[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]



 
                        THE TRUE COST OF THE WAR

=======================================================================


                                HEARING

                               before the

                     COMMITTEE ON VETERANS' AFFAIRS
                     U.S. HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                           SEPTEMBER 30, 2010

                               __________

                           Serial No. 111-103

                               __________

       Printed for the use of the Committee on Veterans' Affairs





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                    `COMMITTEE ON VETERANS' AFFAIRS

                    BOB FILNER, California, Chairman

CORRINE BROWN, Florida               STEVE BUYER, Indiana, Ranking
VIC SNYDER, Arkansas                 CLIFF STEARNS, Florida
MICHAEL H. MICHAUD, Maine            JERRY MORAN, Kansas
STEPHANIE HERSETH SANDLIN, South     HENRY E. BROWN, Jr., South 
Dakota                               Carolina
HARRY E. MITCHELL, Arizona           JEFF MILLER, Florida
JOHN J. HALL, New York               JOHN BOOZMAN, Arkansas
DEBORAH L. HALVORSON, Illinois       BRIAN P. BILBRAY, California
THOMAS S.P. PERRIELLO, Virginia      DOUG LAMBORN, Colorado
HARRY TEAGUE, New Mexico             GUS M. BILIRAKIS, Florida
CIRO D. RODRIGUEZ, Texas             VERN BUCHANAN, Florida
JOE DONNELLY, Indiana                DAVID P. ROE, Tennessee
JERRY McNERNEY, California
ZACHARY T. SPACE, Ohio
TIMOTHY J. WALZ, Minnesota
JOHN H. ADLER, New Jersey
ANN KIRKPATRICK, Arizona
GLENN C. NYE, Virginia

                   Malcom A. Shorter, Staff Director

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public 
hearing records of the Committee on Veterans' Affairs are also 
published in electronic form. The printed hearing record remains the 
official version. Because electronic submissions are used to prepare 
both printed and electronic versions of the hearing record, the process 
of converting between various electronic formats may introduce 
unintentional errors or omissions. Such occurrences are inherent in the 
current publication process and should diminish as the process is 
further refined.


                            C O N T E N T S

                               __________

                           September 30, 2010

                                                                   Page
The True Cost of the War.........................................     1

                           OPENING STATEMENTS

Chairman Bob Filner..............................................     1
    Prepared statement of Chairman Filner........................    39
Hon. Ciro D. Rodriguez...........................................     4

                               WITNESSES

Batiste, Major General John, USA (Ret.), Rochester, NY...........    20
    Prepared statement of General Batiste........................    53
Bilmes, Linda J., Daniel Patrick Moynihan Senior Lecturer in 
  Public Policy, John F. Kennedy School of Government, Harvard 
  University, Cambridge, MA......................................     8
    Prepared joint statement of Ms. Bilmes and Dr. Stiglitz......    40
Disabled American Veterans, Joseph A. Violante, National 
  Legislative Director...........................................    12
    Prepared statement of Mr. Violante...........................    50
Gibson, Corey, Terre Haute, IN...................................    34
    Prepared statement of Mr. Gibson.............................    68
Knight-Major, Lorrie, Silver Spring, MD..........................    32
    Prepared statement of Ms. Knight-Major.......................    64
Nash, Major General William L., USA (Ret.), Washington, DC.......    25
    Prepared statement of General Nash...........................    57
Stiglitz, Joseph E., Ph.D., University Professor, Columbia 
  University, New York, NY.......................................     5
    Prepared joint statement of Dr. Stiglitz and Ms. Bilmes......    40
Van Derveer, Lieutenant Colonel Donna R., USA (Ret.), Ashville, 
  AL.............................................................    37
    Prepared statement of Colonel Van Derveer....................    70
Veterans for Common Sense, Paul Sullivan, Executive Director.....    29
    Prepared statement of Mr. Sullivan...........................    58
Veterans' Outreach Center of Rochester, NY, Colonel James D. 
  McDonough, Jr., USA (Ret.), President and Chief Executive 
  Officer........................................................    22
    Prepared statement of Colonel McDonough......................    54

                       SUBMISSION FOR THE RECORD

Swords to Plowshares, statement..................................    70


                        THE TRUE COST OF THE WAR

                              ----------                              


                      THURSDAY, SEPTEMBER 30, 2010

                     U.S. House of Representatives,
                            Committee on Veterans' Affairs,
                                                    Washington, DC.

    The Committee met, pursuant to notice, at 10:00 a.m., in 
Room 334, Cannon House Office Building, Hon. Bob Filner 
[Chairman of the Committee] presiding.
    Present: Representatives Filner, Mitchell, Teague, 
Rodriguez, McNerney, and Space.
    Also Present: Representatives George Miller of California, 
Jones, and Moran of Virginia.

              OPENING STATEMENT OF CHAIRMAN FILNER

    The Chairman. Good morning. Welcome to this hearing of the 
House Veterans' Affairs Committee.
    Let the record show that Members in attendance besides the 
Chair are Mr. Mitchell of Arizona; Mr. Teague of New Mexico; 
Mr. Rodriguez of Texas; and Mr. McNerney of California.
    And I would ask unanimous consent that our colleague, the 
gentleman from North Carolina, Mr. Jones, be allowed to sit at 
the dais and participate as a Member of the Committee for this 
hearing.
    Hearing no objection, Mr. Jones, thank you for joining us. 
We know of your great interest and leadership on the issues we 
are discussing. Thank you again for being here today.
    We have titled the hearing ``The True Cost of the War.'' It 
struck me, as I looked at a lot of the facts and data that we 
see across our desk, that, as a Congress and as a Nation, we 
really do not know the true cost of the wars we are fighting in 
Iraq and Afghanistan.
    I also want the record show that Mr. Space from Ohio is 
here.
    I ask unanimous consent that Mr. Moran from Virginia be 
allowed to sit at the dais and participate as a Member of the 
Committee for today. Hearing no objection, so ordered.
    Thank you very much, Mr. Moran, for your leadership and 
interest on these issues.
    We all look at the data that comes from these wars. It 
struck me one day that the official data for the wounded is 
around 45,000 for both wars; and, yet, we know that 600,000 or 
700,000 of our veterans of these wars, of which there are over 
a million already, have either filed claims for disability or 
sought health care from the U.S. Department of Veterans Affairs 
(VA) for injuries suffered at war--45,000 versus 800,000. This 
is not a rounding error. I think this is a deliberate attempt 
to mask what is going on, in terms of the actual casualty 
figures.
    We know there is denial of post-traumatic stress disorder 
(PTSD). It is considered a weakness among Marines and soldiers 
to admit mental illness, so we don't even have those figures 
until it is possibly too late.
    We all know that women are participating in this war in a 
degree never before seen in our Nation's history, and yet, an 
estimated half or two-thirds have suffered sexual trauma. The 
true cost of war.
    We know that over 25,000 of our soldiers who were 
originally diagnosed with PTSD got their diagnosis changed--or 
their diagnosis was changed as they had to leave the Armed 
Forces, changed to personality disorder. Now, not only does 
that diagnosis beg the question of why we took people in with a 
personality disorder, it means that there is a preexisting 
condition and we don't have to take care of them as a Nation. 
It is the cost of war.
    There have been months in this war where the suicides of 
active-duty members have exceeded the deaths in action. Why is 
that? When our veterans come home from this war, we say we 
support troops, we support troops, we support troops, but there 
is a 30-percent unemployment rate for returning Iraq and 
Afghanistan veterans. That is three times an already-horrendous 
rate in our Nation. Guardsmen find difficulty getting 
employment because they may be deployed.
    Now, a democracy has to go to war sometimes, but people 
have to know what is the cost? They have to be informed of the 
true nature not only in terms of the human cost and the 
material cost but hidden costs that we don't know until after 
the fact, or don't recognize.
    Why is it that we don't have the mental health care 
resources for those coming back? Is it because we failed to 
understand that the cost of serving our military veterans is a 
fundamental cost of the war? Is it because we sent these men 
and women into harm's way without accounting for and providing 
the resources necessary for their care if they are injured, 
wounded, or killed?
    Every vote that Congress has taken for the wars in Iraq and 
Afghanistan has failed to take into account the actual cost of 
these wars by ignoring what will be required to meet the needs 
of our men and women in uniform who have been sent into harm's 
way. This failure means that soldiers who are sent to war on 
behalf of their Nation do not know if their Nation will be 
there for them tomorrow.
    The Congress that sends them into harm's way assumes no 
responsibility for the long-term consequences of their 
deployment. Each war authorization and appropriation kicks the 
proverbial can down the road. Whether or not the needs of our 
soldiers injured or wounded in Iraq and Afghanistan will be met 
is totally dependent on the budget priorities of a future 
Congress, which includes two sets of rules: one for going to 
war and one for providing for our veterans who fight in that 
war. We don't have a budget for the VA today, as we are about 
to enter the new fiscal year.
    We are trying to provide for those involved in atomic 
testing in World War II, even after we were told there would be 
no problems, and yet they can't get compensation for their 
cancer. This Committee and this Congress has a majority of 
people who believe that we should fully compensate the victims 
of Agent Orange for injuries in Vietnam. Yet we have a PAYGO 
rule on bills coming out of this Committee. They say it is 
going to cost roughly $10 billion or $20 billion over the next 
10 years but we don't have it--why don't we have it? They 
fought for this Nation. We are still trying to deal with 
Persian Gulf War illness, not to mention all the casualties 
from this war.
    We have to find a PAYGO offset, but the U.S. Department of 
Defense (DoD) doesn't have to. The system that we have for 
appropriating funds in Congress is designed to make it much 
easier to vote to send our soldiers into harm's way than it is 
to care for them when they come home.
    This Committee and every one of the people here has fought 
tooth and nail to get enough money for our veterans. We have to 
fight for it every day. We have been successful in the last few 
years, but we won't if that rate of growth continues.
    This is morally wrong, in my opinion, and an abdication of 
our fundamental responsibility as Members of Congress. It is 
past time for Congress to recognize that standing by our men 
and women in uniform and meeting their needs is a fundamental 
cost of war. We should account for those needs and take 
responsibility for meeting them at the same time we send these 
young people into combat.
    Every Congressional appropriation for war, in my view, 
should include money for what I am going to call a Veterans 
Trust Fund. The Fund will assure the projected needs of our 
wounded and injured soldiers are fully met at the time they're 
going to war.
    It is not a radical idea. Businesses are required to 
account for their deferred liability every year. Our Federal 
Government has no such requirement when it comes to the 
deferred liability of meeting the needs of our men and women in 
uniform, even though meeting those needs is a moral obligation 
of our Nation and a fundamental cost. It does not make sense 
fiscally; it does not make sense ethically.
    If, in years past, Congress had taken into account this 
deferred fiscal liability and moral obligation of meeting the 
needs of soldiers, we would not have the kind of overburdened 
delivery system that we have today in the Department of 
Veterans Affairs. Would veterans and their advocates on Capitol 
Hill have to fight as hard as they do every year for benefits 
that should be readily available as a matter of course? Would 
they have to worry as much as they do today that these benefits 
will become targets in the debate over reducing the Federal 
budget?
    Listen to this statement by the Co-chair of the National 
Commission on Fiscal Responsibility that is trying to figure 
out how we balance our budget. Former Senator Simpson said, 
``The irony is that veterans who saved this country are now, in 
a way, not helping us to save the country in this fiscal 
mess.'' That is, they should defer their health and welfare 
needs because of a budget problem.
    So we are going to examine this. I thank the gentlemen who 
are here today. The Congress did adjourn early this morning, 
and it is good to have you all here on this important issue.
    [The prepared statement of Chairman Filner appears on p. 
39.]
    The Chairman. Would anybody like to make opening remarks?
    Mr. Rodriguez.

          OPENING STATEMENT OF HON. CIRO D. RODRIGUEZ

    Mr. Rodriguez. Yes, Mr. Chairman, let me first thank you 
for allowing us to be here. As you indicated, we have 
adjourned, and I first have a flight I am going to be taking, 
but I do want to thank you for focusing our attention on this 
major issue.
    I also want to mention that this might be probably the last 
time we meet this year, and I want to just thank you for your 
leadership in the last 4 years in making a huge difference to 
our veterans. Having served on this Committee probably, of the 
ones that are here today, the longest, next to you--I know that 
we have had some frustrating situations, and the last 4 years 
has been very rewarding to at least make some inroads into some 
of the problems. And I am hoping that, as we move forward, that 
you will continue to bring up the importance of reaching out to 
these veterans.
    I know that one issue that I just want to again mention is 
the one where we dealt with Project 112, which was the studies 
that were done in the 1960s and 1970s, and where at first, the 
Department of Defense denied having even done the studies. 
Later on, we found that there was about 20-something studies, 
and then there was 30-something. I guess the last figure was 
about 50-something studies in the 1960s and 1970s where we used 
nerve gas and used specially other things on our own soldiers 
and then actually experimented with them, a lot of the Marines 
and people in the Navy. And still we haven't done the right 
thing with a huge number of them.
    And so I am hoping that, as we move forward, we do the 
right thing for those veterans who suffered. Our veterans were 
there for us, and we need to be there for them now as they 
reach their twilight years.
    Thank you very much for your leadership in this area.
    The Chairman. Thank you, Mr. Rodriguez.
    Mr. Jones or Mr. Moran, any opening remarks?
    Mr. Jones. No, thank you, Mr. Chairman. I am just anxious 
to hear from the witnesses----
    The Chairman. Great. We are going to hear from them after I 
give another hour of opening remarks.
    We are going examine these questions today. We are pleased 
and honored to have with us Nobel Laureate Joseph Stiglitz of 
Columbia University, Linda Bilmes of Harvard, the authors of 
``The Three Trillion Dollar War,'' which was a groundbreaking 
book that brought a healthy but sobering dose of reality into 
our public debates about the wars in Iraq and Afghanistan and 
the long-term consequences of those decisions.
    We are also, in the following panels, going to have 
distinguished military leaders, veterans of the wars in Iraq 
and Afghanistan, veterans advocates, and families of veterans 
to help us put into focus this question of how we deal with our 
veterans who have served us.
    It is time for open and honest discussion about the moral 
obligations for our Nation. It is time to reflect on the need 
to reform a process that systematically denies the connection 
between fighting a war and meeting the needs of those we send 
into harm's way. Our veterans deserve better.
    Professor Bilmes joins us from Harvard University. Dr. 
Stiglitz joins us from Columbia University, and Dr. Joe 
Violante--I have just given you an honorary doctorate--is here 
representing the Disabled American Veterans (DAV).
    Thank you for being here today.
    Dr. Stiglitz, are you first up? We will include all of your 
written statements in the record.
    I don't know who is first, Dr. Stiglitz or Ms. Bilmes? 
Okay, Dr. Stiglitz, proceed please.

STATEMENTS OF JOSEPH E. STIGLITZ, PH.D., UNIVERSITY PROFESSOR, 
 COLUMBIA UNIVERSITY, NEW YORK, NY (NOBEL LAUREATE); LINDA J. 
   BILMES, DANIEL PATRICK MOYNIHAN SENIOR LECTURER IN PUBLIC 
     POLICY, JOHN F. KENNEDY SCHOOL OF GOVERNMENT, HARVARD 
  UNIVERSITY, CAMBRIDGE, MA; AND JOSEPH A. VIOLANTE, NATIONAL 
        LEGISLATIVE DIRECTOR, DISABLED AMERICAN VETERANS

             STATEMENT OF JOSEPH E. STIGLITZ, PH.D.

    Dr. Stiglitz. Well, thank you very much, Chairman Filner, 
Members of the House Veterans' Affairs Committee. Thank you for 
convening this hearing today and for inviting us to testify on 
the true cost of the war.
    Congressman Filner outlined some of the costs of war, the 
human costs, that go beyond the budgetary costs that so much of 
the attention has been focused on. I want to thank you for your 
commitment to deal with these problems.
    There is no such thing as a war for free. The repercussions 
of war and the costs of war persist for decades after the last 
shot is fired. As Congressman Filner mentioned, the inevitable 
costs, the economic consequences, and the long-term welfare of 
the troops are seldom mentioned at the start of a conflict.
    The budgetary problems facing the United States today 
remind us that even the richest country in the world faces 
constraints and must make choices. Limitations of resources, 
both budgetary and military, have to be confronted. But we can 
only make intelligent choices if we have the relevant 
information. Analysis of costs and benefits provide some of the 
critical pieces of information.
    Today, we have a better view of both the benefits and the 
costs of war than we did at the outset. The benefits of the war 
center on the value of additional security obtained by the war. 
This is a subject on which reasonable people may disagree. It 
requires assumptions typically unverifiable about what would 
have happened in the absence of the conflict.
    Estimating the cost of the war is more straightforward. 
There is no doubt that wars use up resources. The question is 
how to estimate the full magnitude of the resources used and 
assign values to them. Any estimates have to be comprehensive, 
not only the direct budgetary cost today but the long-term 
budgetary cost, some of which are felt outside of the 
Department of Defense, as well as the overall cost to our 
economy and our society.
    Looking at the long-run cost for war is especially 
important because the cost lasts so long. For instance, 
disability claims for World War I veterans did not peak until 
1969.
    It is obvious now that the wars in Iraq and Afghanistan 
have been far more costly, both in terms of blood and treasure, 
than its advocates suggested at the outset. The absence of 
reliable estimates meant there was no opportunity for a 
meaningful debate before we embarked on this war of choice.
    Two years ago, we published ``The Three Trillion Dollar 
War: The True Cost of the Iraq Conflict,'' in which we 
estimated that the total cost to the U.S. through 2017, 
including lifetime health care and disability costs for 
returning troops, as well as the economic impacts to the 
country, would be $3 trillion. This price tag dwarfed previous 
estimates, but subsequent investigations by both the 
Congressional Budget Office (CBO) and the Joint Economic 
Committee of Congress found our estimate to be broadly correct.
    This morning we will focus on three issues. First, we will 
discuss some of the costs that the war has imposed on the U.S. 
economy.
    Second, we will provide an updated estimate for the single-
biggest long-term budgetary cost of the current war, which is 
the cost of providing medical care, disability compensation, 
and other benefits to veterans of the Iraq and Afghanistan 
conflicts.
    Thirdly, we will argue that such costs are inevitable and 
can be estimated, to some extent, in advance. This means the 
U.S. should be making provisions for its war veterans at the 
time we appropriate money for going to war. We will recommend 
steps that can be taken to address this unfunded financial 
liability.
    Before turning to the cost to the U.S. economy, let me make 
a few introductory comments about the difficulties of 
estimation. What makes this analysis challenging is that 
government accounting systems do not document most items in a 
way that would enable an easy assessment of the resources 
directly used or the full budgetary impact. Congressman Filner 
has pointed out the discrepancies between the 45,000 casualties 
and the number of individuals making use of our VA medical 
facilities and claiming disabilities.
    The way we account for our troops is an essential example 
of the way economic costs typically exceed budgetary costs. For 
example, from the sole perspective of military accounting, the 
cost of a soldier's life is valued at $500,000. This doesn't 
include the cost to the military of recruiting and training a 
replacement troop and the impact on morale and mental health of 
the rest of the unit. It also does not reflect the economic 
loss of a young man or woman. By contrast, when civilian 
agencies, such as the Environmental Protection Agency and the 
Food and Drug Administration, are evaluating proposed 
regulation, when they compare the cost of imposing a regulation 
to the potential life saved, they estimate the value of a life 
between $6 million and $8 million.
    In addition to the known cost of conducting current and 
future military operations and caring for war veterans, which 
Linda will discuss later, the most sobering costs of the 
conflict are in the category of ``might have beens,'' what 
economists call opportunity costs.
    Specifically, in the absence of the Iraq invasion, would we 
still be mired in Afghanistan? Would oil prices have risen so 
rapidly? Would the Federal debt be so high? Would the economic 
crisis have been so severe? Arguably, the answer to all four of 
these questions is ``no.''
    Between 2003 and 2006, we have spent five times as much 
money in Iraq as in Afghanistan. The Iraq invasion diverted our 
attention from Afghanistan, a war that is now entering its 10th 
year and which threatens to destabilize nuclear-armed Pakistan. 
While success in Afghanistan might always have been elusive, we 
would probably have asserted control over the Taliban and 
suffered less expense and loss of life if we had maintained our 
initial momentum and not been sidetracked in Iraq.
    The second cost is the higher price of oil, which has had a 
devastating effect on our economy. When we went to war in Iraq, 
the price of oil was under $25 a barrel, and future markets 
expected it to remain around that level. With the war, prices 
started to soar, by 2008 reaching $140 a barrel.
    In our conservative $3 trillion estimate, we attribute only 
$5 to $10 of the per-barrel-price increase to the war. However, 
we now believe that a more realistic estimate of the impact of 
the war on the oil price over a decade is at least $10 to $15 
per barrel. That translates into at least an additional $250 
billion increase in the cost of war above the numbers in our 
book.
    Thirdly, the war added substantially to the Federal debt. 
It is the first time in America's history where a government 
cut taxes as it went to war, even in the face of continued 
government deficits. When the crisis began, the global 
financial crisis, the debt reduced our room to maneuver. It 
does so even more today, with the results of a deeper and 
longer recession.
    But the link between the war and the crisis is even 
stronger than that. The crisis itself was, in part, due to the 
war. The increase in oil prices reduced domestic aggregate 
demand. Money spent buying oil abroad was money not available 
for spending at home, for instance. Loose monetary policy and 
lax regulations kept the economy going through a housing 
bubble, whose breaking brought on the global financial crisis.
    Counterfactuals, what might have happened if we had not 
gone to war, are always difficult, and especially so with 
complex phenomena like a global financial crisis with so many 
contributing factors. What we do know is that one of the true 
costs of the war is its contribution to a worse economic 
recession, higher unemployment, and larger deficits than might 
have otherwise occurred.
    Let me conclude with a few general observations. The large 
disparity between budgetary and the full economic cost of war 
means that there is a need for a comprehensive reckoning to the 
cost of the economy as a whole. The fact that we have been able 
to construct estimates underlines the fact that this exercise 
can be done once there is a will to do it.
    Without good information, there cannot be good decisions 
about going to war, about exiting the war, and about the 
conduct of the war. But even more is at stake, as we face 
intense budgetary pressures in coming years. We have an 
implicit contract with our veterans, who have served their 
country so well.
    But the way the political and budgetary process is 
conducted today fails to recognize this. Veterans expenditures 
are subject to the same PAYGO rules as any other expenditure. 
This puts our commitments to veterans in jeopardy. This is even 
more important as these costs soar in response to this war.
    Professor Bilmes will discuss these costs and the reforms 
that are necessary to ensure that we fulfill our commitments.
    Thank you.
    The Chairman. Thank you.
    Ms. Bilmes.

                  STATEMENT OF LINDA J. BILMES

    Ms. Bilmes. Chairman Filner, Members of the Committee, 
thank you for inviting us to testify today.
    My father was a World War II veteran who served in the Army 
and earned his college and graduate degrees under the GI Bill. 
I am grateful to our country for honoring its commitment to 
him.
    I would like to discuss two issues in my statement. First, 
I will explain our revised cost estimates for veterans' medical 
care and disability benefits. Second, I will recommend that we 
develop a financial strategy for meeting this obligation.
    The largest long-term budgetary cost of the wars is 
providing medical care and disability benefits to veterans who 
have served in Iraq and Afghanistan. As of this month, 5,700 
U.S. servicemen and women have died, and over 90,000 have been 
wounded in action or injured seriously enough to require 
medical evacuation. A much larger number, over 565,000, have 
already been treated in VA medical facilities.
    The evidence from previous wars shows that the cost of 
caring for war veterans peaks in 30 to 40 years or more after a 
conflict. The costs rise over time as veterans get older and 
their medical needs grow.
    Two and a half years ago, we estimated the likely cost of 
providing medical care and disability benefits to Iraq and 
Afghanistan veterans based on historical patterns. We now have 
the actual record of 400,000 recent veterans, and we have 
revised our estimates based on this new information.
    The most striking finding is that veterans from the recent 
wars are utilizing VA medical services and applying for 
disability benefits at much higher rates than in previous wars. 
The higher medical usage is the result of several factors, 
including higher survival rates for seriously wounded troops, 
higher incidence of post-traumatic stress disorder and other 
mental health problems, more veterans who are willing to seek 
treatment for mental health ailments, more generous medical 
benefits, more presumptive conditions, and higher benefits in 
some categories.
    The high incidence of PTSD means that the medical cost of 
current conflicts will continue to rise at a rapid rate for 
many decades. This was the experience with Vietnam veterans 
diagnosed with PTSD.
    And recent studies have documented that PTSD sufferers are 
at a higher risk for heart disease, rheumatoid arthritis, 
bronchitis, asthma, liver, and peripheral arterial disease. 
PTSD sufferers are 200 percent more likely to be diagnosed with 
a disease within 5 years of returning from deployment. Veterans 
with PTSD utilized non-mental health care services, such as 
primary care, ancillary services, diagnostic tests and 
procedures, emergency services, and hospitalizations, 71 to 170 
percent higher than those without PTSD.
    Research has also shown that traumatic brain injury, which 
is estimated to affect some 20 percent of Iraq and Afghanistan 
veterans, often in conjunction with PTSD, places sufferers at 
higher risk for lifelong medical problems such as seizures, 
decline in neurocognitive functioning, dementia, and chronic 
diseases.
    The high number of claims among recent veterans is due both 
to the health problems I described and also to better outreach 
and capacity at the VA and greater availability of information 
on the Internet and greater outreach by veterans service 
organizations.
    Since our book was written, a number of recommendations 
that we and others urged have been adopted, including that VA 
has expanded the Benefits Delivery at Discharge Program and 
Quick Start; increased the number of conditions that are 
presumptive in favor of the veteran; liberalized the PTSD 
``stressor'' definition and increased some categories of 
benefits; provided 5 years of free health care instead of 2; 
and is in the process of restoring medical care to 500,000 
moderate-income Priority 8 veterans.
    VA has also hired more medical and claims personnel and 
invested heavily in information technology (IT) upgrades to the 
claims process. All of these factors contribute to the rising 
cost estimates I will describe.
    Our model for projecting long-term budgetary cost is based 
entirely on government data. We based our projections for troop 
levels on estimates by the Congressional Budget Office and the 
Congressional Research Service. And we used rates of average 
disability compensation, Social Security Disability benefits, 
and medical costs on information from the Veterans Benefits 
Administration (VBA), the Veterans Health Administration, 
Social Security Administration, and government economic 
indicators.
    The projections cover the period for the 1.25 million 
servicemembers who have been discharged from Iraq and 
Afghanistan and become veterans from 2001 to the present, as 
well as estimates for military members who will become veterans 
by 2020.
    In our earlier work, we estimated that the long-term cost 
of providing medical care and disability compensation for these 
veterans would be between $400 billion and $700 billion, 
depending on the length of and intensity of the conflict and 
future deployment levels. We now expect the cost range to be 
between $589 billion and $934 billion, depending on these 
factors. I believe there is a chart, which has been posted 
here, which shows our earlier estimates as well as our current 
estimates.
    About three-quarters of this increase is due to higher 
claims activity and higher medical utilization of Iraq and 
Afghanistan veterans. And about 18 percent is due to the higher 
number of troops deployed. Six percent is due to the difference 
in projecting through 2020 instead of 2017.
    In terms of disability cost projections, in 2008, we had 
projected that between 366,000 and 398,000 returning Iraq and 
Afghanistan veterans would have filed disability claims by this 
point, by 2010. In fact, more than 513,000 veterans have 
already applied for VA disability compensation. We now estimate 
that the present value of these claims over the next 40 years 
will be from $355 billion to $534 billion.
    In addition, veterans who can no longer work may apply for 
Social Security Disability benefits. We estimate that the 
present value of lifetime Social Security Disability benefits 
for these veterans will range from $33 billion to $52 billion.
    In terms of medical cost projections, in our earlier 
analysis, we had anticipated that 30 to 33 percent of returning 
veterans, which would be fewer than 400,000, would have been 
treated in the VA medical system by 2010. The actual number is 
running at more than 565,000 veterans, that number is from 
April, so it is probably approaching 600,000 veterans now, 
which is about 45 percent of discharged troops. In our earlier 
work, we had projected that the VA would not reach this level 
until 2016.
    We now estimate that the present value of medical care 
provided by the VA to veterans from Iraq and Afghanistan over 
the next 40 years will be between $201 billion and $348 
billion, depending on the duration and intensity of military 
operations.
    These estimates do not include a range of additional costs 
that will be paid by departments across government, including 
veterans' home loan guarantees, veterans' job training, 
concurrent receipt of pensions, higher costs to Medicare and 
TRICARE for Life by veterans who are not enrolled in the VA 
system, costs to State and local governments, or the GI Bill, 
which is an investment that will yield significant economic 
benefits but will also add budgetary costs.
    Taking these costs into account, the total budgetary costs 
associated with providing for America's war veterans from Iraq 
and Afghanistan approaches $1 trillion.
    I also want to emphasize that the true cost goes beyond the 
budgetary costs. There are much larger social and economic 
burdens that are not paid by the Federal Government but 
nonetheless represent a real burden on society. These include 
the loss of productive capacity by young Americans who are 
killed or seriously wounded; lost output due to mental illness; 
the burden on caregivers who have to sacrifice paid employment 
in order to take care of a veteran; the cost of those, 
particularly among Reservists and Guards, who were self-
employed and have lost their livelihood. For many veterans, 
there is simply a diminished quality of life, the costs of 
which is borne by individuals and families.
    Women troops have been especially hard-hit. They make up 11 
percent of the force. Divorce rates are three times higher for 
female than for male troops. And more than 30,000 single 
mothers have deployed to the war zone.
    The military has also employed several hundred thousand 
contractors, who have become indispensable to the war effort. 
These contractors have also suffered from high rates of 
casualties, injuries, and mental health problems. These impose 
both budgetary costs--through government subsidies to worker 
compensation and insurance companies--and social costs in all 
of the areas mentioned for troops.
    In our book, we attempted to quantify the monetary value of 
some of these costs, although some cannot be quantified. At 
that time, we estimated that these social costs would reach 
between $295 billion and $400 billion in excess of the 
budgetary costs. Given the high number of casualties and the 
high incidence of mental illness, we expect that this cost will 
be even higher.
    Let me now turn to the issue of financial liability. The 
scale of our financial commitment to providing for veterans is 
enormous, and we have estimated that the cost of Iraq and 
Afghanistan will add at least another half-trillion dollars 
onto that debt.
    But, at present, the U.S. has no financial strategy for how 
it will pay this growing liability. The financial statements of 
the United States on the statement of net cost shows that 
providing for veterans is the fourth-largest cost to the U.S. 
Treasury.
    In terms of accrued long-term liability, the balance sheet 
of the United States lists $1.3 trillion in veterans' 
compensation and burial benefits and a liability for $220 
billion in veterans' housing loan guarantees. Just to be clear, 
that is $1.3 trillion in deferred veterans' compensation. This 
does not take into account, however, the accrued liability for 
providing medical care or veterans' pensions. And we also 
believe it significantly understates the obligations for the 
current war.
    We now have no financial plan for meeting this obligation. 
There is no dedicated mechanism through which taxpayers who are 
not in military service contribute directly to caring for war 
veterans. Funding must come from general revenues, competing 
with a myriad of other demands.
    The consequence of ignoring this cost is threefold. First, 
it understates the true cost of going to war.
    Second, from an economic perspective, it is poor financial 
management. We should not be financing a 40-year-long pension 
and benefit obligation from annual budget revenues. We are 
essentially asking VA to fund mandatory benefits using 
discretionary appropriations.
    Third, it leads to the possibility that veterans' needs 
will not be funded. The VA has the responsibility to determine 
the availability of VA care based on appropriations levels. But 
even with the best will in the world and with a strong 
management team, this may result in insufficient funding. VA 
ran short of funds in 2005 and 2006. And, in January 2009, the 
U.S. Government Accountability Office found that VA's 
assumptions about its costs of long-term care were unreliable 
because they assumed cost increases were lower than VA's actual 
recent spending experience.
    VA is now facing the additional challenge of estimating 
demand for 2 years in advance appropriations. However, this is 
proving challenging because, using its current model, VA cannot 
determine precise operating needs 2\1/2\ years in advance, yet 
it is being asked by appropriators and by the Office of 
Management and Budget to do this.
    We recommend a different funding model that would include a 
mandatory component. I would personally--I have long advocated 
mandatory funding for VA medical care, particularly in light of 
the long-term infrastructure needs of the VA medical system.
    Another way to accomplish creating a mandatory component 
would be to establish a Veterans Trust Fund that would be 
funded as obligations occur. Although we cannot estimate 
precisely the magnitude of long-term demands, it should be 
possible to develop a framework for setting aside some funding 
at the time war money is appropriated.
    Secondly, in order to facilitate this, we need to improve 
the actuarial capacity of the VA. The Department should be 
directed to work with the Institute of Medicine to develop a 
better system of forecasting the amounts and types of resources 
needed to meet veterans' needs in 30 years or more, when their 
needs are likely to peak.
    I will stop here. And thank you, again, very much for 
bringing attention to this important issue.
    [The prepared joint statement of Dr. Stiglitz and Ms. 
Bilmes appears on p. 40.]
    The Chairman. Thank you, Professor Bilmes.
    Mr. Violante.

                STATEMENT OF JOSEPH A. VIOLANTE

    Mr. Violante. Mr. Chairman and Members of the Committee, 
thank you for inviting me to testify today on behalf of 
Disabled American Veterans. With 1.2 million Members, all of 
whom were disabled during wartime, no organization understands 
the true costs of wars better than the DAV.
    Mr. Chairman, war leaves a legacy of pain and hardship, 
borne by the men and women who suffer the wounds and bear the 
scars, as well as families who suffer the loss of a loved one 
and family members who care for disabled veterans. The true 
cost of war also includes the cost of peace, because all who 
defend our Nation have earned the rights to the benefits.
    In order to cover all these costs today and in the future, 
there are a number of actions that Congress can take.
    First, Congress must ensure that all benefits for disabled 
veterans are paid in full, not offset against other Federal 
benefits, eroded by inflation, nor whittled down by budget 
gimmicks such as rounding down our cost of living adjustments. 
And it is time to fully eliminate the prohibition on concurrent 
receipt of disability compensation and military retirement pay.
    Second, we must fully compensate disabled veterans for 
their sacrifice and loss, which must include compensation for 
noneconomic loss and loss of quality of life, not just loss of 
earning capacity. Both the Institute of Medicine and the 
Congressionally authorized Veterans' Disability Benefits 
Commission made this recommendation.
    Third, Congress must ensure that existing veterans' 
benefits are paid accurately and timely to effectively fulfill 
their intended purpose. Unfortunately, everybody today 
recognizes the VA benefits claims-processing system is broken. 
VA must focus on the goal of getting claims done right the 
first time and not just, quote, ``breaking the back of the 
backlog,'' end quote.
    Mr. Chairman, in November, VBA will roll out its new IT 
system as a pilot program. At the same time, they are 
continuing to experiment with more than 50 pilots across the 
country. It is imperative that Congress provide strong 
oversight and leadership to ensure that each pilot is judged 
first and foremost on its ability to help the VA get claims 
done right the first time.
    Fourth, we must fully support veterans' families and 
survivors. We are grateful that Congress approved the 
``Caregivers and Veterans Omnibus Health Service Act of 2010,'' 
but the law did not go far enough. Congress must extend these 
benefits to family caregivers of disabled vets from all 
conflicts and eras. Congress should also eliminate the offset 
for Survivor Benefit Plan and for those widows receiving 
Dependency and Indemnity Compensation (DIC).
    Fifth, we must ensure that veterans receive high-quality, 
comprehensive health care from a robust VA health care system. 
And that requires VA to have sufficient, timely, and 
predictable funding.
    While we remain grateful for the bipartisan support that 
made advanced appropriations a reality, we are concerned 
Congress and VA appear to be falling short of the promise of 
the law. With the new fiscal year beginning tomorrow and no 
Federal budget in sight, the fact that advanced appropriations 
for VA's fiscal year 2011 medical care budget is already in 
place demonstrates the importance and effectiveness of this new 
funding mechanism. However, Congress's failure to approve the 
regular fiscal year 2011 VA appropriations before adjournment 
also means that there is no fiscal year 2012 advanced 
appropriations approved for next year.
    Furthermore, in a July 30th report to Congress, Secretary 
Shinseki stated that the level of funding contained in VA's 
fiscal year 2011 advanced appropriations was no longer 
projected to be sufficient, yet he did not recommend any 
additional funding. Instead, he talked about reprogramming 
existing funding from lower-priority areas, which is contrary 
to the purpose of advanced appropriations.
    When VA reports funding requirements have changed due to 
unforeseen circumstances, the Secretary must request 
supplemental funding and Congress must provide such funding to 
fully meet their obligation.
    Finally, we must ensure that our Nation never backs away 
from its obligations to veterans because of our government's 
inability to keep its fiscal house in order. Any Nation that 
fails to meet its obligation to those who served, sacrificed, 
and suffered is a country already morally bankrupt. As such, 
any recommendations that seek to balance the budget on the 
backs of disabled veterans must be rejected.
    Mr. Chairman, the true cost of defending our Nation 
includes the full cost to compensate and care for all veterans 
as well as to support their family caregivers and survivors. 
Disabled American Veterans stands ready to work with this 
Committee and Congress to meet these sacred obligations to 
America's veterans, especially disabled veterans.
    That concludes my testimony, and I would be happy to answer 
any questions. Thank you.
    [The prepared statement of Mr. Violante appears on p. 50.]
    The Chairman. Thank you, Mr. Violante.
    Mr. Mitchell, do you have any questions?
    Mr. Jones, you are welcome to participate.
    Mr. Jones. Mr. Chairman, I will be brief.
    I want to thank the professor and the doctor for the book, 
``The Three Trillion Dollar War.'' I bought it 2 years ago.
    I have Camp Lejeune down in my district--60,000 retired 
veterans, and the numbers are growing. I want to thank the 
Chairman for not only this hearing but to bring to the 
attention of this Congress that we cannot continue to take care 
of our veterans with the same process. And you have said this, 
and you have made it very clear. If we don't look at 
alternatives, the DAV and all these other veterans service 
organizations are going to wonder, ``Why were we cheated out of 
our benefits?'' The shell game, Mr. Chairman, has to stop. That 
is why, again, this is so critical.
    And I hope that, after the elections, whatever happens in 
November, that this issue--and I am a Republican, and I am not 
on this Committee, but I want to make this pledge to you and to 
the veterans of this country. This needs to be one of the 
number-one priorities for the Congress to figure out what we 
are going to do, because the collapse is on the way. And I 
think that the Veterans Trust Fund is the way to start the 
debate as to what can we do to ensure that we keep our promise 
to those who have served this country and deserve every benefit 
that they have earned.
    And that is just a general statement. I don't really have a 
question, but I feel frustrated when I sit here. I have seen it 
for years. I have seen it for years. I see those kids at Walter 
Reed with their legs blown off. I see the moms crying, the 
wives crying. The kids are 19, 20, 21 years old. And, as you 
said, it is 30 years from now that we really have to be 
careful.
    But, Mr. Chairman, please know that you have my commitment 
to join in whatever effort we move forward on. Because we are 
not being honest; we are cheating the veterans if we don't do 
what is necessary today.
    I yield back.
    The Chairman. Again, I thank you for your leadership on the 
other side of the aisle.
    By the way, we can attribute Mr. Jones'--what shall I say--
more expansive understanding to the fact that his father was a 
Democratic Congressman. He doesn't like for us to know that, 
but thank you.
    Mr. Moran, again, thank you for your interest. Most people 
don't realize that when Members attend another Committee 
hearing, it is very unusual in this Congress, and very much 
appreciated.
    Mr. Moran of Virginia. Thank you, Chairman Filner. Thank 
you for your leadership.
    And I know that the folks in this audience know that 
Chairman Filner has taken on this responsibility not just as a 
professional duty but as a personal moral commitment.
    We have Mr. Miller entering the room, as well.
    And it is nice to see you, George.
    Speaking of Chairmen, Mr. Miller Chairs the Education and 
Labor Committee, which is very much involved in what we are 
talking about. That is one of the questions I want to ask.
    But the first one: Mr. Obey, myself, Mr. Murtha, I think 
Mr. Rangel, perhaps Chairman Filner, we voted for an amendment 
that went nowhere, but we did it for 2 or 3 years running--it 
was Mr. Obey's idea--to have a surcharge to pay for the war. If 
we were going to pursue the Iraq War, let's just figure out 
what the cost is and pay for it, rather than making that 
decision to go to war but passing on the cost to our children 
and grandchildren to pay for it.
    It went down. I think there were more than 400 people who 
voted against the concept. But it doesn't mean it wasn't a 
legitimate issue to raise, and I think it would have been the 
responsible thing to do.
    So my first question of two would be, would you have been 
able to estimate what that kind of surcharge would have been 
when we were actually making the decision? Is that consistent 
with the thrust of your testimony, that that is how we should 
go about making the decision whether or not to go to the war in 
the future.
    Professor Stiglitz.
    Dr. Stiglitz. Yes, I think it is an excellent idea for a 
number of reasons.
    First, I think it is very important to have transparency 
and accountability in government, that you ought to know what 
you are doing and what it costs, and citizens ought to know 
that, if you want to get something, you have to pay for it, you 
know, just like shopping, anything.
    Secondly, we can calculate it. That is the point that we 
have been making. You know, you can't estimate it perfectly, 
but you can't estimate Social Security perfectly. But you can 
get a fairly reliable estimate that would be the basis of a 
surcharge. And whether you express it as a percentage of the 
defense appropriations or as a tax, a separate tax, you know, 
you could express it in a number of different ways. It would be 
very easy, actually, to do that.
    And the third point is the point that Professor Bilmes made 
and the Congressman made, which is, by doing that, you would be 
setting aside money into a trust fund, and that is the only way 
that you can insulate this money against what I see as the 
increasing budget stringency that our country is going to be 
facing. And we should recognize that, for the next 20, 30 
years, we are going to be facing very difficult budgetary 
problems. I mean, they are not going to go away. And there is 
no easy way--I mean, I have some views about how you could do 
it, but there is no easy way out of that.
    And the reality, then, is that, under the PAYGO current 
framework, supporting these obligations that we have undertaken 
to our veterans has to compete with every other expenditure. 
And there will be pressure. And the reference to the Debt 
Commission, the reference to former Senator Simpson's 
testimony, is evidence of that kind of pressure that will be 
put on veterans' expenditures.
    Mr. Moran of Virginia. Well, thank you, Professor.
    You mentioned in your testimony, and Professor Bilmes has 
as well, the fragmented cost of war. Just one example, in the 
Defense Appropriations Committee, we put $900 million just for 
traumatic brain injury, and then in this Continuing Resolution, 
I don't think there are two or three Members who are aware that 
we added another $300 million--it was a reprogramming of money 
for something else--bringing it up to $1.2 billion just for 
traumatic brain injury just for 1 year, fiscal year 2010.
    But the other question I wanted to ask--and then I will 
yield back the time. And I thank the Chairman. Senator Webb and 
others in both the House and Senate strongly supported, and was 
passed, a GI Bill of Rights. The idea was to basically create a 
middle class again in the way that we did after World War II, 
by enabling returning veterans to get higher education and be 
able to lead to fuller, better employment prospects. Because, 
as you said, 30 percent of our veterans returning home are 
unemployed. But this also extends to the family, the wives and 
spouses.
    Do we have an estimate of the cost of that? And I know that 
Chairman Miller would be very much interested, as well. What 
are we paying for that portion of higher education out of the 
same Federal budget?
    Professor Bilmes.
    Ms. Bilmes. I don't have, an estimate for that, but I think 
it is a good question. And I think it is, like all of these 
numbers, a number that could be calculated.
    One of our overall points throughout the process of working 
on these issues has been that there is actually very little 
attention to getting robust estimates in the veterans field. 
And when you compare the amount of effort, for example, that 
goes into studying the Social Security system compared with the 
amount of effort that goes into studying the long-term cost of 
veterans, whether it is the educational, the Transition 
Assistance Program, the research funding, the benefits, et 
cetera, it is a tiny fraction, not in scale with the, you know, 
actual, absolute size of the liability.
    But, unfortunately, I don't have that particular number.
    Mr. Moran of Virginia. No, but it would be interesting to 
calculate.
    Dr. Stiglitz. Can I just make one further comment about the 
importance of providing the kind of benefit, the GI benefits? 
As we move to the All-Volunteer Army, we are recruiting 
particular socioeconomic groups into the Army and other 
military services. And these are often among the parts of our 
society that are less privileged. And, unless we do that, we 
will continue to have the problems of the 30 percent 
unemployment, which is a long-run problem for our society.
    And there has been reference made to high suicide rates, 
high problems of family. Those problems are all compounded when 
people can't get a job. And when people don't have the adequate 
education, in a modern economy it is very difficult to get the 
jobs.
    So I view this as part of our social obligation to those 
who fought for us which we are now not really fulfilling.
    Mr. Moran of Virginia. Absolutely. And one cost that--a 
very substantial cost that we don't factor in is the burden on 
local municipal human service programs. Because these folks, a 
large number go back into the community but still have mental 
health adjustment problems, domestic abuse problems and so on 
related to their combat experience. And it is a municipality's 
responsibility to care for them, and we don't calculate that 
cost, let alone add it to the full cost of the war. And I 
appreciate it.
    Chairman Filner, thank you so much for having this hearing 
and thank you for your commitment to this issue.
    The Chairman. Thank you, Jim. We appreciate your testimony 
today.
    This should not be radical, as I said in my remarks. This 
deferred liability is a common, accepted practice, and yet your 
testimony is mind boggling. The things that we have to take 
into account and that we can take into account, Professor 
Bilmes, we don't. It is not rocket science as you are pointing 
out, that we do it.
    By the way, before I go further, I am not sure this hearing 
would have taken place without the incredible work of a former 
Congressman who is with us today, Tom Andrews from Maine. Tom, 
thank you for helping us do this and your persistence and 
understanding of the breadth of these issues. Thank you so 
much, Tom Andrews.
    Politicians and journalists like to get a headline out of 
this. You wrote the book, ``The $3 Trillion War.'' What would 
the title say if you were doing it now? Could I say $4 
trillion? Could I say $5 trillion? Could I say $4 to $6 
trillion? We Congressmen like a quick headline. I know you guys 
don't, but help us out.
    Dr. Stiglitz. When we originally did the book, the real 
numbers were $3 to $5 trillion. The reason we chose the title 
$3 trillion is not because we thought that was the most 
accurate number, but, at that time, if we had used one of the 
larger numbers, we would have lost credibility.
    The interesting thing is that after--as I said in my 
testimony, after we came out with the number $3 trillion, the 
CBO went and looked at it and the Joint Economic Committee, and 
they said we were basically right.
    There is an interesting point here, which is that we had a 
little bit of a scrap with the CBO on a few numbers, actually, 
on these numbers that are talking about--that we have been 
talking about, the veterans' cost, the disability and medical 
costs. They said that we had overestimated those. We felt very 
confident that we had underestimated them.
    And I don't want to crow. You shouldn't take pride in this 
kind of thing. But the fact was that we had underestimated 
them, and they had vastly underestimated those costs. If you 
look at those numbers there, what you see is that the revised 
numbers are 25 percent or more greater than our original 
numbers. So they are a substantial increase.
    I suppose if our original book had been called ``The $3 to 
$5 Trillion War,'' it would not have sold as well. The new book 
should be called ``The $4 to $6 Trillion War and Increasing.''
    But I think what is clear--and we will be getting a full 
assemblage of numbers for a paper we will be presenting at the 
American Economic Association meetings in January. But what is 
clear from what we have already said is that the total cost is 
substantially higher than ``The $3 Trillion war.''
    Ms. Bilmes. I just want to say that I am very conservative 
and I had strongly favored when we wrote the book calling it 
``The $3 Trillion War.'' Because no matter which way you 
counted it up, if you looked at just the economic cost or just 
the budgetary cost, it always reached $3 trillion. So we didn't 
want to add anything that could even conceivably be construed 
as double counting.
    I think what we know now is the long-term veterans' costs 
are, as of now, beginning to approach the size of what we have 
already spent in actual combat operations, and that is the 
really startling thing. Because the tail of this war, the tail 
of all wars, is very, very long; and this tail in terms of cost 
is likely to be longer than others. And we know that at least 
the minimum we can say is that the veterans' costs will be 25 
percent higher than we had expected.
    The Chairman. Every decision that we have thought about 
putting into legislation to help veterans of previous wars, 
whether it is the atomic veterans that I mentioned before, or 
the Agent Orange veterans, Persian Gulf War veterans illnesses, 
or PTSD, we cannot get money because of the PAYGO system for 
intelligent and thoughtful legislation. We have 250 Members on 
a bill to begin to adequately compensate Agent Orange victims. 
We are talking about 40 to 50 years ago. It scores at $20 
billion so we can't do it.
    This is a disgrace that we can't even fund care for the 
more recent veterans because of the costs. Wherever we look, it 
is the same answer; it is the same barrier that we deal with.
    I don't want to necessarily equate veterans' benefits with 
other programs like Social Security or Medicare, which have 
been the programs that have threatened to bankrupt us, but as 
you look at the VA figures, there is also an incredible impact 
on our budget. Senator Simpson apparently already warned us 
that we may not have to do as much for veterans because of the 
impact. It looks to me that the deferred liability is rivaling 
some of that--is that a fair statement.
    Dr. Stiglitz. First, let me just say the numbers are very 
large, as Professor Bilmes pointed out. The government's own 
accounting talks about a $1.5 trillion gap, but that doesn't 
really include the kinds of calculations that we have just 
done. So it is clearly vastly conservative.
    But I think I would make a very big distinction between 
Social Security and Medicare on the one hand and these 
benefits. Because, as you pointed out, Congressman, the right 
way to think about this is deferred compensation. This is 
really--they provided a service, and this is part of the 
contract. The contract when you go to fight in a war, you 
expect to get medical care and disability if you get injured. 
And to me it is a moral commitment. It is effectively a 
contractual commitment in a way that is really quite different 
from Medicare and Social Security. So, in my mind, putting 
these in the same basket, in the same framework is really the 
wrong way of thinking about it. They are all obligations.
    The Chairman. How about just the number.
    Dr. Stiglitz. They are unfunded liabilities, and it is a 
very large number--it is a very large number that has been 
almost totally ignored. And what is so disturbing, of course, 
is--what we have talked about--these two relatively small wars, 
Afghanistan and Iraq, have increased that number by, in what we 
view as our moderate, realistic case, almost a trillion 
dollars, which to put into perspective, as Professor Bilmes 
pointed out, is essentially the amount we spent on operations. 
So that is a large amount that was not talked about when we 
went into this conflict.
    The Chairman. I have never argued with a Nobel Laureate 
before. But since I have a Ph.D., I can argue with you.
    Social Security to me is that contract. You pay into a 
system and we have a contract that you will be helped in your 
older years. Even with Medicare, you pay into a system, and we 
make a contract that we will not allow you to fall into poverty 
because of health care costs.
    I know you are trying to make a distinction, but I think 
that what it does is that it shows the severity of the problem, 
which people are ignoring. That is all I am trying to get at. I 
don't think we, as a Nation, want to know the true cost. I 
think that is the problem here.
    When I read those casualty figures every day or every week 
in the paper, the newspapers can talk about how many people 
have been admitted to the health care system--if we wanted to, 
we could have those figures. It is like looking at the 
homeless. Nobody wants to look at it. You know it is there; and 
if I had to think about it, it would boggle the mind. So we 
don't want to know. And I think the bureaucracies who are 
involved in this really don't want to know or want us to know.
    In 2005, the VA came to the Committee and said, we are a 
couple billion dollars short. I asked, why? Their response was, 
``Oh, we didn't take into account there was a war going on.'' 
These are the folks who we are relying on for accurate 
information but they forgot the war was going on.
    I just want to mention to my colleague, that this Veterans 
Trust Fund that I was mentioning that we are going to set that 
up the necessary funding. I tried an amendment on the last 
supplemental, and I am going to do it on every war bill that 
comes up.
    I just took as an arbitrary figure that the VA budget is 
about one-sixth of the Defense budget. So I said, let us do a 
surcharge--if I can use your term, Jim--of 15 percent on every 
war bill and put that money into the trust fund. All our 
colleagues on the Armed Services Committee said, well, we can't 
do that. You are raising the cost of war too much.
    If I may quote my grandchildren on this, ``duh,'' that is 
the point, show what the real cost is. If it is 15 percent 
higher every year we are going to have to wrestle with how we 
define that.
    This trust fund is sort of becoming the budget for the VA. 
The fund would have even more money as these costs pile up over 
the years. We know a trust fund is not a lock box, but I think 
the concept we have to stress every time is that when you vote 
for war, vote for those who are going to suffer in the war.
    I don't see the VA doing these kinds of calculations. They 
have a model for how much it is going to cost in the next 
fiscal year, but you would think they would be thinking about 
these deferred liabilities. It doesn't sound like they are 
doing it. You recommend increasing their expertise in these 
fields.
    Ms. Bilmes. Right, right.
    The Chairman. I think it is more than that, and I don't 
think they want to think about it, myself.
    Ms. Bilmes. Well, I think that the comparison to Social 
Security and Medicare doesn't work in terms of scale because 
the Social Security is so much larger, the Medicare scale than 
the veteran's scale. Where it does work is you are also facing 
a long-term deferred liability. And the quality of the 
actuarial function and the ability to think about these issues 
at Social Security and Medicare and the availability of 
information is just an order of magnitude higher. And what I 
see at the VA is a weakness. Because if we were going to go to 
a model with a more mandatory component, you would need to 
develop that capacity to actually figure out on how to 
forecast.
    If I could just make one other comment--to Mr. Moran's 
comment around how would we fund a trust fund would we need to 
have a surtax--there are a number of models for funding it, but 
I don't see that it would necessarily have to be funded through 
a war tax, although that is one option. Right now, there are no 
mechanisms for designated war bonds, for example. So there is 
no method not just for individuals but for institutional 
investors who could be asked by their shareholders and by 
Congress to step up to the plate and finance portions of a 
Veterans Trust Fund, for example, through a low interest--some 
kind of subsidized war bond that could be used to endow a 
Veterans Trust Fund, and there are a number of other kind of 
options. So I would see, given the current environment and the 
economy, that in terms of thinking about this idea a surtax 
wouldn't be the only option.
    Mr. Moran of Virginia. If you would yield, Mr. Chairman, 
just a moment.
    Of course, the purpose of it was not just the budgetary 
mechanical process of paying for it but raising the issue so 
that when you make this decision are you also willing to pay 
for the results of the decision you are about to make. And so 
the surcharge being a discreet funding mechanism served that 
benefit of being--of forcing the decision makers to calculate 
that into their decision-making process. So thank you.
    The Chairman. Thank you, Jim.
    We thank you for your testimony. The book that you wrote 
opened a lot of eyes. It was a great title and it helps us in 
shorthand to make these points and you continue to add to it.
    I want your institutions to start thinking about giving 
tenure and promotions. You said you are going to be at the 
American Economic Association? Is that what it is called? If 
you write a paper for testimony, you should get extra credit 
because you are being peer reviewed right here, in my opinion. 
Thank you so much. You are really making a contribution to our 
understanding of all of these issues.
    We will proceed to Panel Two.
    We have with us on Panel Two--retired Major General John 
Batiste, retired Major General William Nash, and retired 
Colonel James McDonough. We thank you not only for your active-
duty service but you thinking about these issues when you are 
retired and trying to help all of our citizens have a better 
quality of life.
    We thank all of you for being here. General Batiste, the 
floor is yours.

     STATEMENTS OF MAJOR GENERAL JOHN BATISTE, USA (RET.), 
  ROCHESTER, NY; COLONEL JAMES D. MCDONOUGH, JR., USA (RET.), 
   PRESIDENT AND CHIEF EXECUTIVE OFFICER, VETERANS' OUTREACH 
CENTER OF ROCHESTER, NY; AND MAJOR GENERAL WILLIAM L. NASH, USA 
        (RET.), WASHINGTON, DC (INDEPENDENT CONSULTANT)

      STATEMENT OF MAJOR GENERAL JOHN BATISTE, USA (RET.)

    General Batiste. Thank you, sir. It is great to be here.
    I am a 31-year veteran, combat veteran, first Gulf War, 
Bosnia, Kosovo, Iraqi Freedom, Chair of the New York State VA 
Commission, Board Member of the Veterans Outreach Center, Board 
Member of the great program called Warriors Salute. It goes on. 
I have a passion for veterans.
    The Chairman. You are overqualified. You are dismissed.
    General Batiste. Let me be very brief. You have my comments 
in writing, but let me just capture the high points, what this 
is all about.
    We are draining our Treasury in blood and dollars with 
little to nothing to show for. We have never had a real 
comprehensive national strategy to deal with global Islamic 
extremism or whatever you want to call it. I would recommend 
everyone in this room read Bob Woodward's book. It lays it out.
    Our interagency process is broken. The last panel was 
terrific, but the 800-pound gorilla in the room is that we 
don't have an interagency that could develop a strategy to do 
anything. Let me expand on that a bit.
    It is a failure of both the Bush Administration and the 
Obama Administration. Most people that I talk with confuse the 
defense strategy with a comprehensive national strategy. Don't 
fall into that trap. Of course, the Defense Department has a 
strategy. But the national strategy does not exist, no process 
to develop it, no trained planners in the 18 major departments 
and agencies to do it; and, as a consequence, there is no unity 
of effort, no teamwork, no base document that lays out the 
specified tasks to all 18 departments and agencies. Nobody is 
in charge, no process to balance the ends, ways, and means. And 
that is exactly what the last panel told you.
    Why are we discussing a Veterans Trust Fund 9 years into 
these wars? The reason is simple. There was never an 
interagency process to develop the strategy with the VA at the 
table to figure all of that out when it should have been 
figured out. We might very well have decided if we had done the 
strategy right that the ends, ways, and means were not in 
balance and, therefore, this was not a good idea. That at the 
end of the day is the bottom line.
    I would recommend that the Congress develop and do for the 
interagency process what the Goldwater-Nichols Act of 1986 did 
for the Department of Defense; and I offer that up to any 
Member who wants to, in my opinion, grab hold of the most 
important issue in our country today. And until we do that, we 
will never handle a Katrina right, we will never deal with an 
oil spill right, we will never deal with peak oil, we will 
never solve global Islamic extremism. We can't plan our way out 
of literally anything.
    In conclusion, I will say again, as I have said many times, 
that how we treat our veterans defines our national character. 
In my view, based on my position--my observation within New 
York State and the country that we collectively get a failing 
grade. There is no synergy between Federal, State, county, and 
community-based organizations and efforts that are ongoing.
    There are a million vets in New York State. Most of those 
are not being served. Their needs are absolutely not being met. 
Three hundred thousand Vietnam vets in New York State that are 
trying to deal with the 19 presumptive illnesses of Agent 
Orange. They are going nowhere. There are 80 to 90,000 Iraqi 
and Afghanistan War vets in New York State.
    I could sit here for days and give you examples of how 
these young soldiers, men and women, are being let down by you 
and I. I won't do that to you.
    But someone has stated that we are living in a sea of 
goodwill. I believe that is the case with all the people that I 
talk with. But there is--let me be very clear here. There is a 
huge difference between sending care packages from being fully 
committed to doing the right thing for veterans for as long as 
it takes.
    Sir, thank you.
    [The prepared statement of General Batiste appears on p. 
53.]
    The Chairman. Thank you so much. Can you, by the way, 
define the Goldwater-Nichols Act?
    General Batiste. The Goldwater-Nichols Act of 1986 took a 
dysfunctional Department of Defense, an Army, a Navy, a Marine 
Corps and an Air Force, all of these organizations working at 
odds against each other in a stovepipe organization and did so 
much to bring that team together, created the position of the 
Chairman of the Joint Chiefs, the Joint Staff, and today the 
services act like a team. There is unity of effort.
    I have served on the Joint Staff. Others in the room have 
as well. It works.
    The interagency process, on the other hand, needs this 
solution very quickly. And, again, it goes well beyond taking 
care of veterans. This is about doing the right thing for our 
country right now. The past Administration and the current 
Administration have not fixed it. It is a serious problem. And 
until we fix it, we are going to continue to meander. If you 
don't know where you are going, any road will get you there.
    The Chairman. You just sped up my retirement from Congress 
for many years. Thank you, sir.
    General Nash.
    General Nash. Mr. Chairman, with your permission we should 
ask Colonel McDonough to speak first.
    The Chairman. Okay, Colonel McDonough.

    STATEMENT OF COLONEL JAMES D. MCDONOUGH, JR., USA (RET.)

    Colonel McDonough. Chairwoman Filner and Members of the 
Committee, I would like to thank you for the opportunity to 
appear before you today to discuss the true cost of war and its 
impact on veterans and their families, which is where I will 
spend my time.
    The truth about caring for veterans and their families in 
this country is that, for the vast majority, it is a luck of 
the draw proposition, determined largely by one's geographic 
location and proximity to advocacy and resources that define 
success or failure as a veteran. Some will draw the card needed 
at precisely the right moment, and others will not. Some 
veterans will get help, and other veterans will not. The best 
we hope for as veterans to find an advocate who can help teach 
us what it means to become a veteran of our Armed Forces. I say 
this confidently after serving 26 years in the active Army, 
becoming a veteran and serving the past 3 years as Director of 
New York State's Division of Veterans Affairs.
    The true cost of war in some part can be tracked by our 
country's willingness to consent to sending young men and women 
into battle. If willing to spend it all, citizens, through 
their elected representatives, provide their consent in return 
for the understanding that the Nation will be behind each and 
every warrior and their family as they head into battle. The 
Nation will provide for their every need if the circumstances 
demand, because we ask so much of each of them. This construct 
is fundamental to the American warrior, but I question whether 
it is shared by all in this country.
    The sea of goodwill referred to by General Batiste during 
this morning's testimony before Congress is a phrase used by 
some in the Pentagon to describe and characterize how America 
views its support towards our veterans and their families, 
including me and mine. As the leader now of the Nation's oldest 
nonprofit for veterans and their families, I question such 
claims that a galvanized effort is under way in this country 
behind its veterans and its families.
    From my perspective, our citizenry is indeed supportive of 
sending young Americans into battle. We have their consent to 
do so. But little to nothing is understood about their actual 
needs upon returning from battle and reintegration back into 
the very community from which they departed.
    One reason for is that our country lacks a coherent 
national strategy, such as General Batiste described, to not 
only go to war but to come home and care for those who fought 
these wars as well. And while I believe it is in our country's 
best interest to foster that sea of goodwill around caring for 
veterans and their families, only ponds and lakes currently 
exist across this country unconnected by a coordinating 
tributary, linking river, or supporting stream. These separate 
and distinct efforts spring up daily but lack context, fit, and 
perspective, often leaving veterans and their families only to 
recognize and receive a fraction of their earned benefits or 
access to health care and services to support their 
reintegration. There is no sea in the sea of goodwill, only 
disjointed smaller bodies of water, which serve a minority of 
our veterans and their families and very poorly at that.
    So how do we improve upon that? Point one, start leveraging 
community-based private-sector providers to provide better care 
for veterans and their families. At the end of the day, what we 
want is barrier-free access to services and our families 
included to address the aftermath of war.
    On any given day in America, only a minority of returning 
veterans actually use VA services, leaving a majority of 
returning veterans and their families somewhere outside the 
VA's portfolio of services and benefits. And, remember, these 
are benefits and services they have earned due to volunteer 
active service in the United States Armed Forces.
    So the first thing to reckon with in creating the 
conditions necessary for a sea of goodwill to exist in this 
country is that our system designed to care for veterans, the 
VA, the Department of Veterans Affairs, must be more inclusive 
to capture the majority versus the minority of veterans. To 
reach the majority of returning veterans not using their 
service, the VA must include community-based providers as part 
of a more coherent delivery network, private providers 
supported by the VA and working alongside public providers to 
deliver barrier-free and high-quality veterans' services, 
benefits, and programs.
    The place to start is with our families, since that is 
where the VA is not charged with any responsibility outside its 
veterans' centers. To think for a moment that you can somehow 
effectively treat the veteran absent his or her family where 
residual harm and damage lingers fails to understand one of the 
true costs of these wars, namely, that our families, spouses, 
and children have become casualties as well. So to understand 
the true cost of war, the system in place to care for veterans 
and their families must work to account for and include all of 
us who have served and our families.
    How this country supports a system of care for a minority 
of veterans at the expense of the majority is something we all 
need to understand in order to advocate for change. In our 
community-based counseling center, Veterans Outreach Center in 
Rochester New York, we see on average 53 new veterans and 
family members every month; and that statistic is repeated in 
community-based clinics and counseling centers across this 
country outside of the VA.
    Our housing services, which consist of emergency, 
transitional, supportive, and independent living for homeless 
veterans, operates at capacity, 28 units every month. We have a 
waiting list just to get in. Folks can stay with us for up to 2 
years.
    Twenty-five percent of our census today is compromised of 
veterans who have served in Afghanistan, Iraq, or both, which 
brings me to my second point. The true cost of these wars must 
include the sum cost of underwriting a troubled force. A 350-
page report issued in July after a 15-month investigation into 
the Army's rising suicide rate found that levels of illegal 
drug use and criminal activity had reached record highs, while 
the number of disciplinary actions and forced discharges were 
at record lows. The result the Army found is that drug and 
alcohol abuse is a significant health problem in the Army.
    Where the Army once rigidly enforced rules on drug use, it 
got sloppy in the rush to get soldiers ready for the 
battlefield. From 2001 to 2009, only 70 percent of DUIs 
(driving under the influence) and 61 percent of positive drug 
tests were referred to the Army's substance-abuse program, and 
drug testing became haphazard. In 2009, 78,517 soldiers went 
untested for illegal drugs. Statistically, the Army estimated 
that 1,311 offenders probably escaped detection. ``Where did 
they go,'' said General Chiarelli, Vice Chief of Staff of the 
Army.
    We have kids that are going to have some behavioral health 
issues. The real hard part for to us determine, okay, I am 
willing to help this kid, but how long can I help him? These 
troubled kids have since separated and are now veterans and are 
back in every community in this country. As I stated a moment 
ago, they make up 25 percent of the homeless veterans we serve 
every day in upstate New York.
    Why, if we are the greatest country in the world, the one 
that prides itself on reminding others it cares for those that 
serve, do we continually pour good money down bad holes and 
experience the same substandard level of care we have come to 
almost expect as veterans? Has it become that bad that our 
expectation as veterans is to be cared for poorly? Could a 
national strategy help? Certainly it can't hurt, just as 
legislation to create a Veterans Trust Fund can't either.
    An up-front investment to be made prior to going to war 
serves to remind everyone that the true cost of war is 
calculated differently, that human factors, families, children, 
spouses, veterans actually have real value and their care must 
be accounted for to receive our Nation's true consent to wage 
war. If America paused for only a moment to count the true 
cost, it might just not like the price tag associated with 
their consent. As a veteran and now someone who cares for 
veterans and their families in a community setting, perhaps the 
cost of obtaining the Nation's consent is the greatest cost to 
be calculated beforehand.
    Chairman Filner, I appreciate the opportunity to speak 
before you today. Thank you. This completes my statement. I 
will be happy to answer any questions you may have.
    [The prepared statement of Colonel McDonough appears on 
p. 54.]
    The Chairman. Thank you so much.
    General Nash.

     STATEMENT OF MAJOR GENERAL WILLIAM L. NASH, USA (RET.)

    General Nash. Thank you, Mr. Chairman. If it is okay with 
you, I would like to submit my statement for the record and 
just make a few comments here.
    The Chairman. That will be done. Thank you.
    General Nash. Sir, I begin with thanks, thanks to you and 
thanks to the Committee for your concern for veterans and their 
families.
    I also want to say that I could not be happier with our 
Secretary of Veterans Affairs. I think General Shinseki, who is 
an old friend, has taken on a very hard job and needs all of 
the help you and I can give him. And I would thank him for his 
service, and I would encourage us all to help him push those 
rocks up the hill.
    In the early 1980s, sir, I was a young commander in Germany 
and worked for a division commander. He used to distinguish 
between the love of soldiers and the care for soldiers. And he 
said that a lot of people like to pound the table and talk 
about how much they love soldiers, but some of those same 
professionals failed to understand what it took to care for 
soldiers, to equip them, to train them, to feed them, to pay 
them, to house them.
    The same battalion commander that would make eloquent 
speeches about love of soldiers didn't understand how his 
personnel administration center worked and, therefore, the 
promotion system for the young soldiers was inefficient and 
inadequate to meet the aspirations of the individual soldier 
and needs of the Army for people to be promoted. And my 
commanding General would talk about the fact that to achieve 
care for soldiers you needed expertise and systems, you needed 
resources to make those systems operate, and you needed great 
energy to bring it all together.
    So as I look at what has been described this morning as a 
sea of goodwill, whether it be yellow ribbons or bumper 
stickers or standing ovations at baseball games or even fourth 
of July speeches, I hear a lot of love, but they don't do the 
job of taking care of the veteran and his family. That, too, 
requires expertise, resources, and energy.
    The earlier panel talked about the contract that we have 
with those soldiers, sailors, airmen, and Marines. I would 
point out to you, sir, that that contract is an unlimited 
liability contract that the servicemember signs. It is cosigned 
by their spouses and their family members and their friends. 
We, as a Nation, having chosen to have an all-volunteer force, 
we must underwrite those contracts to full value.
    We have talked a lot this morning about our failure to 
anticipate requirements and to prudently prepare for those 
consequences. Others more knowledgeable, more articulate than I 
have talked about it to great detail. You, Mr. Chairman, have 
recognized the fatally flawed system of processing claims and 
appeals; and I would just say that the bottom line is the need 
for expertise, resources, and energy.
    As to resources, I think the conversation about a forced-
savings program for veterans is sound. The Veterans Trust Fund 
is an idea that I think is desperately needed.
    But I think also we need to look at this issue with a 
broader perspective beyond the Veterans Administration. We have 
decided as a Nation to have that volunteer force, Active and 
Reserve, and I think we need to understand that, while their 
commitment is unlimited in scope, we, too, must examine the 
entire package of pay and benefits that we as citizens are 
willing to spend in order to recruit, train, and reward the 
small group of people, less than one percent of our population, 
that go in harm's way.
    I think we need--as we are examining the true cost of the 
war, we need to have a better understanding of the true cost of 
the all-volunteer force. I, too, was privileged to serve over 
30 years with the dedicated public servants. I have looked 
soldiers in the eye and given them the direct order to face 
battle and its horrible consequence. But I was able to do that 
because I knew that they were trained, equipped, and would be 
cared for and supported. We were individually and collectively 
very capable. We would leave no one behind. So must our Nation. 
We care for those who serve now and forever.
    Mr. Chairman, I look you in the eye and say that we must do 
even more to promote the necessary care through the development 
of expertise, the allocation of resources, and the great, great 
energy that is necessary to take care of those who serve us.
    I thank you very much; and, again, I appreciate your 
working on behalf of the veterans.
    [The prepared statement of General Nash appears on p. 57.]
    The Chairman. Thank you all so much. With your background 
and expertise, I think you have given us a framework to look at 
a lot of things that we observe all the time, but you have put 
it all into a framework that leads to a better understanding.
    As I listened to you and read your testimony, these come 
into conflict with the bureaucratic dynamic that sort of 
works--as individuals--with the 250,000 people that make up the 
VA. Most of them--almost everyone is committed to veterans. 
They want to do a good job. They work hard.
    Yet the institution becomes something different. Many of 
our veterans think VA means ``veterans adversary,'' because 
they are constantly fighting with the VA. The turf wars that 
have made the kind of approach you are looking at, General 
Batiste, is very difficult. How do we break through that 
bureaucracy?
    You said some kind words about Secretary General Shinseki. 
I thought that he would be able to impose more change some 
stuff on the bureaucracy. However, it looks like it is working 
the other way, from my observations. In the Army when he says 
something, it gets carried out. In a bureaucracy, who knows? 
Besides the people who have to tell you it has been carried 
out.
    I will just give you one example of how I had asked General 
Shinseki this in his first meeting, his first appearance here 
on the Committee. I asked him about suicide coordinators that 
were supposed to be in place and I have been told there is a 
suicide coordinator at every hospital. I am only a private and 
you are a general, but let me tell you that you have to look 
beneath what you just heard or what you have been told. The 
janitor who has a 10-percent suicide coordinator job title by 
his name is probably at some hospital or there is a half-time 
person someone untrained. You have to go beyond what you hear. 
If that was his Army staff telling him, he could rely on it. 
But I don't think he can rely on it with the bureaucracy here.
    How do you get through that to get to some of the issues 
you are talking about?
    General Nash. I know General Batiste will have some 
comments on this as well, but I would just start out the 
response is that 2 years is a very short time when you are 
trying to overcome years and years of less than brilliant 
management. And the key to it, in my view, is not unlike the 
approach the services are taking with the emphasis on 
professional development of your workforce in parallel with 
your day-to-day working.
    We send off Army officers to school all the time. We take 
them out of the operating force, which is more and more 
difficult when you are fighting the wars we have been fighting 
for the last 9 years. Even in World War II, we took people out 
of the force for purposes of education. In enduring times of 
peace, we did it even more so.
    So if you don't set up a system to develop your workforce, 
you are never going to get better. You are going to keep 
fighting the same battles day in and day out and, as 
administrations change, all too many people turn over. And so 
the professional force has to be developed in such a manner 
that it provides the continuity. So when the Secretary of 
Veterans Affairs gives an order, there is a reasonable 
expectation it will be carried out uniformly throughout the 
force.
    Now, General Shinseki can tell you stories about having 
those problems when he was Chief of Staff of the Army. It 
wasn't quite as uniform as we all might believe. But I think 
that is very important.
    And the number two thing is I do think we have to look at 
some of our personnel, civilian personnel regulations that 
allow a lack of expertise to succeed.
    The Chairman. General.
    General Batiste. I agree with General Nash.
    I also think that the VA is a very small cog in a huge 
bureaucracy, a bureaucracy that is not defined by teamwork and, 
as I discussed earlier, that it is without process. That 
bureaucracy, as huge as it is, can be reorganized. It will 
probably take something like a Goldwater-Nichols Act to do for 
that process interagency as it did for the Department of 
Defense back in 1986.
    Most in this room don't even know what I am talking about, 
because that is so long ago. We all need to go back and read 
about that and see what happened and what it did.
    But that bureaucracy desperately needs process, it needs 
training, it needs trained planners and every single department 
to include the VA and State Department and the Department of 
the Treasury or whatever, fill in the blank. Responsibilities 
need to be defined. Somebody needs to be in charge. It is not 
the President today.
    We need organization. We need to be able to issue orders to 
the departments and agencies of our governments and have the 
expectation that they will do what they are told. And that is 
absolutely doable. It is possible. Plans developed, plans 
resourced, and then follow through to make sure people do what 
they are told to do.
    I think we are at a tipping point in our country, as I said 
earlier. If we don't fix this, we will never be able to respond 
to a natural disaster. We have some real problems in front of 
us, and right now I would say that this government is 
disorganized, not focused. I, as a citizen, am looking for 
unity of effort, teamwork, and a commonality in what we are 
setting out to accomplish.
    The Chairman. Thank you, sir.
    Colonel McDonough. I am going to take a slightly different 
approach. While I agree with both General Nash and General 
Batiste, I think you have to start with the underlying 
principle at work here. The Department of Veterans Affairs, as 
one of our largest departments in Federal Government, exists to 
serve a minority of veterans and their families. The 
overwhelming majority are not being seen within the tent of the 
Department of Veterans Affair, especially when you add families 
to that.
    We are out in our communities pursuing whatever it is we 
are pursuing, gaining access to health care, counseling, 
benefits. We are doing all of that as a majority in this 
country out in a community setting. So when you look at the 
structure, I really think that what you need to look at is, is 
it performing where it needs to perform.
    What I mean by that is when the Department of Defense 
looked at aging infrastructure, it BRAC'd (Base Realignment and 
Closure) those type of things that were underserving and no 
longer needed. As the defense strategy changed, so, too, did 
where we base troops.
    If you go to some of our aging VA facilities around New 
York State, you are going to walk away with a conclusion that 
they are in the wrong spot serving a handful of veterans, 
whereas in communities where there are a good number of 
veterans, they are not.
    So where they are not, how do you take care of veterans and 
their families? And that is what I mean by leveraging community 
partners. Involve them in the process.
    It is a big tent. The VA is one of those lakes I refer to 
in my testimony. It is not the sea itself. There are many 
players that go to work every day to care for veterans and 
their families. And when you look at the system as a system you 
understand that it is exists only to care for and service the 
minority of veterans that we are all talking about today. The 
overwhelming majority are outside the tent. We are out in 
communities pursuing our livelihood, through private 
physicians, through self-pay.
    There is a way to include that by making sure that the 
system is more comprehensive and looking at the architecture of 
the system and saying where it isn't working anymore, where it 
is underserving there is probably a better way to do it and 
move those resources where they are needed.
    General Nash. Sir, if I could just add, that is a very 
important point. If you are ever asked the solution to the 
problem to care for veterans and their families, whether it 
should be a top-down or a bottom's-up approach, the answer is 
yes. Because it has to be both of those methods used.
    The Chairman. Well, thank you all for your optimistic 
appraisal of the situation. I agree it is doable. It is just a 
massive situation, and have to confront it as a Nation.
    As I listened to you and some of the political streams that 
are going on in our country today I think it may be a reaction 
to focus, purpose, and unity, the lack of direction. People get 
angry and they don't know what they are angry about, but they 
don't see the system working for them. And I think you all have 
helped us understand that a little bit better. Hopefully, we 
can respond in my lifetime to your concerns. Thank you so much 
for helping us understand this better.
    Panel Three can come forward.
    Joining us on Panel Three is Paul Sullivan, the Executive 
Director for Veterans for Common Sense (VCS); Lorrie Knight-
Major, mother of a soldier from Silver Spring, Maryland; Corey 
Gibson, a veteran from Terre Haute, Indiana; and retired 
Lieutenant Colonel Donna Van Derveer from Ashville, Alabama.
    We thank all of you for being here today. If you have 
written testimony, it will be made part of the record.
    You may have the floor, Mr. Sullivan. Thank you again for 
being here.

 STATEMENTS OF PAUL SULLIVAN, EXECUTIVE DIRECTOR, VETERANS FOR 
COMMON SENSE; LORRIE KNIGHT-MAJOR, SILVER SPRING, MD (MOTHER OF 
    VETERAN); COREY GIBSON, TERRE HAUTE, IN (VETERAN); AND 
LIEUTENANT COLONEL DONNA R. VAN DERVEER, USA (RET.), ASHVILLE, 
                          AL (VETERAN)

                   STATEMENT OF PAUL SULLIVAN

    Mr. Sullivan. Good morning. Veterans for Common Sense 
thanks Chairman Filner for inviting us to testify today about 
the true cost of war.
    Allow me to begin with a poignant quote by Jose Narosky, 
``In war, there are no unwounded soldiers.''
    Mr. Chairman, we are here today because, in 2005, the VA 
faced a multibillion dollar budget shortfall because of the 
flood of Iraq and Afghanistan War veteran patients. Similarly, 
in 2007, DoD faced a national scandal at Walter Reed because it 
lacked planning and staff to handle battlefield casualties.
    Another very high and tragic price of our Nation's failure 
to plan for our returning veterans can be seen in the 
skyrocketing suicide rate among our servicemembers and our 
veterans. Sadly, as you mentioned, new records are set each 
year.
    Our comments today about the true cost of war have three 
parts. First, we will talk about VA and DoD statistics; second, 
we will state our support for a new veteran benefit trust fund; 
and, third, we will urge Congress to give the current wars 
meaning for our servicemembers and veterans.
    First, here are the facts. Using the Freedom of Information 
Act, Veterans for Common Sense asked the military to tell us 
how many servicemembers have gone to the two wars; and the 
number is about 2.2 million. The Department of Veterans Affairs 
has treated 565,000 Iraq and Afghanistan War veteran patients 
at VA medical facilities.
    I ask you to look at the chart that we brought on the left 
over there, the first one, veteran patients treated by VA. As 
we can see, we loaded all of the data and it shows a sharp 
rise. And this information was provided to Professor Bilmes and 
Professor Stiglitz for their great work and ground-breaking 
effort to find out the cost.
    The one thing that is most surprising is that the numbers 
keep rising at the same rate, even though there are comments 
that the wars are deescalating and troops are coming back. Mr. 
Chairman, VA averages about 9,000 new patients each month. VCS 
estimates the count of VA patients today is about 619,000. By 
the end of 2014, VCS estimates a total of one million new war 
veteran patients treated by VA. These counts of patients 
exclude veterans treated at military facilities and it excludes 
veterans treated by private care.
    On another subject, the VA has received 513,000 disability 
claims from Iraq and Afghanistan War veterans. Again, we have a 
chart over to my left, and it shows a very steep sharp rise in 
the number of claims from Iraq and Afghanistan veterans, and 
that rate of claims is higher than initially projected by 
Professor Bilmes and Stiglitz showing that their estimates were 
conservative. At the end of 2014, VCS estimates VA will receive 
about one million total claims from Iraq and Afghanistan War 
veterans.
    Switching to the Department of Defense, the military has 
reported 5,670 U.S. servicemember deaths in the Iraq and 
Afghanistan War zones. A total of 91,384 U.S. servicemembers 
were wounded or were medically evacuated due to injuries or 
illnesses. The grand total of U.S. battlefield casualties is 
more than 97,000.
    Here are two important facts. You were looking for 
headlines, Mr. Chairman. There are 100 new first-time veteran 
patients treated at VA for each battlefield death reported by 
the military. A second bullet point, there is one new VA 
patient every 5 minutes from these two wars.
    VCS is here today to endorse the proposal by Professor 
Linda Bilmes and Professor Joseph Stiglitz to create a veteran 
benefit trust fund to make sure our veterans receive the health 
care and benefits they need and earned.
    In their book, ``The $3 Trillion War: The True Cost of the 
Iraq Conflict,'' the experts wrote, and I quote: ``There are 
always pressures to cut unfunded entitlements. So when new 
military recruits are hired, the money required to fund future 
health care and disability benefits should be set aside, `lock-
boxed,' in a new veterans' benefit trust fund. We require 
private employers to do this. We should require the Armed 
Forces to do it as well. This would mean, of course, that when 
we go to war we have to set aside far larger amounts for future 
health care and disability costs as these will inevitably rise 
significantly during and after any conflict,'' unquote.
    VCS agrees with the experts' logical proposal. If we don't 
prepare for our veterans, then our Nation may see more 
troubling news such as more suicides. According to testimony 
today by Professor Bilmes and Professor Stiglitz, the financial 
cost for health care and disability payments may be as high as 
$1 trillion.
    VA has made many impressive improvements in personnel, 
budgeting, and policies in the last 20 months, much of it 
thanks to the efforts of this Committee. VCS encourages 
Congress, VA, and DoD to learn lessons from past mistakes. VCS 
urges Congress to mandate national monitoring and planning for 
the return of our servicemembers.
    A national plan must also include fully funding all needed 
health care and benefits. We must honor and remember our 
fallen, and that is our last message.
    Archibald MacLeish, a World War I veteran and former head 
of the Library of Congress, wrote in a poem: ``They say we 
leave you our deaths. Give them their meaning. Give them an end 
to the war and a true peace. Give them a victory that ends the 
war and a peace afterwards. Give them their meaning.''
    VCS asks Congress to give meaning to our Nation's fallen, 
wounded, injured, and ill who deployed to war. Our Nation must 
learn the painful lessons from prior wars and take care of our 
veterans who are protected and defended our Constitution, even 
when the American public does not support the war or when the 
war was started with misleading claims.
    We close with two powerful messages, Mr. Chairman.
    First, as of today, Veterans for Common Sense estimates our 
Nation currently has as many as 619,000 Iraq and Afghanistan 
War veteran patients, plus a similar number of disability 
claims. VA can reasonably expect one million claims in patients 
by the end of 2014 if the trends continue.
    And, second, our Nation has no strategic plan to identify, 
monitor, treat, and compensate those veterans. We ask you, 
please, fix that today by introducing and passing legislation 
to create a veteran benefit trust fund.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Sullivan appears on p. 58.]
    The Chairman. Thank you, Mr. Sullivan.
    Please, Ms. Knight-Major.

                STATEMENT OF LORRIE KNIGHT-MAJOR

    Ms. Knight-Major. Good morning, Mr. Chairman and Members of 
the Committee. The following details a significant role that 
the nonprofit organizations in the communities have played in 
helping my injured soldier regain his independence.
    My name is Lorrie Knight-Major, and please correct the 
record. I am not a veteran. I am the mother of Ryan Major, Army 
Sergeant retired.
    On November 5, 2003, Ryan enlisted into the United States 
Army for a 3-year term. He was stop lossed. On November 10, 
2006, 5 days after his original discharge date, Ryan was 
critically wounded as a result of an improvised explosive 
device blast while on a mission with his unit in Ramadi. As a 
result of the blast, Ryan sustained multiple massive injury, 
including both legs were amputated above the knee, both arms 
were broken with multiple fractures, extensive peritoneum 
injuries, severe right pelvic fracture, traumatic brain injury, 
and post-traumatic stress disorder.
    Ryan reached Walter Reed within 4 days of the injury and 
underwent multiple surgeries over the course of 6 weeks. Ryan 
was then transferred to R. Adams Cowley Shock Trauma Center at 
the University of Maryland Medical Center, where he stayed for 
1 month. Then Ryan was transferred to the National 
Rehabilitation Hospital (NRH), where he spent the next 7 
months.
    But getting Ryan into NRH wasn't easy because he was an 
enlisted soldier. Before going to NRH, we were given four 
options of VA polytrauma hospitals in the U.S., but none were 
close to home. Ryan's transfer to any of them would have 
required me to travel out of State and live for many months far 
from home without social support and away from my job while 
leaving my minor child at home. This was not an option for our 
family.
    Our veterans should have access to regional trauma 
hospitals and nationally recognized rehabilitation facilities 
that possess expertise on polytrauma that are located near 
their homes. Most families of severely injured soldiers travel 
across State lines and live in hospitals, motels, and hotels 
rooms to be near their injured soldiers for many months, 
placing additional burdens on an already emotionally fraught 
time period.
    Once it appeared very likely that Ryan would survive, I 
started to plan for his return home. Because of the wheelchair, 
major structural changes to our house were needed to 
accommodate him. Two separate architects examined our home and 
determined that we needed an elevator. Through the VA, there 
are three grants available for constructing an adapted home or 
modifying an existing home. To qualify for the maximum funding 
through these grants, veterans have to own the home. Up to half 
of the injured soldiers are single, and they return home to 
live with their parents, other family members or friends. 
Therefore, access to funding through the VA is limited to 
$14,000 for work done on someone else's home where the veteran 
will live.
    This wasn't available for us when Ryan came home in 2007.
    Fortunately, by word of mouth, I was informed about 
Rebuilding Together, a national nonprofit organization that 
provides home rehabilitation and modification services to 
homeowners in need. In 2005, Rebuilding Together launched its 
Veterans Housing Program to address the needs of soldiers 
returning from Iraq and Afghanistan.
    The work done to our home included an elevator, the 
conversion of our first-floor family room into Ryan's bedroom 
with an accessible bathroom, a new deck addition for his 
egress, a new separate central air and heating system for his 
bedroom, and an in-ground generator for emergency purposes and 
escape. The value of these renovations is estimated at 
$150,000. Rebuilding Together made it possible for me to bring 
my soldier home. If we would have had access to the VA grant 
money, there still would have been a $100,000 deficit.
    Rebuilding Together's housing program has rehabilitated and 
modified the homes of 725 veterans and 25 veterans' centers, 
with a market value exceeding $12 million. If these services 
had not been provided, all of these veterans would not have the 
quality of life they now enjoy, since the VA does not fully 
accommodate all of their needs through its grant programs.
    Ryan also received an IBOT wheelchair from another 
nonprofit organization, the Independence Fund. This chair can 
climb stairs and rises in the air, raising the seat height. 
Independence Fund has donated 20 IBOTs to wounded soldiers and 
veterans, totaling $500,000. Again, the VA did not have the 
ability to provide Ryan with this level of specialized 
equipment.
    Ryan also received a service dog named Theodore from Paws 
for Liberty. Theodore is a 3-year-old Belgian shepherd and has 
truly made the biggest impact on Ryan's independence. Theodore 
helps Ryan with retrieving dropped items, helps him navigate 
crowded areas, and helps relieve and mitigate his PTSD 
symptoms. These dogs cost, on average, $15,000 to $20,000 to 
train--again, a resource not offered to Ryan by the VA.
    I have had to reach outside the system and rely on the 
nonprofit community for assistance throughout this ordeal. As 
Congressman Moran stated earlier, the costs have to be picked 
up. In my 4-year experience, it is being picked up by the 
nonprofits and families. We are the ones that are bearing this 
cost. This support should be provided by the government.
    It has been the nonprofits that have provided Ryan with the 
resources for him to live at home with his family, take charge 
of his own care, and allow him to feel safe and sleep at night. 
In light of this, there should be better collaboration between 
the Department of Defense, the VA, and nonprofit organizations.
    Navigating the complex maze of treatment options and 
benefits is a job in and of itself. As a result of caring for 
Ryan and the emotional toll it has taken on our family, I had 
to leave my job to provide the necessary level of medical care 
and advocacy that my son required. This led to significant 
financial hardship. Families should not have to sacrifice and 
bear the burden of advocacy and compromise their own financial 
stability and wellness to ensure that their soldiers receive 
the appropriate and necessary services from the government.
    I do recognize that progress has been made in the caring of 
our injured soldiers. We still have a ways to go. Here are the 
things that I would recommend to improve the lives of wounded 
warriors and veterans: increase the amount of the VA housing 
grant; establish a competitive fund for national housing 
organizations to compete for housing dollars to better enable 
them to provide housing modifications for veterans; service 
dogs are made available by the VA to veterans with service-
connected disabilities, as are done with guide dogs; increase 
the VA automobile grant; increasing the number of authorized 
electric wheelchairs based on a veteran's changing needs; 
mandatory vocational rehabilitation assessments conducted 
before a veteran with service-connected disabilities separates 
from the military; and authorize a clothing allowance that is 
available for veterans to be available to servicemembers with 
similar injuries and conditions.
    As a mother, here are a few things that I would recommend 
that would have made my life easier if they were in place: 
health insurance allowance for myself and my minor son; non-
medical attendant allowance that is provided by the DoD to 
caregivers of veterans who receive medical care greater than 50 
miles from their residence. Since I live within the 50-mile 
radius, I didn't qualify for the DoD benefit, but the VA could 
have filled the gap.
    As an observer with a window seat, here are my 
recommendations for the providers of care: allow private 
providers and facilities to fill in the gaps when a VA facility 
is not in the veterans' community; improve communication 
between all of the providers, regardless if it is the VA, DoD, 
or the private sector; and, thirdly, require a pain team and 
infectious disease specialist as part of the multidisciplinary 
team approach for severely injured soldiers.
    I ask this Congress to not only honor this country's solemn 
oath to care for our veterans, but I urge you to work towards 
the United States being proactive in making funding available 
for our wounded soldiers and veterans. If the United States can 
set aside funds for an unexpected oil spill, surely it can put 
aside monies at the time a war is authorized to take care of 
our military that continues to take care of us, preserving our 
freedom.
    We owe a tremendous debt to our veterans for their services 
and their families' services and sacrifices. So I ask, if the 
nonprofit organizations had not provided assistance, would it 
have been acceptable to the government for my son to have been 
placed in a nursing home? Would it have been acceptable to the 
government for my son to have lived isolated in a basement 
because he didn't have a means of accessing the main areas of 
the house? Would it have been acceptable for my son to require 
sleep medications or someone to be in his room nightly for him 
to sleep? Is this what the government considers to be the cost 
of the war?
    Again, thank you, Mr. Chairman, for the opportunity of 
sharing my personal experience.
    [The prepared statement of Ms. Knight-Major appears on p. 
64.]
    The Chairman. Thank you so much. I know that it is not easy 
to talk about these things, but we appreciate you sharing that 
with us.
    Mr. Gibson.

                   STATEMENT OF COREY GIBSON

    Mr. Gibson. Good morning, and thank you, Mr. Chairman. My 
name is Corey Gibson, and I am a combat veteran from the 
Operation Iraqi Freedom campaign. I am here before you today as 
a collective voice for veterans nationwide. While this may be 
my individualized account, the issues and concerns within my 
time with you are pervasive.
    You all trained me how to fight, how not to turn in the 
face of an enemy, and how to watch out for the better interest 
of my brothers and sisters in arms. Regardless of my daily 
struggles with post-traumatic stress disorder, traumatic brain 
injury, and other diagnoses, don't think that the training I 
received calls for me to stop fighting now.
    On September 23rd, Michelle Obama stated that veterans and 
spouses need support by local employers everywhere. I am sorry 
we can't get Stephen Colbert here to help highlight problems 
with veterans' health care and benefits. Could we send him into 
combat, where he will be forced to make the decision of kill or 
be killed in defense of his country, only to come back to a 
life of physical and mental disabilities so that we can have 
his input? He stated he likes to help people who don't have any 
power but are needed by the American people, and I think that 
is exactly what many of us veterans feel that we are. Where is 
our celebrity?
    I was honorably discharged in October 2004 after being part 
of the initial surge into Iraq as a triage medic for the 555th 
Forward Surgical Team. I was exposed to things on a daily basis 
that will haunt my memories until my dying day. I am proud of 
the opportunity I had to defend my country, but only those who 
went before me, after me, and stood beside me know what that 
means.
    Truthfully, I should be a statistic, one of the many 
faceless veterans who are homeless or worse. I tried to 
integrate myself into a VA system, my local VA system, because 
I wanted to try and utilize my benefits, but also to help 
create a positive reintegration process at my local VA for 
those who were bound to follow me.
    I had voiced my complaints about back, neck, and shoulder 
issues that the Army did not investigate further. My complaints 
fell on deaf ears, as it took me 6 years to get an MRI and have 
the spinal issues that I have documented in my record. I took, 
at the beginning of this year, my own resources to fly to San 
Diego twice a month to get a specialist to start the process of 
a claim, because my own local VA ignored my complaints.
    I have had my personal information potentially leaked on a 
laptop that went missing from the VA and received merely an 
``Oops'' letter. I have been made aware, after an endoscopy 
procedure, that I may have to come back in for blood tests for 
hepatitis C or HIV because of improper equipment sterilization 
within the VA.
    If any of these things had happened in any other health 
care facility, I would be sitting here a wealthy man, and there 
would be many out of jobs due to negligence. But because we are 
veterans, we are subject to deal with the worst our Nation has 
to offer and are expected to be satisfied with that. Why? Why 
is it all too often minimized and eventually swept under the 
rug with no major changes?
    The rate of veterans committing suicide is astronomical. 
Statistics have shown that, last year, more than 125 veterans 
from the Operation Iraqi Freedom and Operation Enduring Freedom 
conflicts committed suicide every week. We have lost more 
soldiers here at home than in-country engaged in combat.
    Mental health services are paramount for our returning 
combatants. My interview, upon returning from Iraq, to decipher 
whether I needed mental health services or not was to be 
marched into a gym, separated from my family by a piece of 
glass, and asked if I wanted to see my family or do I feel that 
I need to talk to someone about my feelings at this time.
    Within the VA system, an individual veteran's appeal for 
benefits can take up to 5 years. A reevaluation after a rating 
has already been established comes every 3. Why is it that it 
seems the system is more proactive in taking things away from 
veterans than reaching those in need?
    It is not just the people who serve, but it is the 
collateral damage destroying the lives of our loved ones who 
watch us struggle on a day-to-day basis and our inability to 
maintain relationships with those people because we do have 
unaddressed issues.
    My fiancee and I have discussed that, if we were to have a 
child before we got married, she would get more benefits toward 
her education than if she were just the spouse of a disabled 
veteran. Organizations such as Veterans of Modern Warfare, Vets 
4 Vets, and the Coming Home Project are stepping up to fill the 
void of the VA's shortcomings. Should they have to do this?
    On the tablet Lady Liberty holds, there is a sonnet, and 
that sonnet ends with, ``Give me your tired, your poor, your 
huddled masses yearning to breathe free, the wretched refuse of 
your teeming shore. Send these, the homeless, tempest-tost to 
me. I lift my lamp beside the golden door.'' Why is it that we 
veterans are outside that golden door, standing under 
overpasses begging for a few pieces of copper?
    I couldn't be prouder to call myself a veteran of the 
United States military that joins me with a collective that is 
made up of some of the best our Nation has to offer. The 
ultimate fear for me and several of my veteran friends is that 
you have invited a veteran in to speak his compelling story and 
shine a light on the truth and it be dismissed. I am not here 
to simply complain, but I am here to point out the fallacies 
within the VA system. But, ultimately, it is up to you to take 
an action to fix this ongoing problem.
    I will end with this quick story. On my deployment, in the 
heat of battle, we took the most severely wounded as a life-
saving measure. One of those was a Marine who came to us with 
his entire leg, from the hip down, looking like hamburger. I 
remember his words to me as he pleaded, ``Doc, do whatever you 
have to do, tie a stick to it if you have to, but get me back 
in the fight because my guys need me.'' How dare we offer this 
population anything less than our best. So I ask you to please 
do something.
    It is the unforeseen cost of the human toll war which 
beckons for a 21st-century veterans fund. This fund, if 
enacted, would mandate Congress to live up to its national 
obligation to acknowledge that caring for veterans is and must 
be a continuing cost of the national defense.
    [The prepared statement of Mr. Gibson appears on p. 68.]
    The Chairman. Thank you, sir.
    Colonel Van Derveer.

   STATEMENT OF LIEUTENANT COLONEL DONNA R. VAN DERVEER, USA 
                             (RET.)

    Colonel Van Derveer. Thank you, Chairman, for allowing me 
to speak today.
    Good morning, ladies and gentlemen and distinguished 
Committee Members. My name is Lieutenant Colonel Donna R. Van 
Derveer, retired. I am originally from Washington, DC, but 
currently reside in Ashville, Alabama.
    I am honored to say I have served 29 years in the Army and 
Army Reserve as a military police officer and served my country 
with great pride and distinction. I served in Iraq as the anti-
terrorism/force protection chief for Multinational Corps-Iraq 
from August 2004 through January 2005. During my tour, I faced 
numerous rocket attacks and barely escaped with my life after a 
small arms round came through my trailer.
    Upon returning from Iraq, I experienced increasing issues 
with sleep disturbance, nightmares, depression, memory loss, 
irritation, anger, and an inability to concentrate and 
multitask. I knew that I had a serious problem but feared that 
my security clearance and career would be impacted by seeking 
help. I did receive surgery on my right knee that I injured in 
Iraq.
    In 2006, I served as an action officer for J8, Protection 
Assistant Division, Joint Staff, Pentagon. During this tour, I 
eventually sought help through Defense Stress Management. Even 
with counseling, I was unable to manage my stress and give 100 
percent to my position. I requested early release from my tour.
    After delay, denial of medical treatment, abusive 
counseling sessions, being relieved of duty, suspension of my 
security clearance, and a 4-day stay in Ward 54 at Walter Reed 
Army Medical Center as a civilian in non-duty status, I finally 
received help. On September 27, 2007, I was put on Medical 
Retention Processing 2 orders and attached to the Warrior 
Transition Brigade at Walter Reed.
    The 2 years, 4 months spent at Walter Reed was no less 
challenging than what I had already faced. The issue of 
improper diagnosis impacted my care. My psychiatrist placed an 
erroneous entry in my medical records, causing a delay of 
proper care for PTSD for over a year. This error impacted my 
Medical Evaluation Board/Physical Evaluation Board, MEB/PEB, 
thereby reflecting PTSD as ``existed prior to service.'' I was 
forced to prove my service and incident occurred in Iraq, since 
females are considered non-combatants even in a combat zone.
    The MEB/PEB process was excruciating for me. From my 
experience, I see the purpose of the DES pilot program is to 
expedite the process to save the Army money rather than provide 
for the soldier's disability compensation and wellbeing.
    I received 50 percent disability from the Army for PTSD and 
90 percent from the VA for PTSD and various other conditions. 
The Army determined that I overcame presumption of fitness for 
PTSD and nothing else, even though, weeks earlier, the PEB 
found that I should receive 80 percent disability and it was 
forwarded for processing.
    As a veteran receiving care through the VA, I have not seen 
a psychiatrist since I retired. I see a psychologist once a 
month versus seeing a caregiver at Walter Reed once or twice a 
week. In my eyes, this is minimal care. I was told that this is 
due to staffing. I was given the option to travel 65 miles one 
way for additional behavioral health care. This is unrealistic 
for me, as well as other veterans.
    The lack of behavioral health care should be of great 
concern. Those veterans placed on the Temporary Disability 
Retirement List are required re-evaluations. My initial re-eval 
was to be in July 2010. On 7 September 2010, I was informed 
that Fort Benning was backlogged due to the psychiatrist 
leaving, that my re-eval would be delayed for another 8 months. 
Putting veterans' lives on hold and extending the transition 
process is unfair and unjust treatment.
    In summary, the transition process lacks concern for the 
soldier veteran from the individual unit through the MEB/PEB 
process to the care provided by the VA. Behavioral health care, 
proper diagnosis, and need for more providers are significant 
issues for the Army as well as the VA.
    The establishment of a Veterans Trust Fund to ensure these 
issues are not experienced by future generations of warriors 
due to fiscal constraints is imperative and should be a 
national priority.
    Thank you very much, Chairman.
    [The prepared statement of Colonel Van Derveer appears on 
p. 70.]
    The Chairman. Thank you.
    Thank you all for being so eloquent. I can only say that 
for putting real lives in front of us as a consequence of the 
decisions that are made or not made, I can only say to you as 
Chairman of this Committee, and speaking for our Committee, 
that your stories will help us make the system better. We are 
recommitted to do that by listening to you. I thank you for 
being here today.
    Ladies and gentlemen, I thank you all for being here. I 
hope we have all learned and, I hope, committed to action in 
the future.
    Thank you so much, and this hearing is adjourned.
    [Whereupon, at 12:22 p.m., the Committee was adjourned.]



                            A P P E N D I X

                              ----------                              

                 Prepared Statement of Hon. Bob Filner,
             Chairman, Full Committee on Veterans' Affairs
    Good morning. The Committee on Veterans' Affairs will now come to 
order.
    Before we get started, I ask unanimous consent that all Members may 
have 5 legislative days in which to revise and extend their remarks. 
Hearing no objection, so ordered.
    Why is it that so many of the men and women who have returned from 
military service in Iraq and Afghanistan are finding it difficult to 
get the care that they need?
    Is it because we failed to understand that the cost of serving our 
military veterans is a fundamental cost of war? Is it because when we 
sent these men and women into harm's way, we failed to account for and 
provide the resources necessary for their care should they be injured 
or wounded?
    Every vote that Congress has taken for the wars in Iraq and 
Afghanistan has failed to take into account the actual cost of these 
wars by ignoring what will be required to meet the needs of our men and 
women in uniform who have been sent into harm's way.
    This failure means that soldiers who are sent to war on behalf of 
their nation today do not know if their nation will be there for them 
tomorrow. The Congress that sends them into harm's way assumes no 
responsibility for the long-term consequences of their deployment. Each 
war authorization and appropriation kicks the proverbial can down the 
road.
    Whether or not the needs of soldiers injured or wounded in Iraq or 
Afghanistan will be met is totally dependent on the budget politics of 
a future Congress which includes two sets of rules--one for going to 
war and one for providing for our veterans who fight in that war.
    The fight to meet the needs of soldiers suffering from the effects 
of Agent Orange, for example, requires that offsets for the necessary 
funding are found in other parts of the budget. It is known around here 
as ``pay-go.'' The Department of Defense has no such requirement. In 
other words, our current system of appropriating funds in Congress is 
designed to make it much easier to vote to send our soldiers into 
harm's way than it is to care for these soldiers when they come home.
    This is morally wrong and an abdication of our fundamental 
responsibility as Members of Congress. It is past time for Congress to 
recognize that standing by our men and women in uniform and meeting 
their needs is a fundamental cost of war.
    Congress should, therefore, account for these needs and take 
responsibility for meeting them at the time that we send these young 
people into combat.
    In short, every Congressional appropriation for war should include 
money for a Veterans' Trust Fund that will assure that the projected 
needs of our wounded and injured soldiers are fully met at the time 
that they are needed.
    This is not a radical idea. Businesses are required to account for 
the differed liability of their company every year. Ask any business 
accountant who has had to report to the IRS. Our Federal government has 
no such requirement when it comes to the deferred liability of meeting 
the needs of our men and women in uniform--even though meeting these 
needs is a moral obligation of our nation and a fundamental cost of 
war. Does this make any sense fiscally or ethically? I think not.
    If, in years past, Congress had taken into account the deferred 
fiscal liability--and moral obligation--of meeting the future needs of 
soldiers injured or wounded in the conflicts that they were sent would 
we have been able to prevent hundreds of thousands of wounded warriors 
from the burden of an overwhelmed veterans' service delivery system?
    And, would veterans and their advocates on Capitol Hill have to 
fight as hard as they do every year for benefits that should be readily 
available as a matter of course? Would they have to worry as much as 
they do today that these benefits will become targets in the debate 
over reducing the federal budget deficit? Would it not be less likely 
that the Co-Chairman of the National Commission on Fiscal 
Responsibility, Allen Simpson, would tell the Associated Press:

``The irony is that veterans who saved this country are now, in a way, 
        not helping us to save the country in this fiscal mess.''

    Today's hearing will examine these and related questions. We will 
begin by focusing on what war actually costs when we take meeting the 
needs of our soldiers into account. To do this we are pleased and 
honored to have with us Nobel Laureate Joseph Stiglitz of Columbia 
University and Linda Bilmes of Harvard, the authors of The Three 
Trillion Dollar War.
    Their groundbreaking book brought a healthy but sobering dose of 
reality into public debates about the wars in Iraq and Afghanistan and 
the long-term consequences of our decision to go to war.
    We are also pleased to have distinguished military leaders, 
veterans of the wars in Iraq and Afghanistan, prominent veterans' 
advocates and families of veterans here today to help us to put this 
question into the sharp relief of the day-to-day reality of those who 
have served their nation in uniform.
    It is time for an open and honest discussion about the moral 
obligation of our nation to our nation's veterans. It is time to 
reflect on the need to reform a process that systematically denies the 
connection between fighting a war and meeting the needs of those who we 
send into harm's way. Our veterans deserve better.

                                 
      Prepared Joint Statement of Linda J. Bilmes, Daniel Patrick
       Moynihan Senior Lecturer in Public Policy, John F. Kennedy
      School of Government, Harvard University, Cambridge, MA, and
       Joseph E. Stiglitz, Ph.D., University Professor, Columbia
               University, New York, NY (Nobel Laureate)
    Chairman Filner, Congressman Buyer, and Members of the House 
Veterans Committee:
    Thank you for convening this hearing today and for inviting us to 
testify on the true costs of war.
    There is no such thing as a ``war for free.'' The history of 
warfare is a tragic cycle of people fighting, killing, wounding, 
exhausting armies and depleting treasuries followed by burying, taking 
care of the wounded, reconstructing, repaying war debts, and recruiting 
fresh troops. The repercussions of war, and the costs of war, persist 
for decades after the last shot is fired.
    Despite this well-worn path, the inevitable costs, the economic 
consequences and the long-term welfare of the troops are seldom 
mentioned at the start of a conflict. Even when they are mentioned, the 
costs and risks are systematically understated. The result is that the 
burden of financing the war, the social cost of lives lost, quality of 
life impaired, families damaged and the expense of caring for veterans 
are typically not provided for in the run-up to conflict.
    All wars, whether long or short, have continuing costs associated 
with the care of those who have fought in them. It is a sobering 
thought that the peak year for paying out disability claims to World 
War I veterans did not occur until 1969--more than 50 years after the 
armistice. The peak for paying out World War II benefits was in the 
1980s--and we have not yet reached the peak cost for Vietnam veterans. 
Even the Gulf War of 1991, which lasted just six weeks, costs more than 
$4 billion a year in disability compensation alone.
    It is obvious now that the wars in Iraq and Afghanistan have been 
far more costly (in terms of both blood and treasure) than its 
advocates suggested at the outset. Even with more realistic estimates, 
we might have come to the same decision about going to war. But the 
absence of reliable estimates meant there was no opportunity for a 
meaningful debate. It has also prevented us from planning ahead for 
future costs.
    The United States has already spent more than a trillion dollars in 
Iraq and Afghanistan for incremental war costs; in other words, costs 
that are in addition to regular military salaries, training and support 
activities, weapons procurement and so on. There are other substantial 
incremental war-related expenditures across government for items 
including military medicine, military recruiting, contractors' life 
insurance, Social Security disability benefits and paying interest on 
money borrowed to finance the war.
    But these figures do not include the long-term budgetary costs of 
veterans care, or any estimate of the economic and social costs of the 
wars.
    It may be hard to believe, but we still do not know the true cost 
of the Iraq war, much less the current war in Afghanistan. The U.S. 
Government budget is based on cash, rather than accrual accounting. 
Government financial accounts track inflows and outflows of funds 
within a fiscal year, ignoring the long-term costs of depreciating 
equipment, purchasing complex weapons systems and caring for disabled 
veterans. Basic information about outlays--what has actually been 
spent--is not readily available. The accounting systems at the Pentagon 
are notoriously poor at tracking expenditures; the Department has 
failed its annual financial audit for the past decade. The 
Congressional Budget Office, the Congressional Research Service, the 
General Accounting Office, the Iraq Study Group and the Department's 
own auditors and Inspector General, have all found numerous 
discrepancies in the Pentagon's figures. Expenditures that relate 
directly or indirectly to the war are fragmented among many different 
departmental budgets and programs, making it laborious to piece 
together a complete picture. Additional war funds are appropriated 
little by little, through supplementary budgets, making it all the more 
difficult to tally up the total costs.
    The most detailed analysis of war costs has been conducted by the 
Congressional Research Service (CRS). The CRS has noted that none of 
the known factors in the increasing war costs, including the operating 
tempo of the war, the size of the force, and the use of equipment, 
training, weapons upgrades and so forth, ``appear to be enough to 
explain the size of and continuation of increases in cost.'' We believe 
this discrepancy relates to the way the war has been fought, with 
excessive reliance on expensive contractors and funding for core 
defense activities getting mixed in with war funding due to poor 
budgeting and accounting.
    The U.S. Government also makes no attempt to capture the economic 
costs (including those associated with deaths or quality of life 
impairment of those injured), much less any tracking of how the economy 
might have fared in the absence of any conflict.
    These full costs are not transparent anywhere in the system. 
Throughout the nine years of conflict in Iraq and Afghanistan, the 
Congressional Budget Office (CBO) has continued to use accounting 
frameworks that focus at best on the budgetary costs of war for 10 
years, even as the long-term accrued costs of the wars and their impact 
on the economy have grown more apparent. The only hint of the full 
costs of providing for military veterans is in the U.S. Treasury's 
financial statements for 2009, in the little-read ``statement of net 
costs'' which uses accrual methods. According to this document, the 
U.S. liability for burial and disability benefits for military veterans 
exceeds $1.3 trillion dollars. (Even this figure--although large--does 
not reflect the full liability, because it excludes medical care and 
other benefits). There is no provision anywhere in the budget for how 
this liability will be paid.
    Consequently, the estimate of budgetary costs that is presented to 
the public and the press is a partial snapshot, based on faulty 
accounting and incomplete data.
    Our work, which is based entirely on government data, was intended 
to fill this void.
    Two years ago we published The Three Trillion Dollar War: The True 
Cost of the Iraq Conflict, in which we estimated that the total cost to 
the United States--including military expenditures through 2017, and 
lifetime health care and disability costs for returning troops, as well 
as economic impacts to the United States--would be $3 trillion 
[i]. This price tag dwarfed previous estimates, but 
subsequent investigations by both the Congressional Budget Office and 
the Joint Economic Committee of Congress found our estimate to be 
broadly correct. To ensure the credibility of our analysis, we 
deliberately used conservative assumptions. As we will explain today, 
the empirical data that has come to light since the publication of The 
Three Trillion Dollar War demonstrates that our cost projections were 
excessively conservative, and that the war has had far-reaching 
economic consequences. In particular, the costs of diagnosing, treating 
and paying disability benefits for veterans of the Iraq and Afghanistan 
conflicts are proving to be much higher than our earlier estimates.
---------------------------------------------------------------------------
    \[i]\ Joseph E. Stiglitz and Linda J. Bilmes. The Three Trillion 
Dollar War: The True Cost of the Iraq Conflict, WW Norton, 2008.
---------------------------------------------------------------------------
    This morning we will focus on three issues.
    First, we will discuss some of the costs that the war has imposed 
on the U.S. economy.
    Second, we will provide an updated estimate for the single biggest 
long-term budgetary cost of the current war, which is the cost of 
providing medical care, disability compensation and other benefits to 
veterans of the Iraq and Afghanistan conflicts.
    Third, we will argue that such costs are inevitable and can be 
estimated to some extent in advance; therefore, the United States 
should make provisions for its war veterans at the time we appropriate 
money for going to war. We will recommend steps that can be taken to 
address this unfunded financial liability.

I. The Cost of War and Its Impact on the U.S. economy

    The United States went to war without a clear understanding of the 
costs to the budget or to the economy. Today we have a better view of 
both the benefits and the costs.
    The benefits of war center on the value of additional security 
obtained by the war. This is a subject on which reasonable people may 
disagree, since it requires assumptions (typically unverifiable) about 
what would have happened in the absence of the conflict. But even in 
this area, basic analytic principles can be of help, especially as we 
confront the challenge of the global war on terrorism, a security 
threat that is markedly different from earlier wars such as World War I 
and II, where our main objective was the defeat of a particular 
government. The wars in Iraq and Afghanistan are different. For 
instance, securing a particular piece of territory--ensuring that it 
cannot be used, for instance, for training of terrorists--may have 
little value, since training and terrorist activity can easily shift. 
We have to have a global perspective. We have seen this as Al Qaeda has 
shifted from Afghanistan, to Iraq, to Pakistan, and to Yemen. Secondly, 
victory in this war, like all such insurgencies, entails winning hearts 
and minds--killing innocent victims, even if only as collateral damage, 
is a sure way to lose this battle. The supply of insurgents can 
increase even as we succeed in killing thousands of the enemy. 
(Economists say that the supply of insurgents and more broadly the 
strength of the opposition are endogenous.) Thirdly, mistakes made at 
one point can have long lasting consequences, some more so than others.
    Economists and physicists refer to this under the name hysteresis; 
historians by the term path dependence. We cannot go back to the world 
as it was, or as it would have been, if we had conducted the war in 
Afghanistan differently, and had not become embroiled in the war in 
Iraq. But the consequences of some actions are more irreversible than 
others, and it is in those areas that we have to be particularly 
careful not to make mistakes.
    Estimating the cost of the war is more straightforward. There is no 
doubt that wars use up resources. The question is how to estimate the 
full magnitude of those resources used and assign values to them.
    The taxonomy of costs centers on (i) resources spent to date; (ii) 
resources expected to be spent in the future; (iii) budgetary costs to 
the government; and (iv) costs borne by the rest of the economy. These 
latter costs are very real, even if the government does not pay them, 
and are referred to as the economic as opposed to the budgetary costs 
of the conflict. In terms of the economic costs, there are 
microeconomic costs--costs borne by particular individual people or 
firms--and macroeconomic costs--impacts on the total economy over and 
above the sum of the micro costs.
    What makes this analysis challenging is that government accounting 
systems do not document most items in a way that would enable an easy 
assessment of the resources directly used, or the full budgetary 
impact. Accurate accounting is important because it provides 
information on the use of resources that is essential for good 
governance. Transparency--clear, accurate financial information that is 
made available in a useable and timely format--is an essential part of 
democratic governance and accountability.
    The way we account for our troops matters. For example, from the 
sole perspective of military accounting, the cost of a soldier's life 
is valued at $500,000, ($400,000 in life insurance and $100,000 in 
``death gratuity'' payment). This number does not reflect either the 
true budgetary cost to government or the economic cost to society. It 
does not include, for instance, the cost to the military of recruiting 
and training a new troop to replace the one who is lost, and the impact 
on morale and mental health on the rest of the unit, which may result 
in higher medical costs. It also does not reflect the economic loss of 
a young person. By contrast, when civilian agencies such as the EPA and 
FDA are evaluating a proposed regulation--when they compare the cost of 
imposing a regulation to the potential lives saved--they estimate the 
value of a life at between $6 million and $8 million.
    Once a government embarks on a war, it has a myriad of decisions to 
make. Not the least of these is the decision about when to exit. An 
accurate assessment of the full costs of war--including, for instance, 
the full incremental cost of a surge of, say, 30,000 troops for one 
year--is an essential ingredient in making good decisions. The 
budgeting and accounting systems should be able to accurately track 
what has been spent as well as to anticipate the order of magnitude of 
future costs. For example, if 50,000 troops have already been wounded, 
it is feasible to estimate the approximate minimum future liability 
that the government will incur to provide these veterans with medical 
care and disability compensation (if a business incurs a liability to 
pay for injuries to some of its employees, it is required to make a 
provision for this liability). For an ongoing war, an accurate 
accounting of costs incurred is important information in assessing 
likely costs going forward. Any business would want this kind of 
information as it made decisions; any publicly owned business would be 
required to keep its books in ways that investors could see the future 
consequences; and good business practice requires that the firm set 
aside money today for future obligations, like retirement benefits, 
accrued today. We should expect no less of government.
    It is important to realize why such information is so important. It 
is partly a matter of accountability--how are our citizens to evaluate 
and judge a particular course of action if they do not know the costs? 
But bad accounting leads to bad decisions. If we do not take into 
account future disability and health costs, there is a temptation to 
scrimp on current expenditures, without regard to future costs. Good 
accounting frameworks would show that such a course was penny wise but 
pound foolish. Some actions entail cost shifting--say from government 
to others. If VA hospitals are underfunded, some of our veterans who 
served their country so well--those who can afford it--may pay some of 
their own medical costs. The total societal costs have not disappeared, 
even if budgetary costs are reduced. This is one of the reasons that 
one needs an assessment of the overall economic costs.
    The overall economic costs are typically much larger than the 
budgetary costs. However, there are instances where this is not the 
case. An example is where payments from the government to the private 
sector exceed the value of the resources procured--i.e., in war 
profiteering, which has been widely documented during the Iraq war. The 
sheer size of the U.S. military operations in Iraq and Afghanistan, 
(the biggest wartime mobilization since the all-volunteer force was 
created in 1973) placed a strain on the enlisted force, which led to an 
unprecedented reliance on paid private contractors. This resulted in 
some cases, in payment of exorbitant sums for simple tasks such as 
painting walls and repairing trucks and gross over-payments to 
contractors such as Halliburton and Blackwater. There have also been 
numerous cases of outright fraud where the U.S. Government has been 
found to have paid contractors for services that were never provided at 
all. Though such problems arise in all government procurement, there 
are normally safeguards in place that limit its scale. During the Iraq 
War, many of these safeguards were suspended or relaxed.
    The best-run government organizations use cost accounting to 
estimate the direct and indirect costs of their activities. They also 
use accrual-based accounting to try to take future costs into account. 
The focus on current-year cash budgeting leads to costly mistakes. For 
example, the decisions not to buy more protective armor for troops or 
not to purchase mine-resistant vehicles certainly saved money on a cash 
basis. But these decisions led, predictably, to much higher death and 
injury rates. So too, the decision not to fund the Veterans Department 
adequately in 2005, 2006 and 2007 reduced current budgetary 
expenditures but at the expense of increasing the long-run (budgetary 
and economic) costs of providing care to returning veterans. These and 
similar decisions were shaped by an accounting system that does not 
provide for the full long-term budgetary costs of current policies and 
by a budgetary system that does not estimate costs to the economy.
    In addition to the known costs of conducting current and future 
military operations and caring for war veterans (which we discuss 
below) the most sobering costs of the conflict are in the category of 
``might have beens''--what economists call opportunity costs. 
Specifically, in the absence of the Iraq invasion: would we still be 
mired in Afghanistan? Would oil prices have risen so rapidly? Would the 
federal debt be so high? Would the economic crisis have been so severe?
    Arguably the answer to all four of these questions is ``no.''
    The first question concerns the ``security opportunity costs'' of 
the war. The Iraq invasion diverted our attention from Afghanistan, a 
war that is now entering its tenth year and which threatens to 
destabilize nuclear-armed Pakistan. By most accounts, the effort is 
encountering serious challenges, and even General Petraeus sees little 
prospect of an early exit. While ``success'' in Afghanistan might 
always have been elusive, we would probably have asserted control over 
the Taliban, and suffered less expense and loss of life, if we had 
maintained our initial momentum and not been sidetracked in Iraq. 
Between 2003 and 2006, we spent five times as much money in Iraq as in 
Afghanistan. It is likely we would have done far better if we had 
devoted those resources to Afghanistan, before the Taliban had re-
established control.
    The second cost is the higher price of oil, which has had a 
devastating effect on the economy. When we went to war in Iraq, the 
price of oil was under $25 a barrel, and future markets expected it to 
remain around that level. With the war, prices started to soar, by 2008 
reaching $140 a barrel. The war and its impact on the Middle East, the 
largest supplier of oil in the world, clearly had something to do with 
the price rise. We believe it was one of the major contributing 
factors--not only was Iraqi production interrupted, but the instability 
it brought to the Middle East dampened investment in this vital region 
from what it otherwise would have been. In our conservative $3 trillion 
estimate, we attributed only $5-$10 of the increase to the war. But, 
given our thirst for imported oil, even that small amount has a big 
impact--it translates into a much higher import bill for the United 
States. We now believe that a more realistic estimate of the impact of 
the war on the oil price over a decade is at least $10-15 per barrel. 
That translates into a $250 billion increase in the cost of war.
    Third, the war added substantially to the federal debt. It is the 
first time in America's history where a government cut taxes as it went 
to war, even in the face of continued government deficits. The U.S. 
debt rose from $6.5 trillion to $10 trillion between 2003 and 2008, 
before the financial crisis. At least one-fourth of that debt is 
directly attributable to the wars. Of course, this doesn't include 
unfunded future liabilities, for instance the more than half trillion 
dollars in future health care costs and disability payments for 
returning troops.
    The increased indebtedness meant that the U.S. had far less room 
for maneuver in dealing with the global financial crisis. Worries about 
the debt and deficit constrained the size of the stimulus.
    But the crisis itself was, in part, due to the war, and while, as 
we will explain below, the estimates that we provided in our book were 
overly conservative overall, e.g. in estimating future health care and 
disability costs, the most serious underestimate involved the 
macroeconomic consequences of the war. The increase in oil prices 
reduced domestic aggregate demand--money spent buying oil abroad was 
money not available for spending at home. The war spending itself 
provided less stimulus to the economy than other forms of spending--
giving money to foreign contractors working in Iraq neither stimulated 
the economy in the short term (compared to investments in education, 
infrastructure, or technology) nor did Iraq spending provide a basis 
for long term growth. Loose monetary policy and lax regulations kept 
the economy going--through a housing bubble, whose breaking brought on 
the global financial crisis. We mentioned earlier that the deficits, to 
which the war contributed, reduced our room for maneuver. But even 
today, three years into the crisis, as we struggle to deal with the 
aftermath--with more than one out of six Americans who would like a 
full time job unable to get one, with one quarter of Americans with 
mortgages owing more than the value of their house--it is increasingly 
clear that the size of the national debt--of which more than $1 
trillion, or more than 7 percent, is attributable to the war--imposes 
important constraints on our response. The result is that the recession 
will be longer, output lower, unemployment higher, deficits larger, 
than they otherwise would have been.
    Counterfactuals--what might have happened if we had not gone to 
war--are always difficult, and especially so with complex phenomena 
like global financial crises with many contributing factors. What we do 
know is that one of the true costs of war is its contribution to a 
worse economic recession, higher unemployment and larger deficits than 
might have otherwise occurred.
    I want to emphasize that there is a marked difference between 
deficit spending to finance investments--in infrastructure, technology, 
education--and to finance a war such as those in Iraq and Afghanistan. 
Borrowing in the former case may make sense, especially when the 
economy has significant unemployment and interest rates are low. Such 
expenditures improve the long-term debt, lower the long-term debt to 
GDP ratio, and enhance growth--in short, they improve the country's 
balance sheet. That is not the case for debt-financed war expenditures, 
which worsen the country's balance sheet.
    The large disparity between budgetary and the full economic costs 
of war means there is a need for a comprehensive reckoning of the cost 
to the economy as a whole. The fact that we have been able to construct 
estimates of both underlines the fact that this exercise can be done 
once there is a will to do it. There are many skilled economists and 
plenty of data in various branches of government. Going forward, it is 
important that major decisions in the military arena, especially when 
they are decisions of choice, are subject to the same sort of rigorous 
analysis, both budgetary and economic. No estimate and no accounting 
system will be perfect. But the discipline that comes from applying 
these techniques routinely should increase the quality of debate and 
enable us as a country and a government to make more informed decisions 
in the future.

II. Updated estimates of long-term budgetary costs for returning Iraq 
        and Afghanistan veterans

    Over the past nine years more than 2.1 million Americans have 
served more than three million tours of duty. More than 1.25 million 
veterans from these conflicts have returned home. The most significant 
long-term budgetary cost of war is providing medical care to those who 
have served, and paying disability compensation, pensions and other 
benefits to eligible veterans. As of this month, 5700 U.S. servicemen 
and women have died and over 90,000 have been wounded in action or 
injured seriously enough to require medical evacuation. A much larger 
number--nearly 600,000--have already been treated in veterans' medical 
facilities for issues ranging from brain injuries to hearing loss. The 
number returning home with serious mental problems has increased as 
troops were obliged to do repeated tours of duty, with shorter spans to 
recuperate. The medical community reports an ``epidemic'' of post-
traumatic stress disorder (PTSD).
    The evidence from previous wars shows that the cost of caring for 
war veterans continues typically rises for several decades and peaks in 
30-40 years or more after a conflict. The costs rise over time as 
veterans age and their medical needs grow. For example, the annual 
disability payment to veterans aged 34 and under is $6633. This rises 
to $8641 for veterans aged 35-54 and to $12,237 for those aged 55-74. 
(In addition, the older veterans who are retired may now receive 
concurrent receipt of benefits from the Defense budget. Those veterans 
who are not enrolled in the VA system are likely to be requiring 
significant costs from the Medicare system).
    However, for several reasons the long-term costs of the Iraq and 
Afghanistan conflicts can be expected to be even higher than in 
previous conflicts. This is due to (a) higher survival rates; (b) 
higher incidence of PTSD and other mental health ailments; (c) a higher 
percentage of veterans claiming for benefits, especially those 
associated with mental health conditions; and (d) more generous medical 
benefits, more presumptive conditions, and higher benefits in some 
categories.
    Let me briefly address each one of these factors.
    First, the survival rate for severely injured troops has increased, 
relative to previous wars, as a result of improvements in battlefield 
medicine and other advances in health care. In Iraq, the ratio of 
deaths to wounded-in-action was 1:7.3; compared with 1:2.6 in Vietnam, 
1:2.8 in Korea, and 1:1.6 in World War II [ii]. This means 
that a large number of seriously wounded troops, some of whom have 
severe disabilities, will require lifetime care. The wars have also had 
a high level of non-hostile injuries; our research shows that such 
injuries were more than 50 percent higher than during peacetime.
---------------------------------------------------------------------------
    \[ii]\ Anne Leland and Mari-Jana Oboroceanu, ``American War and 
Military Operations Casualties: Lists and Statistics,'' February 26, 
2010.
---------------------------------------------------------------------------
    Second is the issue of mental health diagnosis and PTSD. There has 
been a considerable amount of medical research on this subject, 
including a number of recent studies on Iraq and Afghanistan veterans. 
The studies conducted at the University of California, San Francisco 
Medical School (UCSF) and elsewhere control for variables such as 
demographic factors, smoking, BMI, alcohol use, depression, and other 
factors, so they are an important way for us to understand what is 
attributable purely to war exposure.
    There are three key findings in this literature.
    First, the incidence of PTSD is closely correlated to the number of 
exposures to firefights that a soldier experiences. That means that 
almost certainly, the long deployments, multiple deployments, and the 
lack of a clear ``front line'' for many of those serving has 
contributed to the extremely high levels of PTSD and other mental 
illness. There are now close to 900,000 troops who have served two or 
more tours of duty.
    Second, PTSD is widespread, and has increased by 4-7 times since 
the invasion of Iraq. The team at UCSF medical school, led by Dr. Karen 
Seal, studied all returning veterans who had been treated by the VA 
from 2002 through 2008 [iii]. Her team found that 37 percent 
of returning troops received a mental health diagnosis. Almost one in 
five of the troops were diagnosed with PTSD, with others diagnosed with 
depression. The majority of troops had concurrent diagnosis with other 
problems. Younger, lower-rank troops with the highest combat exposure 
were at the highest risk for PTSD.
---------------------------------------------------------------------------
    \[iii]\ Karen Seal et al., 2009, ``Trends and Risk Factors for 
Mental Health Diagnoses Among Iraq and Afghanistan Veterans Using 
Department of Veterans Affairs Health Care, 2002-2008,'' American 
Journal of Public Health, 99(9): 1651-1658. (See also Karen Seal et 
al., 2007.)
---------------------------------------------------------------------------
    Third, there is strong correlation demonstrated between PTSD and 
long-term physical health problems. This includes heart disease, 
rheumatoid arthritis, heart failure, bronchitis, asthma, liver and 
peripheral arterial diseases [iv]. One recent study (Judith 
Andersen et al., 2010) [v] found that PTSD sufferers are 200 
percent more likely to be diagnosed with a disease within 5 years of 
returning from deployment than the control group. Another new study 
(Beth Cohen, 2010) found that that veterans with PTSD utilized non-
mental health care services such as primary care, ancillary services, 
diagnostic tests and procedures, emergency services and 
hospitalizations 71-170 percent higher than those without PTSD. In 
addition, recent studies have shown that traumatic brain injury, which 
is estimated to affect some 20 percent of Iraq and Afghanistan veterans 
(often in conjunction with PTSD) places sufferers at higher risk for 
lifelong medical problems, such as seizures, decline in neurocognitive 
functioning, dementia and chronic diseases [vi].
---------------------------------------------------------------------------
    \[iv]\ Daniel Bertenthal, Beth Cohen, Charles Marmar, Li Ren and 
Karen Seal, 2009, ``Association of cardiovascular risk factors with 
mental health diagnoses in Iraq and Afghanistan war veterans using VA 
health care,'' JAMA 302 (5):489-492.; and Boscarino JA, 2008, ``A 
prospective study of PTSD and early-age heart disease mortality among 
Vietnam veterans: implications for surveillance and prevention,'' 
Psychosomatic Medicine, July, 70(6):668-7; Boscarino, JA, CW Forsberg 
and J Goldberg, 2010, ``A twin study of the association between PTSD 
symptoms and rheumatoid arthritis,'' Psychosomatic Medicine, June 
72(5):481-6. (In the latter, a study of twin pairs showed that the 
highest PTSD sufferers were 3.8 times likely to have rheumatoid 
arthritis compared with the lowest sufferers). (Spitzer has also shown 
increased incidence of angina, heart failure, bronchitis, asthma, liver 
and peripheral arterial diseases among PTSD sufferers).
    \[v]\ Judith Andersen, et al., 2010, ``Association Between 
Posttraumatic Stress Disorder and Primary Care Provider-Diagnosed 
Disease Among Iraq and Afghanistan Veterans,'' Psychosomatic Medicine 
72.
    \[vi]\ See Hoge, C.W. et al., ``Mental disorders among U.S. 
military personnel in the 1990s: Association with high levels of health 
care utilization and early military attrition,'' American Journal of 
Psychiatry, 159(9):1576-1583; see also work from the Veterans Health 
Research Institute.
---------------------------------------------------------------------------
    Regarding the other reasons for higher costs:
    Compared to previous conflicts, a higher percentage of Iraq-
Afghanistan veterans are claiming for benefits, especially those 
associated with mental health conditions. In large part, this is due to 
the outreach efforts that VA has undertaken, as well as the 
introduction of the post-deployment screen for mental health symptoms, 
and successful efforts by VA and many veterans groups and local 
organizations to make returning servicemembers more aware of what they 
have earned and how to apply for it. It is also likely that the 
Internet has made it easier to obtain information and to file 
disability applications.
    In addition, since our book was written, a number of 
recommendations that we and others urged have been adopted. VA has 
expanded the Benefits Delivery at Discharge (BDD) program and Quick 
Start, increased the number of conditions that are presumptive in favor 
of the veteran, liberalized the PTSD stressor definition, increased 
some categories of benefits and outreach, provided five years of free 
health care instead of two, and is in the process of restoring medical 
care to 500,000 moderate income ``Category 8'' veterans.
    VA has also hired more medical and claims personnel, invested 
heavily in IT upgrades to the claims processing system, and is 
preparing to do much more.
    All of these factors contribute to the rising cost estimates we 
will describe.
    Our model for projecting long-term budgetary costs is based 
entirely on government data. We based our projections for troop levels 
on estimates by the CBO and CRS, and we used rates of average 
disability compensation, social security disability benefits and 
medical costs on information from the VBA, VHA, Social Security 
Administration and government economic indicators.
    In our earlier work, we estimated that the long-term cost of 
providing medical care and paying disability compensation for veterans 
of the Iraq and Afghanistan wars would be between $400 billion and $700 
billion, depending on the length of the conflict and future deployment 
levels. This estimate was based on assumptions derived from historical 
patterns of medical claims and disability claims experienced in 
previous wars. Since then we have updated our analysis to reflect the 
actual data for veterans returning from Iraq and Afghanistan and it is 
clear that the costs will be much higher.

Revised Disability Cost Projections

    In 2008 we had projected that between 366,000 and 398,000 returning 
Iraq and Afghanistan veterans would have filed disability benefit 
claims by this point (given 1.2 million returned troops, which we had 
correctly projected). In fact, more than 513,000 veterans have already 
applied for VA disability compensation. In our projections, the VA 
would not have received this many claims until 2013 at the very 
earliest. We had also underestimated the complexity of these claims, 
the number of disabling conditions being demonstrated, and the likely 
increases in disability ratings over time for veterans who have been 
diagnosed with PTSD. We now estimate that the present value of these 
claims, over the next 40 years, will be from $355 billion to $534 
depending on the duration and intensity of U.S. military deployment to 
the region.
    In addition, veterans who can no longer work may apply for Social 
Security disability benefits. We estimate that the present value of the 
lifetime benefits for these veterans will range from $33 to $52 
billion.

Revised Medical Cost Projections

    In our earlier analysis, we had estimated that 30-33 percent (which 
would be fewer than 400,000) of returning veterans would be treated in 
the VA health system by 2010. The actual number is running at more than 
565,000 veterans, which is about 45 percent of discharged troops 
[vii]. In our earlier work, we projected that the VA would 
not reach this level until 2016.
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    \[vii]\ As of June 2010, 2.15 million U.S. troops had served in the 
GWOT in Iraq and Afghanistan and there were 1.25 million veterans who 
were discharged. The number who had filed claims for compensation in 
connection with their service disabilities was 513,000 (Veterans for 
Common Sense, from DoD, previous number of 483,000 from Veterans 
Benefits Administration Office of Performance Analysis and Integrity, 
11/18/09). The number of GWOT veterans who had been treated at VA 
Hospitals and medical facilities was 565,000 (Veterans Health 
Administration).
---------------------------------------------------------------------------
    We had also underestimated the long-term costs of treating and 
caring for these veterans. We had projected that at worst 20 percent of 
veterans would be diagnosed with mental health issues, whereas we now 
know that 30-40 percent of returning veterans are receiving these 
diagnoses. This increases both immediate and long-term costs, given the 
relationship between mental illness and other conditions. We also did 
not account for the cost to VA of adding personnel and increasing the 
mental health infrastructure.
    Accordingly, we can project how disability claims, and medical 
costs of the Iraq and Afghanistan veterans are likely to continue to 
increase with age. In this respect, they are likely to follow the 
pattern of Vietnam veterans, where it is estimated that 30 percent 
suffered from PTSD. For example, the disability compensation paid to 
Vietnam veterans is 60 percent higher than the amount paid to veterans 
who served in peacetime.
    We now estimate that the present value of medical care provided by 
the VA to veterans from Iraq and Afghanistan over the next 40 years 
will be between $201 billion and $348 billion, depending on the 
duration and intensity of military operations in the region.


  Table 1: Estimated PV of Iraq and Afghanistan Veterans Disability and
                              Medical Costs
------------------------------------------------------------------------
         (US$ Billions)           Moderate-Realistic       Best Case
------------------------------------------------------------------------
Medical                           348                 201
------------------------------------------------------------------------
Disability (VA)                   534                 355
------------------------------------------------------------------------
Disability (SSA)                  52                  33
------------------------------------------------------------------------
Total Cost $ billion              934                 589
------------------------------------------------------------------------

------------------------------------------------------------------------
Original Estimate (2/08)
------------------------------------------------------------------------
Medical                           284.8               121.1
------------------------------------------------------------------------
Disability                        388.5               276.6
------------------------------------------------------------------------
Social Security                   43.7                23.8
------------------------------------------------------------------------
Total Cost $ billion              717                 422
------------------------------------------------------------------------


  Other Budgetary Costs

    These estimates do not include a range of additional costs that 
will be paid by departments across government, including veterans' home 
loan guarantees, veterans' job training, concurrent receipt of 
pensions, and higher costs to Medicare and TRICARE for Life for 
veterans who are not enrolled in the VA system. For example, Pentagon 
spending on health care for active-duty military has increased by 167 
percent since 2001 [viii]. It also does not include costs 
paid by state and local governments, or billions of dollars in VA 
capital investments, such as the construction of mental health clinics 
and construction of new hospitals, that will serve all veterans but are 
primarily targeted toward those returning from Iraq and Afghanistan.
---------------------------------------------------------------------------
    \[viii]\ Statement by Rear Adm. Christine Hunter, Deputy Director 
of TRICARE, that Pentagon spending has increased from $19 billion in 
2001 to projected $50.7 billion in 2011. (USA Today 4/25/10).
---------------------------------------------------------------------------
    One of our core recommendations in the book was that Iraq and 
Afghanistan veterans should be able to receive full education benefits, 
on a par with those provided to World War II veterans in the GI Bill. 
Congress and the Administration finally enacted a new GI bill in 2008. 
This is an investment that will yield significant economic benefits. 
However it will also add to the budgetary cost of the war.
    Taking these costs into account, the total budgetary costs 
associated with providing for America's war veterans from Iraq and 
Afghanistan approaches $1 trillion.

Economic Costs of Veterans

    Earlier, we explained how the true cost of war goes beyond the 
budgetary costs; there are much larger social and economic costs. While 
this is true for the country, it is especially true for our veterans 
and their families.
    The military has faced its biggest challenge since conscription 
ended in 1973. In many respects, the ``All-Volunteer Force'' has come 
under enormous strain. Suicide among veterans is at record levels. 
Women troops (who make up 11 percent of the force) have been especially 
hard-hit: divorce rates are three times higher for female than for male 
troops, and more than 30,000 single mothers have deployed to the war 
zone. These social costs are far-reaching. They include the loss of 
productive capacity of young Americans who have been killed or 
seriously wounded in Iraq and Afghanistan, lost productivity due to 
mental illness, the burden on caregivers who frequently have to 
sacrifice paid employment in order to take care of a veteran with a 
disability, as well as increases in divorce, domestic violence, 
substance abuse, and other social problems. Additionally, a substantial 
number of those who were deployed, particularly among Reservists and 
Guards, were self-employed and have lost their livelihood as a result 
of deployment. For many veterans there is simply a diminished quality 
of life, the costs of which are borne by the individuals and families.
    The military has also been forced to employ a shadow workforce of 
several hundred thousand contractors, who have proven to be 
indispensable to the war effort. These contractors have also suffered 
from high rates of casualties, injuries and mental health problems. 
These impose both budgetary costs (through subsidies to worker 
compensation and insurance companies) and social costs in all the areas 
mentioned for troops.
    These substantial ``social'' costs are not captured in the Federal 
Government budget but nevertheless represent a real burden on society. 
In a number of countries, this is actually recognized with quality of 
life impairment lump sum payments. In our book, we attempted to 
determine the monetary value of some of these costs, although many 
cannot be quantified. At that time we estimated that the social costs 
would reach between $295 and $400 billion, in excess of the budgetary 
costs. Given the high number of casualties in the war and the high 
incidence of illnesses, especially mental illness, it is certain that 
the true cost will be even higher.

III. Funding War Veterans

    The scale of our financial commitment to providing for veterans is 
huge; both in terms of the payments we make today--mostly for previous 
wars--and in the future. We have predicted that the long-term cost of 
caring for the veterans of Iraq and Afghanistan will be at least $500 
billion, and quite possibly much higher. But at present, the U.S. has 
no provision for how it will pay for this growing long-term liability.
    The size of the current outgoings for veterans can be seen most 
clearly in the financial statements of the United States on the 
Statement of Net Cost, which lists the gross cost of U.S. expenditures 
minus revenues. It shows that the net cost of providing for veterans is 
the fourth largest cost to the U.S. Treasury. For example, for the year 
ending September, 2008, the net costs were Defense: $740 billion; HHS: 
$713 billion; Social Security Administration: $663 billion; Veterans: 
$430 billion; Interest on the Debt: $241 billion; with all other costs 
far below. In other words, the cost of providing for veterans equaled 
12 percent of the cost of running the country.
    In terms of accrued long-term liability, the Balance Sheet of the 
United States lists $1.3 trillion in veterans' compensation and burial 
benefits, and a liability for $220 billion in veterans housing loan 
guarantees. But this does not take into account the accrued liability 
for providing medical care, or for veterans pensions, or for many of 
the other benefits we intend to provide.
    Yet, while there are extensive debates and hundreds of studies on 
how to fund our obligations for Social Security and Medicare, there is 
little attention being paid to how best to fund veterans' care. In 
addition, both Social Security and Medicare are financed in part by 
taxes on non-recipients. But there is no dedicated mechanism through 
which taxpayers who are not in military service contribute directly to 
caring for war veterans. Funding must come from general revenues, 
competing with the myriad of other demands.
    The consequence of essentially ignoring the cost of caring for 
veterans is threefold.
    First, it understates the true cost of going to war. We know that 
every war will have a long ``tail'' of costs, including the significant 
cost of providing for those who fight in the war, and their families 
and survivors. However, in the appropriations process, we do not make 
any provision for this inevitable cost. This disguises and hides the 
true costs.
    Second, from an economic perspective, it is poor financial 
management. We should not be financing a 40-year long pension and 
benefit obligation from annual budget revenues.
    Third, it inevitably leads to the possibility that veterans' needs 
will not be funded adequately. There are always pressures to cut 
unfunded entitlements. But veterans' benefits are different from Social 
Security and Medicare. They are more akin to ``deferred compensation.'' 
They are payments for services rendered. They are part of the implicit 
contract between our country and those that serve our country by 
fighting for and defending it. The VA has the responsibility to 
determine the availability of VA care based on appropriations levels. 
The financial statements explain that: ``In addition to health care 
benefits for civilian and military retirees and their dependents, the 
VA also provides medical care to veterans on an `as available' basis, 
subject to the limits of annual appropriations. . . . VA's Secretary 
makes an annual enrollment decision that defines the veterans, by 
priority, who will be treated for that fiscal year subject to change 
based on funds appropriated, estimated collections, usage, the severity 
index of enrolled veterans, and changes in cost.'' [ix]
---------------------------------------------------------------------------
    \[ix]\ ``Financial United States Government Notes to the Financial 
Statements for the Years Ended September 30, 2008, and September 30, 
2007,'' Notes to the Financial Statements, Page 73.
---------------------------------------------------------------------------
    VA does not have the capacity to fully estimate its long-term 
obligations, and even with the best will in the world, this may result 
in insufficient funding. It is well known that VA ran short of funds in 
2005 and 2006 due to budget planning that was based on 2001 numbers, 
before the conflict began. As recently as January 2009, GAO found that 
VA's assumptions of the cost of long-term care were ``unreliable'' 
because the assumed cost increases were lower than VA's recent actual 
spending experience [x]. VA is now facing the challenge of 
estimating demand for two years for the advance appropriations. 
However, even this is proving very challenging since, using its current 
model, VA cannot determine its precise operating needs two-and-a-half 
years in advance; yet it is being asked by OMB and the appropriators to 
do this. This places an impossible burden on the top VA officials.
---------------------------------------------------------------------------
    \[x]\ GAO-09-664T.

---------------------------------------------------------------------------
Recommendations

    We recommend a different funding model that would include the 
following:

        1.  Establish a Veterans Trust Fund that would be funded as 
        obligations occur. Although we cannot estimate precisely the 
        magnitude of long-term demands, it should be possible to 
        develop a framework for setting aside some funding at the time 
        war money is appropriated.
        2.  Improve the actuarial capacity of the VA. The VA should be 
        directed to work with the Institute of Medicine to develop a 
        better system of forecasting the amounts and types of resources 
        needed to meet veteran's needs in 30 years or more, when their 
        needs are likely to peak. This should also include forecasting 
        the regional impact and the infrastructure needs of the VA.
        3.  The cost of any conflict that persists beyond one year 
        should be funded by current taxpayers, through war surtaxes, 
        war bond issues, or other means.

Conclusions

    It is commonplace today for government to undertake extensive cost-
benefit analyses of individual projects and regulations, to assess and, 
where possible, to quantify the benefits and costs. Our analysis of 
true war costs follows in this tradition. While expenditures on the 
military represent the single largest item for many countries, it has 
largely been immune from this kind of scrutiny. Even if such an 
analysis does not change the decision to go to war, it can alter how 
the war is fought--and how we plan for the inevitable future costs of 
the war.
    We hope that the kind of analysis that we conducted for the Iraq 
and Afghanistan wars will become routine. While the kind of economic 
calculus that we have conducted can only capture a fraction of the 
broader costs of war, we believe that even a greater awareness of these 
immense economic costs may have a salutary effect. In particular, we 
hope that our work will contribute to a new way of thinking about long-
term veterans costs, a way of thinking that would require us to budget 
for the lifetime needs of war veterans at the same time that we 
appropriate funds for the wars they will fight.
    At the very least, we believe that democratic processes require an 
informed citizenry--and an informed citizenry must have a sense of the 
true costs that are likely to be encountered before it embarks on war. 
[xi]
---------------------------------------------------------------------------
    \[xi]\ For more information on the ongoing costs of war: Visit 
http://www.ThreeTrillionDollarWar.org.

                                 
           Prepared Statement of Joseph A. Violante, National
            Legislative Director, Disabled American Veterans
    Mr. Chairman and Members of the Committee:
    Thank you for inviting me to testify today on behalf of the 
Disabled American Veterans (DAV) about the continuing cost of war. With 
1.2 million members, all of whom were disabled while serving during 
times of war, no organization understands the true costs of war better 
than the DAV. Our core mission is to build better lives for America's 
disabled veterans and their families and survivors, which we do through 
our service, transportation, volunteer, advocacy and charitable 
programs.
    For example, last year DAV National Service Officers provided 
claims representation to nearly a quarter of a million veterans and 
their families, helping them obtain almost $4.5 billion in new and 
retroactive benefits. Our fleet of DAV vans, driven by almost 9,000 
volunteers, transported more than 645,000 veterans to VA health care 
facilities across the country, traveling over 24 million miles in the 
process. Overall, DAV volunteers donated more than 2.2 million hours to 
serve hospitalized veterans, saving the federal government more than 
$40 million in 2009 alone. We understand that everyone who serves 
during wartime is forever changed by that experience, and a grateful 
Nation must always stand up for those who stood up for us.
    Today there are about 23 million veterans, almost 17 million of 
whom served during periods of war and conflict. More than eight million 
veterans are enrolled in the VA health care system, and more than 3.1 
million receive disability compensation for service-connected 
disabilities. To meet these needs, the Department of Veterans Affairs 
(VA) employs over 300,000 people with a budget now topping $125 billion 
annually. These numbers provide a baseline for the cost to care for 
veterans and any calculation of the true cost of war must fully fund 
programs and services for veterans, not just today, but far into the 
future. Since there are witnesses here today who will provide specific 
estimates and projections of the monetary requirements, my testimony 
will focus instead on the moral and practical obligations we have to 
the men and women who served in uniform.
    Mr. Chairman, the true cost of war is not sufficiently measured by 
the dollar cost alone, but must include the human costs. War leaves a 
legacy of pain and hardship borne by the men and women who suffer the 
wounds and bear the scars--both visible and invisible--of having served 
their Nation. War also profoundly affects the families who suffer 
heartbreak and agony of losing a loved one, as well as the family 
members who bear the burden of caring for disabled veterans for a 
lifetime. They too have earned the thanks of a grateful Nation.
    The true cost of war must also include the cost of peace because 
all who defended our Nation and have wounds or disabilities as a result 
of their service--regardless of when or where they served--have earned 
benefits that must be paid for. For these men and women, the price they 
paid in service will continue for years and decades to come.
    Our Nation must fully and faithfully meet all obligations to 
veterans, especially disabled veterans, and my testimony will highlight 
some of the most important obligations that Congress can and must meet 
in the coming years.
    First, we must ensure that all benefits earned by disabled veterans 
are paid in full; Congress must not allow veterans benefits to be 
offset against other Federal benefits, nor eroded by inflation, nor 
whittled down by budget gimmicks, such as the practice of ``rounding 
down'' cost-of-living adjustments (COLAs) for disability compensation 
payments. Every benefit payment must have an appropriate mechanism to 
account for inflation or other rising costs so that its value is not 
reduced over time. After two years with zero increase in disability 
compensation, we would urge Congress to consider whether the Social 
Security COLA is the most appropriate index. Since disability 
compensation is intended to compensate for the average loss of 
earnings, we believe that there are more accurate and appropriate 
indexes or other methods to set rates, such as those that determine 
wage increases for Federal workers or the military.
    Congress must also ensure that disability compensation is paid in 
full to all service-connected disabled veterans, including those who 
retire after a career in the military, by fully eliminating the 
prohibition on concurrent receipt of disability compensation and 
military retirement pay. It is simply unfair that a disabled veteran 
who chooses to complete a career in the military will have his or her 
retirement pay offset by disability compensation, whereas those who 
leave the military to work in any other public or private sector job 
can receive their full retirement benefits and their full disability 
compensation.
    Second, we must fully compensate disabled veterans for their 
sacrifice and loss, which must include compensation for non-economic 
loss and loss of quality of life, not just loss of earnings capacity. 
In its final report released in 2007, the Veterans Disability Benefits 
Commission, which was authorized by Congress in Public Law 108-136, 
recommended that, `` . . . VA disability compensation should recompense 
veterans not only for average impairments of earning capacity, but also 
for their inability to participate in usual life activities and for the 
impact of their disabilities on quality of life.'' The Institute of 
Medicine made the same recommendation in 2007, and such a system has 
been successfully implemented in other countries with comprehensive 
veterans benefits, including Canada and Australia. The true price paid 
by disabled veterans includes a loss in the quality of their lives, and 
we urge Congress to begin instituting a system that fairly compensates 
for this continuing cost of war.
    Third, Congress must ensure that existing veterans' benefits are 
paid accurately and on time in order to effectively fulfill their 
intended purpose. The ability of disabled veterans to care for 
themselves and their families often depends on the timely delivery of 
these benefits. But long waits and incorrect decisions by VA end up 
causing many disabled veterans and their families to suffer severe 
financial hardships; and these protracted delays can lead to further 
deprivation, bankruptcies, and even homelessness.
    The reality today is that too many veterans continue to wait too 
long for their claims to be resolved, and the results are too often 
wrong. The problem, put simply, is that the VA benefits claims 
processing system is broken and must be reformed.
    Although recent increases in staffing and funding were necessary to 
keep pace with a growing workload, it will take fundamental change to 
reform the claims processing system. VA needs to undergo a major 
cultural shift so that rather than focusing on production and cycle 
times, they concentrate on improving accuracy and quality. Instead of 
defining success as the elimination of the backlog, VA must realize 
that for veterans, success is having their claims done right the first 
time.
    Mr. Chairman, the Veterans Benefits Administration (VBA) today is 
at a critical juncture in reforming its claims process. In November, 
VBA will roll out their new Veterans Benefits Management System (VBMS) 
as a pilot program at the Providence Regional Office (RO). At the same 
time, they are continuing to experiment with process improvements with 
more than 50 pilots ongoing at ROs across the country. Over the next 
six months, it is imperative that Congress provide strong oversight and 
leadership to help guide VBA towards real and lasting reform. The VBMS 
must receive the full funding required over the next several years, and 
it must be developed so that quality control is built-in at every stage 
of production. Congress must aggressively oversee VBA's myriad of 
ongoing pilots and initiatives to ensure that ``best practices'' are 
adopted and integrated into a cohesive new claims process. Each pilot 
or initiative must be judged first and foremost by its ability to help 
VA get claims done right the first time.
    Fourth, we must fully support all families who have lost loved ones 
in service or who are caring for loved ones disabled in service. The 
true cost of war must include generous support for the widows and 
children of those who make the ultimate sacrifice in defense of our 
Nation. While nothing can restore their families, VA must ensure that 
survivor benefits are sufficient. One way Congress can help is by 
eliminating the offset of Survivor Benefit Plan (SBP) payments against 
Dependency and Indemnification Compensation (DIC) benefits to help 
these widows and their families.
    To assist family caregivers of disabled veterans, Congress approved 
the ``Caregivers and Veterans Omnibus Health Services Act of 2010'' 
(Public Law 111-163) earlier this year. This historic law authorizes 
comprehensive benefits and services for family caregivers of severely 
wounded and disabled veterans, and we thank this Committee for its role 
in moving that legislation. Unfortunately, due to budgetary concerns, 
the law provided direct financial support to a limited set of 
caregivers: those caring for veterans with the most severe disabilities 
and only for caregivers of veterans from the most recent conflicts. The 
true cost of war includes the cost of supporting caregivers of all 
severely disabled veterans from all wars and eras, and we call on 
Congress to continue expanding this benefit until all such needs are 
met.
    Fifth, we must ensure that disabled veterans receive high quality, 
comprehensive health care from a robust VA health care system; and that 
requires VA to have sufficient, timely and predictable funding. 
Congress made historic progress in health care funding reform last year 
with enactment of Public Law 111-81, the ``Veterans Health Care Budget 
Reform and Transparency Act,'' which authorizes Congress to provide 
one-year advance appropriations for VA health care programs. The law 
also requires VA to meet a number of financial and budgetary reporting 
requirements to assure the transparency necessary for Congress to make 
the new funding system work.
    While DAV and our allies in the Partnership for Health Care Budget 
Reform remain grateful for the broad, bipartisan support that made 
advance appropriations a reality, we are concerned that less than one 
year later Congress and VA appear to be falling short of the promise of 
the law. With the new fiscal year beginning tomorrow--and no Federal 
budget in sight--the fact that we have advance appropriations for VA's 
fiscal year (FY) 2011 medical care budget already in place demonstrates 
the importance and effectiveness of this new funding mechanism. However 
Congress' failure to approve the regular FY 2011 VA appropriations 
before adjournment also means that there is no FY 2012 advance 
appropriation approved for next year. Moreover, the likelihood of a 
long-term continuing resolution makes it unclear when or whether 
Congress will approve the FY 2012 advance appropriation at all.
    Furthermore, in a July 30 report required by Public Law 111-81, VA 
Secretary Shinseki stated that as a result of increased reliance on the 
VA health care system, as well as newly authorized caregiver programs, 
the level of funding contained in VA's FY 2011 advance appropriation 
was no longer projected to be sufficient. Yet, the Secretary did not 
request any additional funding, instead indicating that VA could 
reprogram existing funding from other ``lower-priority areas,'' which 
is exactly why the report was required in the first place: to identify 
supplemental needs that manifest subsequent to the approval of advance 
appropriations.
    Congress must ensure that the advance appropriations process, which 
was supported by virtually every member of the House and Senate on both 
sides of the aisle, is fully and faithfully implemented to assure 
sufficient, timely and predictable funding for VA health care. When VA 
reports that funding requirements have changed due to unforeseen 
circumstances, VA must request supplemental funding and Congress must 
provide such funding to fully meet their obligations to the veterans 
who rely on VA health care. The true cost of war includes the provision 
of comprehensive medical care to veterans, especially those disabled by 
their service, and that requires a fully-funded VA health care system.
    Finally, we must ensure that our Nation never backs away from its 
sacred obligation, as Lincoln put it so eloquently, ``. . . to care for 
him who shall have borne the battle, and for his widow and his orphan . 
. .,'' because of our government's inability to keep its fiscal house 
in order. While the Federal Government faces serious financial and 
budgetary challenges that must be addressed, any Nation that fails to 
meet its obligations to those who served, sacrificed and suffered is a 
country already morally bankrupt. As such, any recommendations that 
seek to balance the budget on the backs of disabled veterans, whether 
they come from the President's National Commission on Fiscal 
Responsibility and Reform, or from the Office of Management and Budget, 
or from any other source, must be rejected.
    For example, there are those who would restrict access to VA health 
care to only the most severely disabled veterans or those requiring 
specialized care, as a way to reduce the price of VA health care and 
thus reduce the budget deficit. However, moving veterans out of VA care 
will force many of them to utilize Medicare, Medicaid or other public 
options that actually cost the Federal Government more per capita than 
the same care provided through VA. Moreover, efforts to shrink the size 
of the VA health care system or reduce it to so-called ``core 
functions'' threaten both the quality of care and the viability of the 
system itself. The true cost of war includes the cost of medical care 
to treat the wounds and disabilities of those who served.
    Mr. Chairman, the true cost of defending our Nation, whether at war 
or in peace, includes the full cost to compensate and care for 
veterans, as well as to support their family caregivers and survivors. 
The Disabled American Veterans stands ready to work with this Committee 
and others in Congress to meet the sacred obligations to America's 
veterans, especially disabled veterans. That concludes my testimony and 
I will be happy to answer any questions the Committee may have.

                                 
                  Prepared Statement of Major General
                John Batiste, USA (Ret.), Rochester, NY
    As we observed the anniversary of September 11th, we all 
experienced very mixed emotions. On the one hand, we remember those 
whose lives were taken in the cowardly attacks on the World Trade 
Center, the Pentagon, and a field in Pennsylvania. As Americans, we 
continue to grieve with their families and loved ones. We are resolute 
and angry. We are incredibly proud of our troops and are grateful for 
their unimaginable sacrifices and selfless service. On the other hand, 
most of us do not feel any safer. The notion that the war in Iraq is 
over is disingenuous. There is no functional Iraqi government, the 
police force is corrupt and ineffective, the army is weak and focused 
on police missions, and the forces of sectarian violence are alive and 
well. The only thing that has changed in Iraq is the mission, but rest 
assured that our troops can and will transition back to combat at a 
moment's notice. We wonder where it is all going in Afghanistan and how 
the mission fits within a greater strategy. We have lost confidence in 
our elected leaders.
    Our Veterans answered the call to serve, but America is letting 
them down. Americans were never mobilized in support of our troops in 
Iraq and Afghanistan. Some speak about a ``Sea of Goodwill'' of 
American support, but the truth is that there is no unity of effort or 
synergy between Federal, State, local, and community efforts in support 
of Veterans and their families. From the perspective of the Veterans 
Administration (VA), this is a huge opportunity lost. As the chair of 
the New York State Veterans Affairs Commission, I can tell you that 
there is an enormous gap between resources and the needs of Veterans in 
these wars. The VA system is seemingly overwhelmed and work to 
synchronize Federal, State, local, and community efforts is in need of 
serious attention. The cost of today's wars is staggering. We have 
spent over a trillion dollars and that number will multiply as the cost 
to care for our wounded is tallied over the decades to come. Over 5,500 
Americans have given their last full measure in Iraq or Afghanistan and 
over 50,000 have been wounded. The number of Veterans suffering from 
traumatic brain injury and post traumatic stress disorder is in the 
hundreds of thousands. Far too much in support of our Veterans is 
simply not getting done. As I have said many times before, how we treat 
our Veterans defines our national character. How does it feel to 
receive a failing grade.
    There is a void between the VA Central Office, the range of VA 
medical centers and regional State offices, and local Veteran service 
organizations. Federal and State Governments are not aligned to serve 
Veterans and their families. I believe that the VA Central Office 
should lead by promoting community participation and involvement in its 
outreach efforts and developing competitive grant-based opportunities 
for community service providers specializing in Veteran services. As it 
has been suggested, it will take a ``Sea of Goodwill'' with Federal, 
State, local, and community efforts working in unison. The VA 
desperately needs community participation as an extension of its 
programs. To make this happen, leadership is needed to mobilize 
communities in support of VA objectives.
    From the State perspective, the New York State Division of Veterans 
Affairs is underfunded during a period of time when Veteran support 
requirements are exploding. The State is short the required county 
Veteran counselors and existing counselors lack training and 
certification. Some counties are doing a great job supporting their 
Veterans, but most are not. A major portion of the challenge is 
information sharing. A web-based portal for all of New York State would 
go a long ways towards informing our Veterans and reducing costs such 
as unused services, unsupported Veterans whose problems multiply in 
expense and complexity, and Veterans and their families who do not know 
about job, education, and career opportunities. Connecting all Federal, 
State, local, and private sector resources should be a top priority.
    In his address to the Nation on August 31st, 2010, President Obama 
rightly recognized that ``. . . one of the lessons of our effort in 
Iraq is that American influence around the world is not a function of 
military force alone. We must use all elements of our power--including 
our diplomacy, our economic strength, and the power of America's 
example--to secure our interests and stand by our allies.'' Sadly, the 
president is not walking the talk. Our government's decision-making 
process is not capable of developing a comprehensive national strategy 
to synchronize the elements of national power that the president 
described. The truth is that our government's interagency process is 
not capable of developing such a strategy. No one is in charge, there 
is no strategic planning process, and our government's 18 departments 
and agencies, to include the VA, are not unified with a common purpose. 
There is no teamwork with a bias for action. We do not have a 
government-wide strategy to deal with global terrorism or Islamic 
extremism, whatever we decide to call it. Without such a strategy, how 
can we put the sacrifice in Iraq and Afghanistan into context? How do 
Iraq and Afghanistan fit into the global context? How do we define 
success? How do we organize to better support our returning Veterans 
and their families?
    Many people I talk with confuse our defense strategy with a 
national strategy. Rest assured that our Department of Defense has a 
great planning process and routinely develops defense strategies and 
operational plans. The problem is that there is no overarching 
government-wide national strategy with all departments and agencies 
engaged, resourced, and committed to achieving a common goal. In Iraq 
and Afghanistan, the Department of Defense is carrying the lion's share 
of the load without the benefit of the entire team. This is a huge 
failure of both the Bush and Obama administrations. If you don't know 
where you are going, any road will get you there. Along the way, the 
military industrial complex, incompetent and corrupt elected 
representatives, and zealous officials in and out of uniform have taken 
us in the wrong direction. At the end of the day, our Veterans and 
their families suffer for this failure.
    I believe the root cause for our disconnected ventures in Iraq and 
Afghanistan, and our failure to properly care for our Veterans 
returning from war, is that America went to war in 2001 without a 
national strategy to deal with global terrorism with clearly defined 
ends, ways, and means. Indeed, such a strategy does not exist today. 
The president and elected representatives in Congress are expected and 
empowered to fix this. My recommendation is that Congress enact 
legislation to force upon our government's interagency process what the 
Goldwater Nichols Act did for the Department of Defense in 1986. 
Congress can force the interagency process to organize for success with 
clearly defined authorities, responsibilities, and a strategic planning 
process with trained planners in every department and agency. We expect 
and deserve a government that is capable of developing and executing 
serious strategic plans with a focus on teamwork and unity of effort. 
Short of this, we will continue to spin our wheels in responding to 
natural disasters, leaking oil wells, peak oil, controlling the 
integrity of our borders, properly attending to the needs of our 
Veterans and their families, and global terrorism. America can do 
better.
    Why are Americans indifferent today that we are a Nation at war? 
Why are we less safe today than we were on September 11th, 2001? Why 
are we failing our Veterans and their families? Why are we introducing 
legislation to create a Veterans Trust Fund nearly nine years after 
commitment of troops into these wars? Part of the answer is that our 
government's interagency process is broken. Part of the answer is that 
our Federal Government lacks the process and trained planners to 
develop a real national strategy.
    Thank God that America is resilient, but let's not confuse 
resiliency with purpose.

                                 
         Prepared Statement of Colonel James D. McDonough, Jr.,
      USA (Ret.), President and Chief Executive Officer, Veterans'
                    Outreach Center of Rochester, NY
    Chairman Filner and Members of the Committee, I would like to thank 
you for the opportunity to appear before you today to discuss the true 
cost of war and its impact on veterans and their families. The truth 
about caring for veterans and their families in this country is that 
for the vast majority, it's a ``luck of the draw'' proposition, 
determined largely by one's geographic location and proximity to 
advocacy and resources that defines success or failure as a veteran--
some will draw the ``card'' needed at precisely the right time and 
place; others will not. Some veterans will get help, other veterans 
will not. The best we hope for is to find an advocate who can help 
teach us what it means to become a veteran of our armed forces. I say 
this confidently after serving twenty-six years in the active Army, 
becoming a veteran and serving the past three years as Director of New 
York State's Division of Veterans' Affairs.
    The ``true cost of war'' in some part can be tracked by our 
country's willingness to consent to sending young men and women into 
battle--if willing to ``spend it all,'' citizens, through their elected 
representatives, provide their consent in return for the understanding 
that the Nation will be behind each and every warrior and their family 
as they head into battle. The Nation will provide for their every need 
if the circumstances demand because we ask so much of each of them. 
This construct is fundamental to the American warrior, but is it shared 
by all in this country?
    The ``Sea of Goodwill'' [i] referred to by Major General 
Batiste during this morning's testimony before Congress is a phrase 
used by some in the Pentagon to describe and characterize how America 
views its support toward our veterans and their families, including me 
and mine. Whether or not that phrase aptly captures the sentiment of 
America nine years into war in Afghanistan or seven years into war in 
Iraq, is largely a point I dare say many Americans have not paused to 
think of, let alone determined, given the state of national rhetoric 
underway regarding our fragile economy, health care reform measures and 
educational standing in this world.
---------------------------------------------------------------------------
    \[i]\ Sea of Goodwill. Matching the Donor to the Need, (A White 
Paper) Major John W. Copeland and Colonel David W. Sutherland, Office 
of the Chairman of the Joint Chiefs of Staff, Warrior and Family 
Support.
---------------------------------------------------------------------------
    As the leader of the nation's oldest non-profit for veterans and 
their families, I question such claims that a galvanizing effort is 
underway in this country behind its veterans and their families. From 
my perspective, our citizenry is indeed supportive of sending young 
Americans into battle--we have their consent to do so, but little to 
nothing is understood about their actual needs upon returning from 
battle and reintegration back into the very community from which they 
departed. One reason for this is that our country lacks a coherent 
national strategy to not only go to war, but to come home and care for 
those who fought these wars as well. And like all wars, they're easier 
to start than end, as we're seeing daily in Afghanistan, Iraq and back 
in America in every state where our veterans and their families return 
to get on with their lives.
    And while I believe that it's in our country's best interests to 
foster a ``Sea of Goodwill'' around caring for veterans and their 
families, only ``ponds'' and ``lakes'' currently exist in pockets 
across this country, unconnected by coordinating tributary, linking 
river or supporting stream. These separate and distinct efforts spring 
up daily but lack context, fit and perspective; often leaving veterans 
and their families only to receive a fraction of their earned benefits, 
access to health care and services to support their reintegration. 
There is no ``Sea'' in the ``Sea of Goodwill,'' only disjointed smaller 
bodies of water which serve a minority of our veterans and their 
families, and very poorly at that. So how do we improve upon that?
    We should start by leveraging community-based, private sector 
providers to better care for veterans and their families. At the end of 
the day, we want barrier-free access to services and our families 
included to address the aftermath of war.
    On any given day in America, only about 36 percent of returning 
veterans actually use VA services, leaving 64 percent of returning 
veterans--and their families--somewhere outside the VA's portfolio of 
services and benefits, and remember, these are benefits and services 
they've earned due to volunteer active service in the United States 
Armed Forces. So the first thing to reckon with in creating the 
conditions necessary for a ``Sea of Goodwill'' to exist across this 
country is that our system designed to care for veterans--the United 
States Department of Veterans Affairs (the ``VA'')--must be more 
inclusive to capture a majority vs. minority of veterans.
    To reach the 64 percent of returning veterans not using their 
services the VA must include community-based providers as part of a 
more coherent delivery network; private providers, supported by the VA 
and working alongside public providers, to deliver barrier-free and 
high quality veterans services, benefits and programs. The place to 
start is with our families since that's where the VA is not charged 
with any responsibility, outside its Veteran Centers. To think for a 
moment that you can somehow effectively ``treat'' the veteran absent 
his/her family, where residual damage and harm lingers, fails to 
understand one of the ``true costs . . . of these wars,'' namely that 
our families--spouses and children--have become casualties as well. 
Like other veteran families, my own is now different because of my 
service to my country, which is a dynamic unlike any other dynamic 
associated with fighting our Nation's previous wars. So to understand 
the ``true cost of war,'' the system in place to care for veterans and 
their families must work to account for and include all of us who have 
served, and our families. How this country supports a system of care 
for a minority of veterans--at the expense of the majority--is 
something we all need to understand in order to advocate for change.
    Vietnam was largely a young, single male experience. Afghanistan 
and Iraq is similar age-wise (young), but not exclusively the domain of 
single males anymore, for today women comprise between 15 and 17 
percent of the active armed forces. Add to this demographic the fact 
that many servicemembers are now married and with families of their 
own. So much that my Army talked of ``recruiting'' an individual 
soldier, but ``reenlisting'' a family, out of recognition that soldiers 
would serve again, despite the hardship endured, as long as they knew 
their family would be taken care--and they would be. But what happens 
when that family becomes the family of a veteran? Is the sense of 
caring the same? Unequivocally, I can tell you that the feeling of 
caring is not. When servicemembers and their families separate from 
service one of the first things experienced is a sense of isolation 
from their community. I see it nearly every day as families visit us at 
Veterans Outreach Center in downtown Rochester (New York).
    New York State remains the fifth most populous state in the country 
when it comes to its veteran population (and their families). Nearly 
one million veterans call New York State home. Almost 90,000 New 
Yorkers have served in Afghanistan, Iraq or both since September 11, 
2001. If you accept that 36 percent of all returning veterans are 
actually using VA services and these rates are actually emblematic of 
broader VA usage rates, in New York State there are roughly 640,000 
veterans accessing health care, benefits and services outside the 
system designed to support their needs. Add to this figure their 
families and you understand that most veterans are being cared for in a 
community setting. In our community-based counseling center at Veterans 
Outreach Center we see on average 53 new veterans and family members 
every month. Our housing services (emergency, transitional, supportive 
and independent) for homeless veterans operate at capacity (28 
``units'') every month; we have a waiting list just to get in and you 
can ``stay'' with us for up to two years if need be. 25 percent of our 
census is comprised of veterans who have served in Afghanistan, Iraq or 
both, which brings me to my second major point:
    The ``true cost of these wars'' must include the ``sunk cost'' of 
underwriting a troubled force
    A 350-page report issued in July after a 15-month investigation 
into the Army's rising suicide rate found that levels of illegal drug 
use and criminal activity have reached record highs, while the number 
of disciplinary actions and forced discharges were at record lows. The 
result, the Army found, is that ``drug and alcohol abuse is a 
significant health problem in the Army.'' [ii] Where the 
Army once rigidly enforced rules on drug use, it got sloppy in the rush 
to get soldiers ready for the battlefield. From 2001 to 2009, only 70 
percent of DUIs and 61 percent of positive drug tests were referred to 
the Army's substance abuse program, and drug testing became haphazard. 
In 2009, 78,517 soldiers went untested for illegal drugs. 
Statistically, the Army estimated that 1,311 offenders probably escaped 
detection. Where did they go? Said General Peter W. Chiarelli, Vice 
Chief of Staff of the Army, ``we've got kids that are going to have 
some behavioral health issues. The real hard part for us to determine, 
`OK, I am willing to help this kid, but how long can I help him?''
---------------------------------------------------------------------------
    \[ii]\ McClatchy Newspapers, ``As wars wind down, U.S. Army faces 
it problems,'' Greensboro, NC News & Record, Sunday, September 19, 
2010.
---------------------------------------------------------------------------
    These troubled ``kids'' have since separated and are now veterans 
and are back in every community in this country. As I stated a moment 
ago, they make up 25 percent of the homeless veterans we serve every 
day in upstate New York. How much of the ``Sea of Goodwill'' even 
understands this fact? We do because we see it every day; another 
``lake'' amongst other ``lakes,'' but certainly not within any ``Sea of 
Goodwill'' that America buys into when it provides Congress its consent 
to go to war.
    Lastly, I encourage Congress to stop spending scarce resources on 
brick & mortar VA facilities which continue to under-serve our veterans 
and their families. Like its sister department, the Department of 
Defense, the Department of Veterans Affairs maintains an aging 
infrastructure, some of which exists in locations no longer conducive 
to serving veterans. A BRAC-like process is needed to reform where and 
how the VA and its community partners deliver health care and services 
to veterans and their families. Geography plays a significant role in 
proximity to services in our state (like most others) and when you get 
there after your 1.5 hour drive from Victor to Batavia, New York, what 
do you see when you walk toward the lobby of the Batavia VA Medical 
Center? You're greeted by a sign that reads ``No Emergency Services,'' 
limited primary care capacity and only a small handful of actual 
services. Veterans and their families enter a lobby that is well-worn, 
devoid of younger veterans, and certainly absent of women veterans.
    If this is part of the ``Sea of Goodwill'' the Pentagon likes to 
speak of, where actually is the ``Goodwill?'' Why, if we are the 
greatest country in the world--the one that prides itself on reminding 
others it ``cares for those who served,''--do we continually pour good 
money down bad holes and experience the same sub-standard level of care 
we've come to almost expect as veterans? Has it become that bad, that 
our expectation as veterans is to be cared for poorly? Could a national 
strategy help? It certainly can't hurt, just as legislation to create a 
Veterans Trust Fund can't either. An up-front investment to be made 
prior to going to war serves to remind everyone that the true cost of 
war is calculated differently; that human factors--families, children, 
spouses, veterans--actually have real value and that their care must be 
accounted for to receive our nation's true consent to wage war. If 
America paused for only a moment to count the true cost it just might 
not like the price tag associated with their consent. As a veteran, and 
now someone who cares for veterans and their families in a community 
setting, perhaps the cost of obtaining the Nation's consent is the 
greatest cost to be calculated beforehand.
    Chairman Filner and Members of the Committee, I appreciate the 
opportunity to speak before you today. Thank you. This completes my 
statement. I am happy to answer any questions the Committee may have.

                                 
          Prepared Statement of Major General William L. Nash,
          USA (Ret.), Washington, DC (Independent Consultant)
    Thank you, Mr. Chairman. And thank you and the Committee on 
Veterans' Affairs for your work on behalf of the members of our Armed 
Forces and their families. Your work is crucial and I believe this 
hearing is most important. I would also like to thank Secretary of 
Veterans Affairs, Eric K. Shinseki for his wisdom, initiative and hard 
work on behalf of veterans and their families. General Shinseki is an 
old friend, and I could not be happier for the Nation in having him 
lead the Department of Veterans Affairs.
    When I was a fairly young commander in Germany in the early 80s, I 
worked for a commanding general who drew a clear distinction between 
``love of soldiers'' and ``care for soldiers.'' He used to say that 
everyone ``loved'' soldiers, but fewer knew how to take care of them. 
By that he meant, that not every commander had the necessary 
understanding of how the various Army systems worked in order to ensure 
that soldiers were equipped, trained, fed, compensated, and housed. 
Those efforts required expertise and resources and great energy to 
accomplish successfully. It was a lesson all commanders need to learn 
early in their careers.
    The same is true at the national level when talking about veterans. 
Yellow ribbons and bumper stickers are nice; so are standing ovations 
at ball games and 4th of July speeches. But they don't do the job of 
taking care of veterans and their families. For that you need expertise 
and resources and great energy.
    One important aspect of this endeavor is the need to anticipate 
requirements. As we have seen for many years and again this morning, 
the preparation for the wars in Afghanistan and Iraq were inadequate. 
Basically, we as a Nation failed to understand the consequences of our 
actions abroad or at home. Hence, we failed to prudently prepare for 
those consequences.
    Our soldiers, sailors, airmen and Marines sign an unlimited 
liability contract when they join the armed forces. The co-signers are 
their families. And we as a Nation, having chosen to have an all-
volunteer force, must underwrite these contracts to full value.
    Thus I am troubled as to the current state of preparedness to care 
for our veterans and their families. While significant progress has 
been made in many areas, there is much more to be done by both the 
executive and legislative branches of our government. We know that more 
than 450,000 veterans from Afghanistan and Iraq have submitted 
disability claims. More are coming; many more are to be expected. This 
is a long-term, life-time challenge.
    Mr. Chairman, you have recognized that there are ``more than one 
million claims and appeals jammed in a fatally-flawed system.'' As you 
have stated, the benefits claims processing system must be reformed. We 
must increase our capacity to handle the volume of applications as well 
improve the accuracy of initial claims decision. Drastic improvements 
are needed in the current appellate process. We must recognize and do 
something about the direct relationship between the shortages of 
behavioral health specialists and substance abuse counselors and the 
high suicide rates of veterans as well as the other ramifications of 
the dramatic numbers of post traumatic stress experienced by personnel 
returning from Afghanistan and Iraq.
    In other words, Mr. Chairman we need more expertise, more resources 
and even more energy. As to resources, I would add that a forced 
savings program--a Veterans' Trust Fund--seems to me to be a sound and 
prudent initiative to help meet long-term needs.
    It is the long-term that requires our attention. Care for our 
veterans and their families requires a broad perspective that goes well 
beyond the responsibilities of the Department of Veteran Affairs. Our 
citizens have determined that the Nation will be defended by 
volunteers, active and reserve, who serve because they have chosen to 
serve. And as I said before, that commitment is unlimited in scope. So 
as we look at veteran issues, we must examine the entire package of pay 
and benefits that we citizens are willing to spend in order to recruit, 
retain and reward the small group of soldiers, sailors, airmen and 
Marines that go in harms' way to defend our Nation. We have not done 
enough.
    I was privileged to serve for over thirty years with those 
dedicated public servants. I was also responsible at times to give the 
direct order to face battle and its horrible consequences. I never 
hesitated to look them in the eye as I gave those orders because I knew 
we were individually and collectively capable and dedicated. But I also 
knew that we were committed to caring for our dead and wounded--no 
soldier left behind. So must our Nation--we care for those who serve--
now and forever. Thus, Mr. Chairman, I look you in the eye and ask you 
and the Committee and the Congress to give to our veterans the very 
best expertise, resources and energy possible.
    Thank you.

                                 
                  Prepared Statement of Paul Sullivan,
             Executive Director, Veterans for Common Sense
    Veterans for Common Sense (VCS) thanks Committee Chairman Filner, 
Ranking Member Buyer, and Members of the House Veterans' Affairs 
Committee for inviting us to testify about ``The True Cost of War,'' 
and the consequences of the Iraq and Afghanistan conflicts. We are 
honored to be in the company of experts, advocates, and fellow veterans 
to discuss this important long-term issue.
    VCS begins by presenting the Committee with the most salient 
official government statistics about the human and social costs of the 
current conflicts. Our top priority for this hearing is to inform 
Congress, the press, and the American public about the human cost of 
the Iraq and Afghanistan wars because everyone in our country is 
impacted by high taxes, spending, and lost opportunity costs caused by 
war.
    As of March 2010, government statistics show 565,000 new veteran 
patients were treated at Department of Veterans Affairs (VA) hospitals 
and clinics since 2001. As of today, based on an average of 9,000 new 
patients each month, VCS estimates the current count of VA patients is 
approximately 619,000.
    The significant post-deployment statistics about our veterans must 
be contrasted with events during 2002, when the Administration had no 
casualty estimate, no plan to monitor or estimate fatal or non-fatal 
casualties, no plan for caring for non-fatal casualties, and no 
dedicated long-term funding for non-fatal casualties.
    The consequences of the war are high, especially for non-fatal 
casualties. There is a general lack of awareness about the hundreds of 
thousands of post-deployment casualties. And there appears to be a lack 
of urgency to adequately and promptly meet our veterans' growing needs. 
Therefore, VCS urges Congress to pass a new law mandating that the 
Administration must estimate, monitor, plan, and fund health care and 
disability benefits for our casualties before starting or entering into 
a war.
    VCS broadly defines casualty. This includes battlefield deaths, and 
caring for our grieving families. Casualty includes our servicemembers 
who become wounded, injured, or ill on the battlefield as well as 
during training. This includes post-war medical conditions among our 
veterans not immediately apparent while in the military, such as toxic 
exposures, traumatic brain injury, and mental health conditions.

Part One: Official Statistics

    Government statistics paint a disturbing picture of enormous human 
suffering among our servicemembers and veterans. VCS obtained the 
following facts from the Department of Defense (DoD) and VA using the 
Freedom of Information Act (FOIA).

    According to DoD:

          At the end of August 2010, a total of 5,670 U.S. 
        servicemembers died in the Iraq War and Afghanistan War combat 
        zones.
          At the end of August 2010, a total of 91,384 U.S. 
        servicemembers in the two war zones were wounded or were 
        medically evacuated due to injuries or illnesses that could not 
        be treated in the war zones.
          The grand total of U.S. battlefield casualties is 
        more than 97,000.

    According to VA:

          As of March 2010, VA treated and diagnosed 565,000 
        new, first-time Iraq War and Afghanistan War veteran patients. 
        Again, based on VA data trends, VCS conservatively estimates VA 
        has treated 619,000 patients as of today.
          VA's count excludes veterans who sought private care, 
        retired veterans treated by the military, and student veterans 
        treated at campus clinics. VA's count also excludes treatment 
        for wounded, injured, or ill civilian contractors.
          As of June 2010, VA received 513,000 disability 
        compensation and pension claims filed by our Iraq War and 
        Afghanistan War veterans.

    VCS Analysis:

          When VA and DoD reports are viewed side-by-side, VA 
        data reveals 100 new, first-time veteran patients for each 
        battlefield death reported by DoD.
          At the current rate of approximately 9,000 new 
        veteran patients and claims entering the VA medical and 
        benefits systems each month, VCS estimates a cumulative total 
        of one million patients and claims by the end of 2014.

    Missing Facts:

    In order for VA and DoD to properly manage the human and financial 
cost of providing medical care for our casualties, more robust data 
must be collected and analyzed immediately by the Administration, 
Congress, academics, and advocates.

          VA must be able to answer simple, straightforward 
        questions. For example, what is the total number of unique 
        deployed Iraq and Afghanistan war veterans who have received 
        any VA benefit (health care, disability, etc.) since returning 
        home? In another example, is VA able to accurately and 
        consistently provide the expenditures for all of these VA 
        programs? VCS remains alarmed VA is incapable and unwilling to 
        answer these two easy questions.
          DoD and VA must prepare an official accounting of the 
        financial costs for medical care, disability benefits, 
        education benefits, life insurance, home loan guaranty, and all 
        other DoD and VA benefits for servicemembers, veterans, and 
        families. For the past several years, VCS has requested this 
        information from VA using the Freedom of Information Act. VA 
        has not provided any cost data. Starting in 2001, VA employees 
        urged VA leaders to begin tracking war-related benefit use and 
        costs, and nearly all requests were refused.
          DoD must provide an accounting of all discharges by 
        type and branch of service, sorted by year, to monitor trends 
        for both deployed and non-deployed servicemembers since 1990. 
        Two prior hearings by this Committee documented tens of 
        thousands of improper discharges, often for veterans at high 
        risk of readjustment challenges due to TBI and PTSD. As the 
        number of less than fully honorable discharges increases, 
        additional highly vulnerable veterans flood into society. Many 
        of these veterans either don't seek VA assistance or are 
        refused VA help, instead turning to private, state, local, or 
        university campus programs for assistance that should have been 
        provided by the Federal government.
          VA should monitor negative post-deployment outcomes, 
        such as homelessness, suicides, divorce, and crime, as well as 
        state, local, and private expenditures on veterans. The most 
        important oversight remains the Administration's inability to 
        provide complete and accurate active duty, Reserve, National 
        Guard, and veteran suicide data. Every year DoD has set new, 
        and highly disturbing, records of active duty suicides. Most of 
        the initial monitoring began with FOIA requests from advocacy 
        organizations or journalists investigating patterns of 
        disturbing developments such as suicides, homicides, 
        unemployment, and homelessness. VA and DoD only began limited 
        monitoring and research after repeated advocacy organization, 
        media, and Congressional inquiries.
          The Department of Labor should monitor unemployment 
        and underemployment, both for veterans and families. Veterans 
        often move from the military installation to their home town 
        shortly after discharge. Often, these cross-country moves 
        uproot spouses from their jobs. The use of the Post-9/11 GI 
        Bill, legislation introduced by Senator Jim Webb of Virginia, 
        by hundreds of thousands of Iraq and Afghanistan war veterans 
        may be masking already alarming reports of high unemployment 
        among returning veterans.
          VA and DoD should monitor and report on the positive 
        post-combat, post-deployment, and post-military outcomes of our 
        veterans. For example, new businesses started by veterans, 
        higher wages earned by veterans, diplomas earned by veterans, 
        increased homeownership among veterans, and other signs of a 
        vibrant post-war adjustment to civilian life.
          VCS provides additional examples of the cost of war 
        at the end of our statement. The important statistics were 
        summarized by reporters in the article, ``The Numbers,'' 
        published last weekend by the Fayetteville Observer.

Part Two: Need for Trust Fund and National Plan

    VCS believes we must learn from the past so we do not repeat 
mistakes. VCS endorses the Vietnam Veterans of America, when they 
remind us that, ``Never again shall one generation of veterans abandon 
another.'' This is why Veterans for Common Sense fully endorses the 
proposal by Linda Bilmes and Joseph Stiglitz to create a Trust Fund to 
make sure our veterans receive the health care and benefits they 
earned.
    As a non-profit advocacy organization, VCS uses the Freedom of 
Information Act to obtain data from DoD and VA to monitor and publicize 
the needs of our veterans. VCS was honored to provide our data to Linda 
Bilmes and Joseph Stiglitz for their book, The Three Trillion Dollar 
War: The True Cost of the Iraq Conflict (2008). In their ground-
breaking work on the subject of the cost of war, Bilmes and Stiglitz 
called for the creation of ``A Veterans Benefit Trust Fund . . . so 
that veterans' health and disability entitlements are fully funded as 
obligations occur.'' In their book, the experts stated:

        There are always pressures to cut unfunded entitlements. So, 
        when new military recruits are hired, the money required to 
        fund future health care and disability benefits should be set 
        aside (``lockboxed'') in a new Veterans Benefit Trust Fund. We 
        require private employers to do this; we should require the 
        armed forces to do it as well. This would mean, of course, that 
        when we go to war, we have to set aside far large amounts for 
        future health care and disability costs, as these will 
        inevitably rise significantly during and after any conflict 
        (``Reform 12,'' page 200).

    The issue of establishing a Trust Fund is timely because we have 
now endured nine years of war in Afghanistan, and seven years of 
conflict in Iraq. In 1995, Congress was forced to intervene and 
appropriate $3 billion in emergency funding for VA. One of the main 
reasons cited by VA for the funding crisis was the unexpected and 
unanticipated flood of Iraq and Afghanistan war veterans. Thanks to the 
strong pro-veteran leadership of Senator Patty Murray, the daughter of 
a war veteran, VA was given additional resources to meet the tidal wave 
of new, first-time Iraq and Afghanistan war veteran patients flooding 
into VA.
    VCS remains a strong supporter of VA, and VA has made many 
improvements in personnel, budgeting, and policies in the past 20 
months. VCS wants VA to live up to the high standard set by President 
Abraham Lincoln: ``To care for him who shall have borne the battle and 
for his widow and his orphan.'' VCS encourages Congress, VA, and DoD to 
learn lessons from past mistakes. VCS urges Congress to mandate 
national monitoring and planning for the return of our servicemembers. 
A national plan must also include fully funding all needed health care 
and benefits for our veterans.
    Honoring and remembering our fallen, our wounded, our injured and 
ill, VCS quotes the eloquent poetry of Archibald MacLeish, a World War 
I veteran and former head of the Library of Congress. During World War 
II, MacLeish wrote:

         They say, We leave you our deaths: give them their meaning: 
        give them an end to the war and a true peace: give them a 
        victory that ends the war and a peace afterwards: give them 
        their meaning.

    As an organization of war veterans, Veterans for Common Sense is 
here today to give meaning to all of our nation's fallen, wounded, 
injured, and ill who deployed to Southwest Asia since 1990: Our Nation 
must learn the painful lessons from prior wars and take care of our 
veterans who enlist in our military to protect and defend our 
Constitution, even when the American public does not support the war.
    Gulf War combat veterans formed VCS in 2002. After our return from 
Iraq in 1991, we veterans learned President George H. W. Bush led our 
nation to war based on false pretenses. There was no formal declaration 
of war by Congress, only an ``authorization for the use of force.'' 
There was no threat to our Constitution or the safety of our Nation, as 
this first invasion of Iraq was a war of choice.
    The most painful lesson for Gulf War veterans has been the 
continuing lack of a national plan to care for our returning veterans, 
starting in 1991. The brutal irony today is the fact the Agent Orange 
Act of 1991 was enacted by Congress shortly after the Gulf War began, 
nearly 25 years after the Vietnam War began. On October 30, 2010, VA is 
set to finally begin, in earnest, providing additional health care and 
disability benefits to seriously ill Vietnam War veterans due to 
exposure to Agent Orange.
    We tried to learn a lesson from past government mistakes. On March 
10, 2003, as our Nation prepared to re-invade Iraq, VCS petitioned for 
calm and reason. As war veterans who actually served on Iraqi 
battlefields during 1991, VCS wrote a detailed letter to President 
George W. Bush co-signed by 1,000 veterans:

         Over the long-term, the 1991 Gulf War has had a lasting, 
        detrimental impact on the health of countless people in the 
        region, and on the health of American men and women who served 
        there. Twelve years after the conflict, over 164,000 American 
        Gulf War veterans are now considered disabled by the U.S. 
        Department of Veterans Affairs. That number increases daily . . 
        . Further, we believe the risks involved in going to war, under 
        the unclear and shifting circumstances that confront us today, 
        are far greater than those faced in 1991. Instead of a desert 
        war to liberate Kuwait, combat would likely involve protracted 
        siege warfare, chaotic street-to-street fighting in Baghdad, 
        and Iraqi civil conflict. If that occurs, we fear our own 
        nation and Iraq would both suffer casualties not witnessed 
        since Vietnam.

    We regret to inform you that the White House never answered our 
letter. President George W. Bush started his war of choice based on 
false pretenses. He ignored the wise and experienced counsel of the 
only group of living Americans who had ever fought in Iraq. Our 
veterans who raised serious, legitimate concerns about escalating the 
Gulf War with another invasion of Iraq were brushed aside in the rush 
to war.
    Earlier, on October 12, 2002, our VCS Executive Director, Charles 
Sheehan Miles, published an editorial criticizing the Congressional 
Budget Office (CBO) for failing to estimate the cost of caring for war 
and post-war casualties. The decorated Gulf War veteran wrote:

         In a surprisingly rosy cost estimate of something which can't 
        be accurately estimated, the Congressional Budget Office Monday 
        released an analysis of what Gulf War II might cost in real 
        dollars paid by U.S. taxpayers. Only they left out the most 
        important part: the casualties. The CBO estimate is naive and 
        unrealistic when you consider the kind of war we are preparing 
        to enter--an open-ended war of regime-change and occupation and 
        empire building that may involve heavy casualties in an urban 
        setting such as Baghdad. The CBO report is illuminating and 
        instructive for what it avoids. CBO uses the word ``assume'' 30 
        times, ``uncertain'' 8 times, ``unknown'' 4 times. Finally, 
        twice it says there is ``no basis'' for an estimate on key 
        items. In other words, it's a wild guess: kind of like taking 
        your broker's advice to buy Enron or WorldCom last summer. CBO 
        states up front: ``CBO has no basis for estimating the number 
        of casualties from the conflict,'' therefore, any discussion of 
        casualties was simply excluded.

    At the end of the day, robust monitoring, planning, implementation, 
and oversight are best for our returning veterans. VCS advocates pre- 
and post-deployment exams, as required by the 1997 Force Health 
Protection Act (PL 105-85) as well as hiring more DoD medical 
professionals to provide exams and treatment. VCS believes early 
evaluation and treatment are best because treatments are the most 
effective and often the least expensive. Recently published medical 
research conducted by Dr. Susan Frayne, of the VA Palo Alto Health Care 
System and Stanford University supports our VCS advocacy. Dr. Frayne 
told Businessweek on September 24, 2010:

         Looking to the future, the impetus for early intervention is 
        evident. If we recognize the excess burden of medical illness 
        in veterans with PTSD who have recently returned from active 
        service and we address their health care needs today, the 
        elderly veterans of tomorrow may enjoy better health and 
        quality of life.

Conclusion

    Why does Veterans for Common Sense care about the U.S. casualties 
from the Iraq and Afghanistan wars? Our founders are Gulf War veterans, 
and many Iraq War and Afghanistan War veterans are members. When we 
returned home, we encountered a DoD and VA medical system unable and 
unwilling to listen to our concerns about toxic exposures in Iraq and 
Kuwait in 1991. Based on our experience, in late 2002, we saw the 
handwriting on the wall: misleading information to start another war of 
choice. There were other disturbing signs: CBO, the White House, VA, 
and DoD had no post-deployment plan. As Gulf War combat veterans and 
advocates, we could see that in 2002 the George W. Bush Administration 
was going to repeat the miscalculation the George H. W. Bush 
Administration made in 1990 by failing to estimate or prepare for the 
true long-term costs of war. This unique hearing presents us with a 
rare opportunity to begin a dialog and plan for our long-term 
casualties.
    The statistics describing the damage to our Gulf War veterans are 
stunning in depth and scope. As of 2009, the widely respected and 
credible Institute of Medicine, part of the National Academy of 
Science, estimated as many as 250,000 Gulf War veterans remain ill 
after exposures to toxins while deployed to Southwest Asia during 
Desert Shield, Desert Storm, and Provide Comfort between 1990 and 1991. 
This research, mandated by the ``Persian Gulf Veterans Act of 1998,'' 
is confirmed by VA's Research Advisory Committee on Gulf War Veterans' 
Illness.
    Here are the two messages VCS sends to Congress, VA, DoD, and 
fellow Americans. First, as of today, VCS estimates our nation 
currently has as many as 619,000 Iraq and Afghanistan war veteran 
patients, plus a similar number of claims. VA can reasonably expect 
another half million new veteran patients from the two wars by the end 
of 2014, for a total of one million current war veteran patients and 
claims. This estimate is supported by the fact 44 percent of current 
Iraq and Afghanistan war veterans were already treated at VA. Based on 
2.2 million servicemembers deployed to the two war zones, that also 
equals one million patients. Second, our nation has no strategic plan 
to identify, monitor, treat, and compensate those veterans.
    In order to resolve this current problem, Veterans for Common Sense 
urges Congress to demand transparency from DoD and VA. Furthermore, VCS 
urges Congress to establish a Trust Fund, as proposed by Linda Bilmes 
and Joseph Stiglitz, so our Nation never again faces billion-dollar 
budget shortfalls at VA and national scandals such as Walter Reed.
    Again, we thank Chairman Filner and Ranking Member Buyer for your 
interest in this important issue. As a Gulf War veteran, I remain 
impressed with your advocacy for our veterans. We want our service to 
our Nation to have meaning. However, I remain deeply disappointed how, 
after 20 years of warfare in Iraq and neighboring countries, our 
Administration can't tell us, with accuracy, the full human and 
financial costs of the conflict. Even more troubling is the lack of 
monitoring, planning, and funding to provide care and benefits for we 
who have defended our Constitution. Please fix this now.

                                 * * *

News Articles Cited by VCS:

    The wars in Iraq and Afghanistan have taken a toll on soldiers that 
isn't readily visible. In a five-part series published on September 26, 
2010, in The Fayetteville Observer and on www.fayobserver.com, 
reporters Greg Barnes, Jennifer Calhoun and John Ramsey examine the 
mental health challenges facing Fort Bragg and how they will impact the 
military and civilian communities.

    ``The Numbers''--A look at some of the research into the mental 
health of soldiers and their families.

        A.  38 percent of Army soldiers and 31 percent of Marines 
        report symptoms of psychological problems. The figure rises to 
        49 percent for members of the National Guard. Source: 
        Department of Defense Task Force on Mental Health, June 2007.
        B.  Lengthy U.S. Army deployments increase the occurrence of 
        depression, anxiety, sleep disorders and other mental health 
        diagnoses for soldiers' wives left at home. Among women whose 
        husbands were deployed during the study period, 36.6 percent 
        had at least one mental health diagnosis. Source: Jan. 2010 
        study by RTI International, the University of North Carolina at 
        Chapel Hill and the Uniformed Services University of the Health 
        Sciences.
        C.  The overall rate of child abuse and neglect was more than 
        40 percent higher while a soldier-parent was deployed for a 
        combat tour than when he or she was home. Source: Study in 2007 
        by RTI International and the University of North Carolina at 
        Chapel Hill's School of Public Health. The study was funded by 
        the U.S. Army Medical Research and Materiel Command.
        D.  The overall rate of child abuse and neglect was more than 
        40 percent higher while a soldier-parent was deployed for a 
        combat tour than when he or she was home. Source: Study in 2009 
        led by Dr. Eric M. Flake of the Madigan Army Medical Center, 
        Tacoma, Wash.
        E.  Children of U.S. military troops sought outpatient mental 
        health care 2 million times last year, double the number at the 
        start of the Iraq war. The number of military children who were 
        hospitalized for mental health reasons also skyrocketed, from 
        35,000 to 55,000 during that time. Source: 2009 analysis of 
        internal Pentagon documents by The Associated Press.
        F.  Researchers found that 37 percent of Iraq and Afghanistan 
        war veterans who used the veterans health system for the first 
        time between April 1, 2002, and April 1, 2008, received a 
        mental health diagnoses. Of those, 22 percent were diagnosed 
        with PTSD, 17 percent with depression and 7 percent with 
        alcohol abuse. One-third of the people with mental health 
        diagnoses had three or more problems, the study found. The 
        study says fewer than 10 percent of the veterans diagnosed with 
        PTSD received the appropriate level of care at VA facilities. 
        Source: 2010 study by the San Francisco VA Medical Center and 
        University of California-San Francisco.
        G.  Stigma remains a critical barrier to accessing needed 
        psychological care. Analysis revealed that 20 percent to 50 
        percent of active duty servicemembers and Reservists reported 
        psychosocial problems, relationship problems, depression and 
        symptoms of stress reactions, but fewer than 40 percent sought 
        help for their problems. Source: Report of the Department of 
        Defense Task Force on Mental Health, June 2007.
        H.  ``The Task Force was not able to find any evidence of a 
        well-coordinated or well-disseminated approach to providing 
        behavioral health care to servicemembers and their families... 
        Another concern identified by the Task Force involves the care 
        provided to servicemembers as they transition from the Military 
        Health System to the VA system.'' Source: Report by the 
        American Psychological Association Presidential Task Force on 
        Military Deployment Services for Youth, Families and 
        Servicemember, 2007.

                                 * * *

    ``Veterans With PTSD Suffer More Physical Ailments Than Their 
Peers; Female vets with disorder plagued by more medical illnesses than 
male counterparts, study shows.''

    Published on September 24, 2010, by HealthDay News /Businessweek
    U.S. soldiers with post-traumatic stress syndrome (PTSD) returning 
from the wars in Iraq and Afghanistan suffer more physical ailments 
than those with no mental health issues, and this effect is stronger in 
women than men, a new study shows.
    The findings suggest that veterans with PTSD need closer 
integration of their physical and mental health care, said Dr. Susan 
Frayne, of the VA Palo Alto Health Care System and Stanford University. 
The study appears online in the Journal of General Internal Medicine.
    The researchers analyzed data from more than 90,000 U.S. veterans 
who used VA services and found that women with PTSD had a median of 
seven physical ailments, compared with a median of 4.5 among those with 
no mental health issues. Lower spine disorders, headache and leg-
related joint disorders were the most common physical complaints.
    Among men, those with PTSD had a median of five physical ailments, 
compared with a median of four for those with no mental health 
concerns. Lower spine disorders, leg-related joint disorders, and 
hearing problems were the most common physical conditions.
    ``Health delivery systems serving our veterans with post-traumatic 
stress disorder should align clinical services with their medical care 
needs, especially for common diagnoses like painful musculoskeletal 
conditions,'' Frayne said in a journal news release. ``Looking to the 
future, the impetus for early intervention is evident. If we recognize 
the excess burden of medical illness in veterans with PTSD who have 
recently returned from active service and we address their health care 
needs today, the elderly veterans of tomorrow may enjoy better health 
and quality of life,'' she concluded.

                                 
               Prepared Statement of Lorrie Knight-Major,
                 Silver Spring, MD (Mother of Veteran)
    Good morning Chairman Bob Filner, Ranking Member Steve Buyer, and 
Members of the Committee. Thank you for the opportunity to share my 
personal experience with the Military and the Department of Veterans 
Affairs. The following details my family's experiences with Ryan's 
journey and the significant role that the nonprofit communities played 
in helping my injured soldier regain his independence.
    My name is Lorrie Knight-Major. I am the mother of Sergeant Ryan 
Christian Major. On November 5, 2003, Ryan enlisted in the U.S. Army 
for a three year term, which was later extended for an additional five 
months. On November 10, 2006 at 0300, five days after his original 
discharge date and two months prior to his redeployment from Iraq to 
the U.S., Ryan was critically wounded as a result of an improvised 
explosive device (IED) blast while on a mission with his unit on a foot 
patrol in Ramadi. The device was hidden under ground. As a result of 
the blast, Ryan sustained multiple massive injuries including:

          Both legs were amputated above the knee;
          Both arms were broken with multiple fractures;
          Extensive peritoneum injuries;
          Severe right pelvic fracture; and
          Traumatic Brain Injury and post traumatic stress 
        disorder

    As I recall the events following the blast as a mother and a 
caregiver, I am reminded of the pledge that soldiers take when they 
enlist, the Soldier's Creed. I ask that each one of you listen closely 
and reflect on America's solemn oath to providing the necessary 
resources to our military.

         A Soldier's Creed

         I am an American Soldier. I am a Warrior and a member of a 
        team.
         I serve the people of the United States, and live the Army 
        Values.
         I will always place the mission first. I will never accept 
        defeat.
         I will never quit. I will never leave a fallen comrade.
         I am disciplined, physically and mentally tough, trained and 
        proficient in my warrior tasks and drills.
         I always maintain my arms, my equipment and myself.
         I am an expert and I am a professional.
         I stand ready to deploy, engage, and destroy, the enemies of 
        the United States of America in close combat.
         I am a guardian of freedom and the American way of life.
         I am an American Soldier.

    I met Ryan at his bedside in the intensive care unit in Landstuhl, 
Germany, three days after I had received the news. He was barely 
hanging on. I was frightened beyond description. But as bad as Ryan 
looked, I knew in my heart, he was a fighter. As a child, he had 
challenged every line I had drawn in the sand. Now I was certain that 
his determination would save his life. Although he lay there helpless, 
I believed that if given a fighting chance and the best possible 
medical care available, Ryan would persevere.
    Within 24 hours of our arrival in Landstuhl, doctors had stabilized 
Ryan for transport to Walter Reed Army Medical Center. Ryan underwent 
multiple surgeries while at Walter Reed. On January 3, 2007, Ryan was 
moved by ambulance to the R Adams Cowley Shock Trauma Center at the 
University of Maryland Medical Center (Shock Trauma). Shock Trauma is 
world renown for managing difficult traumas and complicated infections 
and is the only freestanding hospital center in the world dedicated to 
trauma.
    Within hours of Ryan's admission to Shock Trauma, the Pain Team was 
on board employing its unique holistic approach to treatment. The team 
used a host of tools including narcotics, Reiki therapy, massage 
therapy and, later, acupuncture. For the first time in three weeks, 
Ryan was able to sleep through the night peacefully, as the staff 
turned him every two hours.
    On January 31, 2007, Ryan was transferred to National 
Rehabilitation Hospital (NRH) where he spent the next seven months. But 
getting Ryan into NRH wasn't easy because he was an enlisted soldier. 
It took multiple meetings with military staff, but ultimately they 
granted permission. I convinced them that NRH had a proven track record 
and that Ryan's family and friends could routinely visit--support I 
felt would be critical to his successful recovery.
    Before going to NRH, we were given four options of VA polytrauma 
hospitals in the U.S., but none were close to home. Ryan's transfer to 
any of them would have required me to travel out of state and live for 
many months far from home, without social support and away from my job, 
while leaving my minor child at home. Our veterans should have access 
to Regional Trauma Hospitals and nationally recognized rehabilitation 
facilities that possess expertise on polytrauma that are located near 
their homes. Our family was very fortunate to live in the national 
capital region, home of two of the finest medical facilities, R Adams 
Cowley Shock Trauma Center at the University of Maryland Medical Center 
and National Rehabilitation Hospital. Most families I have met or 
talked to don't live in close proximity to hospitals such as these in 
their home towns. Most families of severely injured soldiers travel 
across state lines and live in hospital and hotel rooms to be near 
their injured soldiers for many months placing additional burdens on an 
already emotionally fraught time period.
    For the first two months after Ryan's injuries, we were not certain 
if he would survive. He was in a coma fighting for his life. He battled 
serious infections and underwent surgeries daily. Once we crossed those 
bridges and it appeared very likely that he would survive, I started to 
plan for his return home.
    Because of the wheelchair, I knew that major structural changes to 
our house were needed to accommodate him. Two separate architects 
examined our home and determined that a stair lift wasn't feasible. 
They both said that we needed an elevator. I didn't know how I would 
accomplish the huge task of making our home wheelchair accessible.
    Through the VA, there are three grants available for constructing 
an adapted home or modifying an existing home to meet veterans with 
service connected disabilities' adaptive needs: the Specially Adapted 
Housing Grant, The Special Home Adaptation Grant and the Home 
Improvements and Structural Alterations Grant (HISA), which require 
separate applications to the Veterans Health and Benefits 
Administrations. HISA does not require a service connected disability. 
To access the maximum funding through these grants, veterans have to 
own the homes where the modifications will be done. Up to half of the 
injured soldiers are single and they return home to live with their 
parents, other family members, or friends. Therefore, access to funding 
through the VA is limited to fourteen thousand dollars ($14,000.00) for 
work done on someone else's home where the veteran will live.
    In 2007, when I was looking for available housing resources, the 
grant provided fifty thousand dollars ($50,000). Now the grant provides 
sixty thousand dollars ($60,000). For the modifications that our home 
required, it wasn't enough money. The grant would have only paid for 
the elevator to be installed which would have carried him from the 
garage into the first floor of the house. But the bedrooms were located 
on the second floor.
    Fortunately, by word of mouth, I was informed about Rebuilding 
Together, a national non-profit organization that provides home 
rehabilitation and modification services to homeowners in need. In 
2005, Rebuilding Together launched its Veterans Housing Program to 
address the needs of soldiers returning from Iraq and Afghanistan. This 
program has been expanded to help veterans of all wars, and is now 
sponsored by Sears Holdings Corporation.
    Rebuilding Together's Veterans Housing Program to date has 
rehabilitated and modified the homes of 725 veterans and 25 veterans' 
centers. Their overall mission is homeownership preservation for those 
in need, and their 200 affiliates nationwide rehab 10,000 houses a 
year, at no cost to the homeowner, thanks to the work of thousands of 
skilled and unskilled volunteers and the support of national and local 
sponsors.
    Rebuilding Together immediately committed to the project upon 
receipt of my application. An evaluation of our house was performed. 
Their staff and architect met with Ryan's medical team at NRH to 
thoroughly assess Ryan's needs.
    The renovations were completed within four months. The work that 
was done by Rebuilding Together included: an elevator, the conversion 
of our first floor family room into Ryan's bedroom with an accessible 
bathroom, a new deck addition for his egress, a new separate central 
air and heating system for his bedroom, and an in-ground generator for 
emergency purposes and escape. The value of these renovations is 
estimated at $150,000 which, thanks to Rebuilding Together, didn't cost 
our family anything. This project was not just about installing an 
elevator or renovating the bathroom or adding a new deck. It was a life 
changing experience. Without the modifications, Ryan would have been 
confined to the basement--apart from his family or dependent on his 
brothers and friends to carry him up and down the stairs. The elevator 
and handicap accessibility renovations gave Ryan the freedom and the 
independence to move around his home and insured that he was an 
integral part of our home and our family.
    If these services had not been provided by Rebuilding Together, 
over 725 veterans and their family members would not have the quality 
of life they now enjoy since VA does not fully accommodate all of their 
needs through its grant programs. Sometimes that is because the veteran 
is unaware of the benefit, ineligible, or it's simply not enough as in 
our case. Ryan's dream to come home could not have been fulfilled 
without the generosity of many other members in our community.
    In 2008, Ryan received an IBOT wheelchair from the Independence 
Fund. This chair can climb stairs and rises in the air raising the seat 
height. Ryan's IBOT gives him the ability to reach upper kitchen 
cabinets in our home and allows him to visit friends where climbing 
stairs is necessary to enter their home. Independence Fund is a small 
nonprofit that was established in 2004. Independence Fund has donated 
twenty IBOTs to wounded soldiers and veterans totaling $500,000. Again, 
the VA did not have the ability to provide Ryan with this level of 
specialized equipment.
    In August 2009, Ryan received Theodore from Paws for Liberty. 
Theodore is a three year old Belgian Shepherd and has truly made the 
biggest impact on Ryan's independence. Theodore helps Ryan with 
retrieving dropped items, helps him navigate crowded areas, and helps 
relieve and mitigate his PTSD symptoms. Once Theodore came home with 
Ryan, Ryan no longer required someone at his bedside so that he could 
sleep. Paws for Liberty is a five year old organization based out of 
Lake Worth, Florida. They have donated four service dogs to veterans 
and six service dogs to individuals with disabilities. These dogs cost 
on average of $15,000-$20,000 to train. Again, a resource not offered 
to Ryan by the VA.
    I am reminded of the ancient African proverb, ``It takes a village 
to raise a child'' because, ``It takes a community to bring a soldier 
home''. Thanks to all of the support that we have received, Ryan is 
embracing his challenges, and is moving forward with his life. He has 
completed both the New York Marathon and the Boston Marathon on a hand 
crank bicycle, skied in Aspen, Colorado, kayaked on the Colorado River, 
and is driving his own car. He began attending college this semester 
pursuing a degree in Business Administration with the assistance of 
Sentinels of Freedom, a nonprofit organization.
    I have had to reach outside the system and rely on the nonprofit 
community for assistance throughout this ordeal. This support should 
have been provided by the government. It is because of the nonprofits 
that have provided Ryan with the resources for him to live at home with 
his family, take charge of his own care, and allow him to feel safe and 
sleep at night. In light of this, there should be better collaboration 
between the Department of Defense, VA and nonprofit organizations.
    Unlike many other soldiers transitioning out of the military, 
Ryan's transition into the VA system went smoothly. I credit this 
success to Ryan's Federal Recovery Coordinator. She laid the groundwork 
in planning Ryan's transition into the VA a year in advance by 
beginning the communication between Walter Reed and the Baltimore VA. 
Ryan's medical board process with the VA was a simple process. All of 
the VA staff that dealt with Ryan's medical board and disability rating 
provided outstanding services. I could not have asked for a more 
straightforward process. However, in hindsight, now that Ryan is 
enrolled in college, I wish that a vocational rehabilitation assessment 
was mandatory as part of his disability evaluation process before he 
separated from the Army. This would have provided vital information on 
his aptitude and functioning and would have informed his college course 
choices. He has still not had a VA Vocational Rehabilitation and 
Employment assessment.
    The one item that I feel has been overlooked in the VA Disability 
Rating is the disability's impact on a veteran's quality of life. And 
based on its impact, a corresponding dollar value should be assigned 
and paid to the veteran as part of the monthly disability compensation 
as a special monthly compensation.
    From the moment that Ryan was injured, his clothes required 
alterations due to surgeries, arm and hand splints, bilateral lower 
extremity amputations and the use of medical creams and ointment 
frequently soiled and ruined clothes. The clothing allowance available 
to veterans is not permitted under the law to active duty 
servicemembers with the same injuries or conditions. This benefit 
should be treated equally with the other benefits available to active 
duty wounded warriors, such as the auto and housing allowances.
    Our journey has been fraught with various obstacles that serve as 
barriers to access to quality care. Navigating the complex maze of 
treatment options and benefits is a job in and of itself. But, we 
remain determined that Ryan receives the quality care that he was 
promised when he enlisted to serve in the United States Army should he 
become injured. Advocating for this quality medical care and the 
coordination of services has been my mission. But this level of care 
and advocacy comes at a price. The cost has been my family's financial 
security. As a result of caring for my Ryan, and the emotional toll it 
has taken on our family, I had to leave my job to provide the necessary 
level of medical care and advocacy that my son required. This led to a 
significant financial hardship for our family because of my living on 
credit cards and a home equity line of credit, which have all been 
exhausted. When I gave up my job, I also gave up my health insurance 
that covered me and my minor child, shifting that additional monthly 
expenditure to my out of pocket expenses. Families should not have to 
sacrifice and bear the burden of advocacy, and compromise their own 
financial stability and wellness to ensure that their soldiers' receive 
the appropriate and necessary services from the government.
    I recognize that progress has been made in the caring of our 
injured soldiers. We still have a ways to go.

Recommendations in Moving Forward

    Here are the things that I would recommend to improve the lives of 
wounded warriors and veterans:

        1.  Increase the amount of VA Housing Grants and the 
        establishment of a competitive fund for national housing 
        organizations to compete for housing dollars to better enable 
        them to provide housing modifications for veterans.
        2.  VA Service Dogs are made available to veterans with service 
        connected disabilities to include challenges with mobility and 
        mental health issues as are done with Guide Dogs.
        3.  Increase in the VA Automobile Grant.
        4.  Increase in the number of authorized electric wheelchairs 
        based on changing needs and a program for veterans to return 
        wheelchairs that no longer meet their needs.
        5.  Vocational Rehabilitation Assessments are made mandatory 
        during the Disability Evaluation System process before a 
        veteran with service connected disabilities separates from the 
        military.
        6.  Authorize a clothing allowance that is available for 
        veterans to be available to servicemembers with similar 
        injuries and conditions.

    As a mother, here are the things that I would recommend that would 
have made my life easier if they were in place:

        1.  Health insurance allowance for my minor son and me; and
        2.  Non-medical attendant allowance that is provided by DoD to 
        caregivers of veterans that receive medical care greater than 
        fifty miles from their residence. Since I lived within the 
        fifty mile radius, I didn't qualify for the DoD benefit, but VA 
        could have filled the gap.

    As an observer with a window seat, here are my recommendations for 
the providers of care:

        1.  Improved communication between all of the providers 
        regardless if VA, DoD or private;
        2.  Better collaboration between all of the medical policy 
        leaders, both in the government and civilian population. Allow 
        private providers and facilities to fill in the gaps when a VA 
        facility is not in the veteran's community. Additionally, the 
        sharing of best practices between all medical providers would 
        improve the medical care provided to both the military and 
        civilian populations; and
        3.  Require a multidisciplinary medical team approach in 
        providing care in military and VA hospitals to include the Pain 
        Team and Infectious Disease specialty.

    Ryan loved being in the Army until the day he separated on May 20, 
2010. He loves the military. He never quit. He never once complained 
about getting hurt. The men in his Unit never quit. The medical teams 
that saved him in theater never quit. I ask this Congress to not only 
honor this country's solemn oath to care for our veterans, but I urge 
you to work towards the United States being proactive in making funding 
available for our wounded soldiers and veterans. If the United States 
can set aside funds for an unexpected oil spill, surely America can put 
aside monies at the time a war is authorized, to take care of our 
military that continues to take care of us preserving our freedoms. We 
owe a tremendous debt to our veterans for their services and 
sacrifices. It is our social, moral, and ethical responsibility to 
provide them with the appropriate resources, and the tools and support 
that are necessary for them to live longer, fuller, and healthier 
lives.
    Now that the Caregiver Bill has been signed by the President, I 
would like to know how it would address the concerns that I have shared 
on the record. Will the VA pay retroactive compensation to caregivers 
of OEF/OIF veterans? If so, will there be a lump sum payment to these 
caregivers?
    If the nonprofit organizations had not provided assistance, would 
it have been acceptable to the government for my son to have been 
placed in a nursing home? Would it have been acceptable to the 
government for my son to have lived isolated in a basement because he 
didn't have a means to be transported to the main areas of the house? 
Would it have been acceptable for my son to require sleep medications 
or someone in his room nightly for him to sleep? Is this what the 
government considers to be the cost of the war?
    Ryan couldn't be here today because he is attending classes. 
Therefore, I included a picture of him and his service dog, Theodore.
    Again, thank you Mr. Chairman for the opportunity to share my 
personal experience in accessing care and resources within the 
Department of Defense and the Department of Veterans Affairs.

[GRAPHIC] [TIFF OMITTED] 61761.001

    (Courtesy of b free daily)

                                 
     Prepared Statement of Corey Gibson, Terre Haute, IN (Veteran)
    Good Morning. My name is Corey Gibson and I am a combat veteran 
from the Operation Iraqi Freedom Campaign.
    I am here before you today as a collective voice for veterans 
nationwide. Where this may be my individualized account, the issues and 
concerns within my time with you are pervasive. You all trained me how 
to fight, how not to turn in the face of an enemy, and how to watch out 
for the better interest of my brothers and sisters in arms.
    Regardless of my daily struggles with PTSD, TBI, and other 
diagnosis, don't think that the training I received calls for me to 
stop fighting now.
    On September 23rd, Michelle Obama stated that veterans and spouses 
need support by local employers everywhere. I am sorry we can't get 
Stephen Colbert here to help highlight problems with veteran's health 
care and benefits. Could we send him into combat where he will be 
forced to make the decision of kill or be killed in defense of his 
country only to come back to a life of physical and mental disabilities 
so that we can have his input? A constant struggle affecting him daily 
for the rest of his life where life is never as he has known it before? 
He stated he likes to help people who don't have any power but are 
needed by the American people and I think that is exactly what many of 
us veterans feel that we are. Where is our celebrity?
    I was honorably discharged in October 2004 after being part of the 
initial surge into Iraq as a triage medic for the 555th Forward 
Surgical Team. I was exposed to things on a daily basis that will haunt 
my memories until my dying day. I am proud of the opportunity I had to 
defend my country but only those who went before me, after me, and 
stood beside me could possibly understand what that means.
    Truthfully, I should be a statistic, one of the many faceless 
veterans who are homeless or worse. I tried to integrate myself into 
the VA system because I wanted to try to utilize my benefits, but also 
to try to help create a positive re-integration process at my local VA 
for those who were bound to follow me. I had voiced complaints about 
back, neck, and shoulder issues that the Army did not investigate 
further. My complaints fell on deaf ears as it took me 6 years to get 
the MRI and have the spinal issues that I have documented in my 
records.
    I have had my personal information potentially leaked on a laptop 
that went missing from the VA and received an ``OOPS'' letter from the 
VA. I have been made aware after an endoscopy procedure that I may have 
to come back in for blood tests for Hepatitis C or HIV because of 
improper equipment sterilization within the VA. If any of these things 
happened in ANY other health care facility, I would be sitting here a 
wealthy man and there would be many out of jobs due to negligence.
    The rate of veterans committing suicide is astronomical. Statistics 
have shown that last year more than 125 veterans from the OIF/OEF 
conflicts committed suicide every week. We have lost more soldiers here 
at home than in country engaged in combat. Mental health services are 
paramount for our returning combatants. My interview upon returning 
from Iraq to decipher whether I needed mental health services or not 
was to be marched into a gym separated from my family by a piece of 
glass and asked if I wanted to see my family or do I feel I need to 
talk to someone about my feelings at this time.
    Within the VA system, an individual veteran's appeal for benefits 
can take up to 5 years. A re-evaluation after a rating has already been 
established comes every 3 years. Why is it that it seems the system is 
more proactive in taking things away from veterans than reaching those 
in need? It's not just the people who serve but it is the collateral 
damage destroying the lives of our loved ones who watch us struggle on 
a day-to-day basis and our inability to maintain relationships with 
those people because we have unaddressed issues.
    My fiance and I have discussed that if we had a child before we got 
married she would get more benefits toward her education than if she 
were JUST a spouse of a disabled veteran. Organizations such as 
Veterans of Modern Warfare, Vets 4 Vets, and The Coming Home Project 
are stepping up to fill the void of the VA shortcomings. Should they 
have to do this? On the tablet that Lady Liberty holds there is a 
sonnet and that sonnet ends with:

                    ``Give me your tired, your poor,
             Your huddled masses yearning to breathe free,
               The wretched refuse of your teeming shore.
             Send these, the homeless, tempest-tost to me,
                I lift my lamp beside the golden door!''

    Why is that we veterans are outside that golden door standing under 
overpasses begging for a few pieces of copper.
    I couldn't be prouder to call myself a veteran of the United States 
Military that joins me with a collective that's made up of some of the 
best our Nation has to offer. The ultimate fear for me and several of 
my veteran friends is that you have invited a veteran in to speak his 
compelling story and shine a light on the truth and it be dismissed. I 
am not here to simply complain but I am here to point out fallacies 
that are within the VA system, but it is ultimately up to you to take 
an action to fix this ongoing problem.
    I will end with this quick story. On my deployment in the heat of 
battle we took the most severely wounded as a life saving measure. One 
of those was a Marine who came to us with his entire leg from the hip 
down looking like hamburger. I remember his words to me as he pleaded 
``Doc, do whatever you have to do, tie a stick to it if you have to, 
but get me back into the fight because my guys need me.'' How dare we 
offer this population anything less than our best? So I ask you to 
please do something.
                                 
           Prepared Statement of Lieutenant Colonel Donna R.
            Van Derveer, USA (Ret.), Ashville, AL, (Veteran)
    Good morning Ladies and Gentlemen and Distinguished Committee 
Members. My name is LTC Donna R. Van Derveer, (Ret.), and I am 
originally from Washington, DC, but currently reside in Ashville, AL.
    I am honored to say I've served 29 years in the Army and Army 
Reserve as a Military Police Officer, and served my country with great 
pride and distinction. I served in Iraq as the Antiterrorism/Force 
Protection Chief for Multi-National Corps--Iraq from August 2004 
through January 2005. During my tour, I faced numerous rocket attacks 
and barely escaped with my life after a small arms round came through 
my trailer.
    Upon returning from Iraq, I experienced increasing issues with 
sleep disturbance, nightmares, depression, memory loss, irritation, 
anger, and an inability to concentrate and multi-task. I knew that I 
had a serious problem, but feared that my security clearance and career 
would be impacted, by seeking help. I did receive surgery on my right 
knee that I injured in Iraq.
    In 2006, I served as an Action Officer for J8-PAD, Joint Staff, 
Pentagon. During this tour, I eventually sought help through DSM. Even 
with counseling, I was unable to manage my stress and give 100 percent 
to my position. I requested Early Release from my tour.
    After delay and denial of medical treatment, abusive counseling 
sessions, being relieved of duty, suspension of my security clearance 
and a four-day stay in Ward 54 at WRAMC as a civilian in non-duty 
status, I finally received help. On September 27, 2007, I was put on 
MRP2 orders and attached to the Warrior Transition Brigade at Walter 
Reed.
    The 2 years and 4 months spent at Walter Reed was no less 
challenging than what I had already faced. The issue of improper 
diagnosis impacted my care. My psychiatrist placed an erroneous entry 
in my medical records, causing a delay of proper care for PTSD for over 
a year. This error impacted my Medical Evaluation Board/Physical 
Evaluation Board (MEB/PEB), thereby reflecting PTSD as ``Existed Prior 
to Service.'' I was forced to prove my service and incident that 
occurred in Iraq, since females are considered Non-Combatants even in a 
combat zone.
    The MEB/PEB process was excruciating for me. From my experience, I 
see the purpose of the DES Pilot Program is to expedite the process to 
save the Army money rather than provide for the soldiers disability 
compensation and wellbeing.
    I received 50 percent disability from the Army for PTSD and 90 
percent from the VA for PTSD and various other conditions. The Army 
determined that I overcame Presumption of Fitness for PTSD and nothing 
else, even though weeks earlier the PEB found that I should receive 80-
percent disability, and was forwarded for processing.
    As a veteran, receiving care through the VA, I have not seen a 
psychiatrist since I retired. I see a psychologist once a month versus 
seeing a caregiver at Walter Reed once or twice a week. In my eyes, 
this is minimal care. I was told that this is due to staffing. I was 
given the option to travel 65 miles one-way for additional behavioral 
health care. This is unrealistic for me as well as other veterans.
    The lack of behavioral health care should be of great concern. 
Those vets placed on the Temporary Disability Retirement List are 
required Re-evaluations. My initial re-eval was to be in July 2010. On 
September 7, 2010, I was informed that Fort Benning was backlogged due 
to the psychiatrist leaving, that my re-eval would be delayed for 
another 8 months. Putting veterans lives on hold and extending the 
transition process is unfair and unjust treatment.
    In summary, the transition process lacks concern for the soldier/
veteran from the individual unit through the MEB/PEB process to the 
care provided by the VA. Behavioral health care, proper diagnosis and 
need for more providers are significant issues for the Army, as well as 
the VA. The establishment of a Veterans Trust Fund to ensure these 
issues are not experienced by future generations of warriors due to 
fiscal constraints is imperative and should be a national priority.

                                 
                   Statement of Swords to Plowshares
    Thank you Chairman Filner, Congressman Buyer, and the members of 
the House Veterans Affairs Committee for the opportunity to submit 
testimony on this important topic; The True Cost of War: The U.S. 
Conflicts in Iraq and Afghanistan.
    Founded in 1974, Swords to Plowshares is a community-based not-for-
profit organization that provides counseling and case management, 
employment and training, housing and legal assistance to homeless and 
low-income veterans in the San Francisco Bay Area. We promote and 
protect the rights of veterans through advocacy, public education, and 
partnerships with local, state and national entities.
    The purpose of this testimony is to address the true and enduring 
costs of war as we see it from our perspective as community-based 
providers.
    The cost of war goes well beyond bullets and boots. The true cost 
of caring for our veterans must be considered prior to their return 
from war or separation from active duty. The federal government 
externalizes the cost of war to local and state entities, the 
community-based continuum of care, non-profit agencies, and to the 
veterans and their families. We write to extend our strong support for 
the Veteran Benefit Trust Fund which will guarantee funding for our 
aging veterans, our recently returned veterans and our future veterans.
    At Swords to Plowshares we have 35 years experience in picking up 
the pieces and pulling our Vietnam-era clients out of poverty, and 
chronic homelessness. We address mental health need and substance abuse 
stemming from their military service. We hope that we have learned 
lessons and may be proactive, prevent future homelessness and suffering 
by ensuring that this generation of combat veterans are afforded the 
honor, care and support they need for successful outcomes.
    Swords to Plowshares and similar agencies across the country cover 
operational costs through a mosaic of federal, state, local and private 
dollars. We are the recipients of federal funding in order to deliver 
care in the community. However, we are chronically underfunded and must 
again and again demonstrate the dire need for care ``on the ground'' in 
order to operate programs. Quite frankly, we and many other VSOs are at 
capacity, our staff is working miracles with limited resources to 
ensure that the veterans in our community receive the care they need. 
Federal resources are insufficient. The true cost of war must be 
subsidized by individual donors, foundations, and localities. At the 
same time, state and local coffers are shrinking while we on the ground 
respond to the flood of new veterans returning from war and an aging 
population of veterans.
    We are extremely appreciative of the support we receive through 
Department of Veterans Affairs and our partnership with the VA and 
their case managers, social workers and medical professionals in our 
community. We hope to ensure that the cost of this care is not 
reactive, but planned for well in advance so that each and every 
veteran have the access to health care, housing, employment 
opportunities and benefits they have earned in service.

                                 
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