Without Government help, the building industry cannot afford to build a house selling for much less than $10,000 (and in many cases it is more than that), nor a four and a half room apartment renting for less than $80 for a month. We have no specific quarrel with the building industry as such, but we do feel that the facts command the conclusion that our present housing crisis will not be alleviated without the adoption of a comprehensive Federal housing program. The American Veterans Committee feels that the bed-rock requirement for meeting the housing crisis is the Taft-Ellender-Wagner bill. This bill is geared to meeting our minimum needs of 1.5 million new permanent homes per year for the next 10 years, and offers hope of the production of moderately priced homes at more reasonable prices than are presently possible. The major provisions of S. 866 deal with financial aids and guarantees to expand rental and sales housing construction. I am sure there is no need for a detailed description of the provisions enunciated so ably by Senator Taft. The yield insurance provisions are important as a means of attracting large investment funds and guaranteeing their return just as is done now with mortgage loans. The extended period of amortization which is part of the yield insurance plan is both sound and helpful in achieving lower rents. The American Veterans Committee reiterates its wholehearted support of the slum clearance and redevelopment provisions of the bill which should enable a successful attack to be made on the long accumulated blight of our cities. These provisions would make it possible for the cleared areas to be reused in the manner the cities determine most suitable including public or private housing, commercial or public buildings. The public-housing provisions are imperative as they represent the only means for providing homes for families of low income. There are many veterans who are in the low-income group, and S. 866 requires that these veterans be given a preference for a period of 5 years after enactment. In line with the comprehensive character of this legislation, we are gratified to see there is an equally comprehensive program for rural and farm areas. Title III of the bill authorizes the Housing and Home Financing Agency Administrator to undertake a program of technical research aimed at progressive reduction in housing costs. This section can have and I hope will have-important long-range results if an aggressive effort is made to develop new techniques and materials and provide assistance to the infant industrialized housing industry, sometimes called the "pre-fab" industry. The present methods of producing housing are outmoded in this age of mass production and with sound research means should be found to reduce home-building costs considerably. Attention should be given to the removal of antiquated municipal building codes. These codes force up the cost of homes without providing any vital improvement and in many cases make erection of industrialized housing virtually impossible. Veterans are particularly interested in the assistance which is provided to nonprofit housing cooperatives comprised primarily of veterans. By authorizing loans for 95 percent of the cost of the project with 4 percent interest rates and a 40-year amortization period, the bill should make possible the construction by veterans of special projects to meet their needs. In summary, gentlemen, I want to urge this committee to approve S. 866 basically as it was passed by the Senate. We believe that only by the type of balanced bill which was recommended by the Joint Congressional Committee on Housing, later approved by the Senate Banking Committee and passed by the Senate, can Congress adequately meet the housing crisis. On the basis of recommendations made by the Joint Housing Committee, the bill has been modernized and brought into alinement with current conditions. The adoption by the Senate of the Flanders amendments has produced a bill which is based on a firm foundation, first, of 10 years of continuing study, and, second, of the intensive survey of current conditions which the joint committee made. We further urge that this committee act as quickly as possible so as to assure that the members of the House will have an opportunity to vote on this legislation before the last-minute adjournment rush. I am sure that veterans all over the Nation are eagerly awaiting the decision of this committee. Housing has been repeatedly demonstrated to be the number one problem of veterans and they regard housing as one of the most important issues facing this Congress. In the name of human decency, gentlemen, do not fail them. I have also though I will not bother to read it-a two-page summary of the specific sections in the act which benefit the veteran, and I would like to submit that for the record. The CHAIRMAN. Without objection that may be inserted in the record at this point. (The document above referred to is as follows:) How S. 866 WILL HELP THE VETERAN GENERAL The comprehensive attack provided in S. 866 on the basic items of housing costboth construction costs and financing costs-and the sustained high level of housing production that the S. 866 provisions are designed to produce, would in general be of definite assistance to veterans who are in need of housing. Actually, the S. 866 programs would operate first of all in favor of veterans in view of the fact that the Housing and Rent Act of 1948 has continued for at least another year the statutory provisions providing for mandatory preferences to veterans on new housing built for sale or rental. FEDERAL HOUSING ADMINISTRATION TITLE VI HOME AND RENTAL HOUSING PROGRAMS 1. S. 866 (title I) continues for another year the Federal Housing Administration title VI program of liberalized mortgage insurance aids (for both individual homes and rental housing) required to meet current needs. It will be noted that title VI provides that the Federal Housing Administration Commissioner "shall prescribe such procedures as in his judgment are necessary to secure to veterans of World War II, and their immediate families, and to hardship cases ** * preference or priority of opportunity to purchase or rent properties covered by mortgages insured under this title VI." 2. S. 866, in extending the Federal Housing Administration title VI program, adds a new section 611 providing for aids to builders to assist and encourage the application of cost reduction techniques through large-scale modernized site construction of housing and the erection of houses produced by modern industrial processes. In so doing, S. 866 specifically provides that "Preference or priority of opportunity in the occupancy of the mortgages property for veterans of World War II and their immediate families and for hardship cases shall be provided VETERANS' COOPERATIVE OWNERSHIP HOUSING In order to encourage and make possible home ownership for those families of lower income who could undertake such housing only under a cooperative ownership housing plan, S. 866 makes available for such housing Federal Housing Administration insurance of a liberalized combination of mortgage terms-a 90-percent loan, 40-year maturity, and a maximum of 4-percent interest rate. For veterans' cooperative ownership housing, S. 866 liberalizes these terms still further by making available to them Federal Housing Administration insurance on 95-percent loans. PUBLIC LOW-RENT HOUSING S. 866 (title VI) provides for various special preference to veterans in connection with low-rent housing projects undertaken under the additional authorization provided in S. 866, as a result of which the new program will operate first of all on behalf of veterans of low income. Specifically, S. 866 provides: 1. Preference in admission to veterans of low income for the next 5 years. 2. A first preference to disabled veterans. 3. A waiving, with respect to veterans, of the requirement in S. 866 that families of low income admitted to low-rent housing projects come from substandard housing. 4. For elimination of pensions received in connection with service-connected disability in determining net income for the purposes of admission of veterans to low-rent housing projects. 5. Extension of the preference for admission to the families of deceased veterans (and also servicemen who died in service). 6. Authorization for conversion of veterans' housing projects undertaken under state law so that they may obtain Federal assistance. GI BILL OF RIGHTS HOME FINANCING 1. S. 866 (title I) provides for an incontestability clause on GI guaranteed loans, so as to encourage participation by financing institutions in the GI bill of rights home loan program. 2. S. 866 (title II) provides for a secondary market for GI loans, which should help considerably in encouraging active participation by home financing institutions on the best possible terms to the veteran in the GI bill of rights home loan guarantee program, particularly in those areas where such financing has been difficult to obtain by veterans. (At the same time, the provisions of S. 866 are designed to prevent such a secondary market program from being inflationary in effect from the point of view of the veteran.) 3. Because of recent developments in the mortgage financing market, S. 866 (title I) contains a provision authorizing the Veterans' Administrator to increase by 2 of 1 percent the maximum interest rate on GI home loans, if the mortgage market demands it and the Secretary of the Treasury approves. This authorization provides assurance that the GI home loan guarantee program will be able to continue operating even in the face of adverse developments in the money market. At the same time, it is designed to be exercised only if absolutely required in order to enable veterans to obtain home loans. (Similar to provision for Federal Housing dministration title VI loans in S. 866.) FARM HOUSING In its provisions for a farm housing program, S. 866 (title VII) provides that preference shall be given to veterans. PARAPLEGICS S. 866 (title VII) provides for a program of special subsidy aids to paraplegic veterans so that they may be able to obtain the special type housing needed because of their disability. The CHAIRMAN. Mr. Roosevelt, on page 5, in the next to the last paragraph, you say "Veterans are particularly interested in the assistance which is provided to nonprofit housing cooperatives comprised primarily of veterans." Do you have particularly in mind there the Veterans' Homestead Act, H. R. 4488? Mr. ROOSEVELT. No, sir; I think that is The CHAIRMAN. Or the provisions of this bill? Mr. ROOSEVELT. Yes, sir; I am referring not to the Homestead Act but to the provisions of S. 866. The CHAIRMAN. Has the American Veterans Committee taken any position on the H. R. 4488? Mr. ROOSEVELT. On the Homestead provisions, the Legion bill? The CHAIRMAN. Yes. Mr. ROOSEVELT. We have taken no position, except that we do feel that it is not a comprehensive program, and I might point out here that the slogan of the American Veterans Committee is "Citizens First and Veterans Second," and our position has been, all along, that we are not after special group legislation, special interests legislation. That is the real reason why we have been for S. 866 so wholeheartedly, because it attacks the problem on a national basis, rather than just from the veterans' standpoint. The CHAIRMAN. When the American Legion was before the committee yesterday, they recommended that that bill, H. R. 4488, the Homestead Act, which has already been reported out of the House Veterans Affairs Committee, be appended to this bill as an amendment. Do you care to comment upon the possible effect of that with respect to this bill? Mr. ROOSEVELT. Now, as I understand it-I have not read the Legion bill. As I understand it, it really forms an association of five or more veterans and gives them certain loan guarantees from the Federal Government to carry out their association construction. The American Veterans Committee would have no objection to that being an amendment to S. 866, provided none of the present provisions of S. 866 were deleted as a result of that amendment. The CHAIRMAN. Perhaps you might want to qualify that statement. I think you should have in mind, in making that statement, that the bill, H. R. 4488, contemplates a potential obligation on the part of the Federal Government of something over $9,000,000,000, which, added to the potential liabilities, contingent and actual, in S. 866, would bring the bill up to well over a $20,000,000,000 bill, which frightens us somewhat. In view of that, do you think you are in a position to make any recommendation with respect to whether we should tack H. R. 4488 onto this bill? That is what I had in mind when I asked what the possible effects of doing so might be. Mr. ROOSEVELT. I understand. My immediate reaction would be that if S. 866 is passed, as it is presently passed by the Senate, if it were so passed by the House, that the Legion bill would be, in effect, superfluous, because the needs of the veteran would be largely taken care of through the Taft-Ellender-Wagner bill. I would, frankly, have to study the Legion bill considerably in more detail than I have to date before I could give you a specific answer, however, as to whether I personally am in favor of every one of its provisions. The CHAIRMAN. Then, it would suffice to say for the record Mr. ROOSEVELT. I think the Legion has to defend its own bill, and I do not want to get in the position of either attacking the Legion or favoring this particular legislation, because I am not qualified to discuss it. The CHAIRMAN. We can dispose of it summarily by saying that the American Veterans Committee has taken no position on that bill. Mr. ROOSEVELT. That is correct. The CHAIRMAN. Do you wish to comment upon the paraplegic provisions of S. 866? That is title VIII. I think we are sympathetic to it. It provides that where veterans are victims of spinal cord injury or disease to the extent of crippling their lower extremities, special provisions should be made. Mr. ROOSEVELT. Yes, sir; that is title VIII. We are in favor of that. In fact, we have already, in previous legislation, led the fight for the automobile legislation which was passed a year ago. We have felt right long that they should get special care and special provisions. The CHAIRMAN. Many of us have been giving consideration to that, and in view of our experience under the automobile legislation to which you referred, I have this in mind: what is the fundamental difference between a veteran who has paralysis of his lower extremities due to a spinal injury or disease, from a veteran with other injuries, let us say, an injury to the groin, or the upper part of the legs, so that he is paralyzed, or a veteran who has had both legs amputated up so far that he cannot be rehabilitated through the use of artificial limbs? I think this committee will have to give consideration to the fact that if we adopt that provision, we will introduce a discrimination against those categories of veterans. Mr. ROOSEVELT. Mr. Chairman, as I remember it, title VIII refers to service-connected disabilities, among which are the paraplegics. The CHAIRMAN. It is confined specifically to the paraplegics; that is my point; namely, veterans who have had their lower extremities paralyzed through an injury or disease of the spinal column. My point is if that paralysis results from any other injury than injury to the spinal column, surely, they should be entitled to the same consideration or benefits. Mr. ROOSEVELT. I agree with you completely on that. It is a question of really defining the injury in sufficiently accurate terms. I think that is the only problem there. The CHAIRMAN. Has your committee made any study with respect to the number of veterans who would be affected? Mr. ROOSEVELT. Not to my knowledge, Mr. Chairman. We do not have the figures on the number of veterans who would be affected by the broadening of that provision, but I am sure the Veterans' Administration could supply those figures. The CHAIRMAN. They could not. That is why I asked. Mr. ROOSEVELT. I am surprised at that. The CHAIRMAN. On page 4 of your statement, in the next-to-last paragraph, you make the statement: The major provisions of S. 866 deal with financial aids and guaranties to expand rental and sales housing construction. With the exception of the bill which we passed in the House, I believe on March 23, having to do with title VI insurance, and expanding that provision somewhat, what do you have in mind when you make that statement? I say, in addition to title VI financing-I am speaking now of title VI of the National Housing Act, wherein the Government insures 90 percent of the mortgage. And under the |