the bill appear to be all World War men, who have nothing whatsoever to do with the Pension Bureau and therefore should not be concerned in any way as to whether it is consolidated in the Veterans' Bureau or left as it is. On the other hand, the United Spanish War Veterans' Association has a membership of 113,000, or nearly 30 per cent of the total who served in the war and probably 50 per cent of those living and their opinions, therefore, undoubtedly represent the general feelings in the matter. These you will hear from later, I understand, from a representative of the organization, but I am told that they are opposed to the ab sorption in the Veterans' Bureau.

The CHAIRMAN. I do not like to create a situation here where too much friction appears between department heads of the Government, but I want to call attention to the fact that at the present inmates of National Homes for Disabled Volunteer Soldiers are perhaps 75 per cent veterans of the late war. I do not have the exact figures. Commissioner CHURCH. About 60 per cent are veterans of the late

war.

The CHAIRMAN. Now, of course, the contention of the American Legion is that inasmuch as these homes are now rapidly filled up with World War veterans at an ever-increasing ratio the only logical thing to do is to have these homes taken over by the Veterans' Bureau. Do you agree with that suggestion?

Commissioner CHURCH. That has, of course, no reference to the Pension Bureau.

The CHAIRMAN. None at all.

Commissioner CHURCH. It relates entirely to the homes. Answering that, I would say that the hospitalization service was set up by the United States Veterans' Bureau immediately after the war, supposedly to take care of wounds and the immediate effects of war on the soldiers in the war. In due time that was shaken down until today practically 70 per cent, according to General Hines, of all compensation cases are permanent, which means nothing more nor less than a pension; and I foresee the time when those will be transferred to the Pension Bureau and paid these pensions.

Correspondingly, answering directly to your question, when hospitalization becomes permanent in the condition of the patients, it becomes simply domiciliary and can very properly be placed under the National Home for Disabled Volunteer Soldiers.

The CHAIRMAN. Can you not see an inconsistency in maintaining two organizations dealing directly with the veterans of the late war? It seems to me that at least as to the veterans of the late war, it would be a material advantage to have the national homes and the hospitals of the Veterans' Bureau under one head, so as to more effectively segregate the domiciliary cases from the hospital cases. Hospital cases cost a whole lot more than domiciliary cases?

Commissioner CHURCH. True; and I believe domiciliary cases should be transferred to the national homes under this proposed act of mine through the coordination of the Assistant Secretary. The difficulty with transferring them to soldiers' homes and hospitals

under the Veterans' Bureau is the leveling up of costs to which I referred. According to the last annual reports, complete hospitalization of a bed case in the National Soldiers' Home costs $2.39, and in the Veterans' Bureau over $4. When the Veterans' Bureau gets that home, what guaranty have you that they are going to keep the $2.39 and that it is not going to jump up to $4?

The CHAIRMAN. Yes; but why may the results not be just the opposite? Transferring domiciliary cases to the national homes might have the result of reducing the expense at the veterans' hospitals.

Commissioner CHURCH. Because, answering the question, if I may-you asked Congressman Knutson also along that line-when you get 11 homes and there are 50 hospitals; when you get a personnel of 600 in the Pension Bureau, as compared with 24,000 in the Veterans' Bureau, the lesser has very little weight with the greater. They are simply swallowed up and in policy the smaller unit will not be reflected in the greater.

The CHAIRMAN. Let me ask you this question, if you care to answer it.

Commissioner CHURCH. Yes, sir.

The CHAIRMAN. What would you think of the idea of abolishing all three divisions as such-the Pension Bureau, the National Board of the Homes, and the Veterans' Bureau, and creating an entirely new activity, by whatever name; and then give the President an opportunity to organize from the top down? Would that be preferable to the consolidation under the Veterans Bureau?

Commissioner CHURCH. No; because you would first have to transfer your organizations intact as they are, or you would disrupt everything. You might call it something else. You might officer it with a new personnel. But it would amount to the same thing in the last analysis as my proposal of creating a new assistant secretary and transferring the two units over under the Interior Department and having coordination there.

Right along that line, may I say, Mr. Chairman, that I foresee in the future a consolidation under this plan of mine, and that consolidation is going to work out along the lines of what I believe is the survival of the fittest, namely, the National Home for Disabled Volunteer Soldiers and the Pension Bureau. In due time, as more of the Veterans' Bureau patients become permanent in their disabilities, and therefore domiciliary although requiring hospital care, those will be transferred, unit by unit, to the national home, which is administering at such low cost; and the same way, 70 per cent of all this compensation paid to-day could very well be placed in the Pension Bureau. We could make the plates for them, and send the checks out every month at a cost of less than 11 cents a check, the same as we do with those we are handling now.

The CHAIRMAN. What does it cost in the Veterans' Bureau for mailing the checks?

Commissioner CHURCH. I do not know. The testimony given last year by former Senator Means cited the experience of President Harding's time, in which they figured 33 cents. I can foresee in time the merging of the compensation activities in the Pension Bureau over a period of 10 years by a gradual absorption, without disturbing anybody, of the hospitalization in the National Homes, of the insur

ance in the retirement division of the Pension Bureau, where we are fully set up and equipped to take it over. And I might say frankly that so far as the Pension Bureau is concerned to-day we have got a Civil War section, we have a Spanish War section, and we can just simply create, so far as compensation is concerned, a World War section in between the two, and take it over.

My thought is, directly following Secretary Wilbur's suggestion, that in the course of 10 years, possibly by successive legislation year by year, asked for from Congress as things are worked out, you would accomplish this consolidation without tipping over anybody's apple cart.

I have just one more thing in conclusion, and that is this: I want to say that the Pension Bureau has handled ever war from the institution of the Government down to the present time, with the exception of the World War; and the special machinery for that was set up to avoid pensions, and it did not do it. Compensation is nothing but pensions under another name; and, further than that, pensions are coming just as sure as fate. So why not break down this collosal figure and build up better with the existing agencies? Mr. COLTON. I understand Colonel Church to say here that this legislation does away with the Pension Bureau, from which veterans have received such satisfactory services. Am I to understand that the chairman interprets his bill to mean that this legislation, if enacted, would do away with the Pension Bureau?

The CHAIRMAN. No; the bill does not do away with the Pension Bureau; it simply transfers the duties of the head of the Pension Bureau to the Director of the Veterans' Bureau, who will occupy the same relation to the Pension Bureau that the commissioner does

now.

Mr. COLTON. My understanding is that we do not do away with anything. We maintain them; we maintain all their efficiency, even if this bill were enacted. I am not, however, expressing an opinion on the bill.

Commissioner CHURCH. What does this word "consolidate " mean? "Consolidate" means to bring together and merge.

Mr. COLTON. It does not mean to destroy. You say it would do away with the Pension Bureau.

Commissioner CHURCH. All right. I will say this, if you passed that bill, and if I were Director of the United States Veterans' Bureau I would proceed, first, to have the Pension Bureau brought physically over to the Veterans' Bureau Building, and then I would proceed to absorb that personnel throughout where they would work in most efficiently with other personnel; and in time some one might handle a pension case and a compensation case on the same desk, if that turned out most efficiently; and in five years you would find no vestage of the Pension Bureau. Is not that true?

Mr. MONTET. I think you are right. It is certainly permissible under the bill.

Mr. COLTON. Under your bill it will mean in the course of 25 years a complete merger of all these activities? That is, by a gradual process the activities will be merged.

Commissioner CHURCH. Step by step, and as Congress authorizes and after being studied and recommended.

Mr. COLTON. But consolidation under the Williamson bill will not do away with the service; it continues the service the same as your bill, except that you do it under different conditions.

Mr. BEEDY. You are both talking about whether the entity of this Pension Bureau as it now exists would be destroyed as such?

Commissioner CHURCH. That is true. Do we not agree after all? Mr. COLTON. Yes; but the service will not be done away with.

Mr. CROSS. There is one statement in reference to the cost per day of patients, one being practically $2 and the other $4. Is that difference in expense by reason of more attendants of the Veterans' Bureau patients and better housing conditions, or what do you attribute that difference in expense to?

Commissioner CHURCH. Naturally, I can not answer that without going into the Veterans' Bureau policy of administering hospitals and the Soldiers' Home and I do not feel qualified to speak on that. But let me call attention to one factor-that the total administration cost, the office cost, the overhead of General Wood's organization, is $58,000; and you can figure what it is for Director Hines's. That is one factor. General Hines's charts will undoubtedly show you the proportion of attendants to patients, and General Wood's will do the same. That would answer your question.

The CHAIRMAN. The committee will now adjourn to meet tomorrow morning at 10.30 o'clock.

(Thereupon, at 12.35 o'clock p. m., the committee adjourned to meet to-morrow, Friday, January 17, 1930, at 10.30 o'clock a. m.)

HOUSE OF REPRESENTATIVES,

COMMITTEE ON EXPENDITURES IN THE EXECUTIVE DEPARTMENTS,

Friday, January 17, 1930.

The committee met at 10.30 o'clock a. m., Hon. William Williamson, chairman, presiding.

The CHAIRMAN. The committee will be in order.

ADDITIONAL STATEMENT OF COL. EARL D. CHURCH

The CHAIRMAN. I believe that the Commissioner of Pensions did not have time to complete his testimony yesterday, and we still have 35 minutes before the noon hour. We, therefore, will be very glad to hear such testimony as he cares to submit this morning. You may proceed, Colonel.

Commissioner CHURCH. Mr. Chairman and gentlemen, I desire to make just a very brief preliminary statement.

The provision in the bill now before the committee, H. R. 6141, for consolidation with the United States Veterans' Bureau, does away with the position of the Commissioner of Pensions, which I now occupy. Lest my strong opposition to this bill may be misunderstood as due to the effect it would have on me personally, I desire to make this brief statement:

I did not seek the position of Commissioner of Pensions. I have no intention of making the Government service my career, but upon completion of my tour of duty here plan to return to my former

business connection with an insurance company of Hartford, Conn., which I have served for 33 years. My opposition to the consolidation as proposed by this bill is, therefore, entirely disinterested, except in so far as it affects me as a taxpayer, and is based solely on what I believe to be in the best interests of the Government, the country at large, and the veterans of the various wars.

Now, Mr. Chairman, this question of consolidation as constituting a merger keeps coming up, and you have suggested, sir, that that bill does not disrupt the Pension Bureau policy except that the Director of the Veterans' Bureau takes the place of the Commissioner of Pensions, but that it does not mean, in your opinion, a complete absorption of the Pension Bureau. Am I right, sir?

The CHAIRMAN. That is correct. I can say it does not mean the complete disruption in the sense that the Pension Bureau will be eliminated. The Pension Bureau would continue to function the same as it has, or approximately the same, in the new organization. Colonel CHURCH. Yes, sir. It seems to me that the only way you could accomplish that purpose, then, would be to have the bill changed so as to make the Director of the Veterans' Bureau Commissioner of Pensions and president of the Board of Managers of the National Home for Disabled Volunteer Soldiers.

If I may, I would just like to read a short paragraph from General Hines's letter to you, and which was read into the record at the beginning of his testimony:

Many of the activities of both the Pension Bureau and the National Home for Disabled Volunteer Soldiers, together with the personnel engaged therein, could be assimilated by the present services of the bureau with a consequent reduction in the total number of employees. For example, the finance service of the Veterans' Bureau could take over the disbursing work of both agencies. Out goes the finance division of the Pension Bureau.

Similarly, the adjudication service, which has charge of the allowance of claims for compensation, insurance, adjusted compensation, etc., might assume the responsibility of handling the pension claims, with the resulting reduction in total personnel.

Out go 250 more people concerned solely with the adjudication of of pension claims.

Now, it seems to me, Mr. Chairman, it is purely a question of figures pertaining to the total number of personnel. In the Pension Bureau we have approximately 600 employees, the Veterans' Bureau approximately 24,000; or, in other words, the personnel of the Pension Bureau is one-fortieth of that in the Veterans' Bureau. Now, how much leavening effect, even if we are efficient, is onefortieth of the total staff of the Veterans' Bureau going to have when we are moved over there? Or let me put it another way. Onefortieth of the 600 we have is 15; and if you transfer a bureau of the Government to the Pension Bureau with 15 clerks, I would simply say to Doctor Wilkinson, my chief clerk: "Well, Doctor, clean out some small room down there. Put these people in there and pick up their duties and absorb them in the 600 people." The 15 would then lose their identity in three months. That is what consolidation is for, to effect efficiency and reduce personnel, and the same thing will result when 24,000 people take over the 600, because the proportions are exactly the same.