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Obama Marks VA's 20th Anniversary

By Ed O'Keefe

President Obama marked the 20th anniversary of the Department of Veterans Affairs today, saying the coming year "will be the true test" of the department's mission to provide assistance to the nation's veterans, as many start returning from Iraq and Afghanistan.

"Until we reach a day that not a single veteran sleeps on our nation’s streets, our work remains unfinished," the president said during an address at VA headquarters, just blocks from the White House.

With Veterans Affairs Secretary Eric Shinseki by his side, Obama touted his administration's plans to serve an additional 500,000 veterans by 2013 by expanding access to VA health care facilities and providing additional care for mental health and injuries, "to ease the transition from active duty."

The Department of Veterans Affairs was elevated to Cabinet level on March 15, 1989, replacing the Veterans Administration, which was established in 1930.

At a ceremony marking its ascension, then President George H. W. Bush said "There is only one place for the veterans of America, in the Cabinet Room, at the table with the President of the United States of America."

"I couldn't agree more" with that statement, Obama said today.

When they debated the possible ascension in the late 1980s, many lawmakers considered the proposal a big pork barrel project.

"There were all sorts of efforts to keep the agency from bloating up, and it generally didn’t bloat at the beginning," said Paul C. Light, a New York University professor and expert on the federal bureaucracy who served as a staffer on the Senate Governmental Affairs Committee at the time. "It’s going to grow substantially in the coming years in terms of total employees, but for the most part it didn’t grow much after cabinet elevation, which is exactly contrary to the veterans’ groups. They wanted a bigger department with bigger influence."

The VA became the 14th Cabinet department with 245,000 employees and a budget of $30 billion per year. Today, it has more than 286,000 employees and a proposed 2010 budget of $55.9 billion.

A Washington Post report on the first day of VA's operation suggested the department faced immediate budgetary concerns and a decline in the nation's veteran population.

"Their number peaked at 28.6 million in 1980 and should continue to drop as aging World War II veterans, long the bulk of the agency's constituency, die," The Post reported at the time. It also faced a Congress reluctant to boost its funding.

"By the year 2010, we are going to have a lot of full cemeteries and a lot of empty hospital beds," Paralyzed Veterans of America executive director R. Jack Powell predicted at the time.

The opposite is true today, however. Congress mandated the construction of 12 new national cemeteries in 1999 and 2003; nine have opened with the remaining three set to open later this year, for a nationwide total of 131. VA operates 153 hospitals -- fewer than the 172 it had in 1989 -- but had 599,600 patient admissions in fiscal year 2008, according to VA spokeswoman Jo Schuda.

The president's speech at the VA marked his seventh visit to a Cabinet department. During his remarks, he acknowledged the impact of VA's mission by noting its personal impact: "My grandfather enlisted after Pearl Harbor and went on to march in Patton's Army. My grandmother worked on a bomber assembly line while he was gone. My mother was born at Fort Leavenworth while he was away. When my grandfather returned, he went to college on the G.I. Bill; bought his first home with a loan from the FHA; moved his family west, all the way to Hawaii, where he and my grandmother helped to raise me."

"So while the mission of this department is always vital, it is even more so during long and difficult conflicts like those that we're engaged in today. Because when the guns finally fall silent and the cameras are turned off and our troops return home, they deserve the same commitment from their government as my grandparents received."

Compare and Contrast

1989 2009
Staff Size 260,000 286,000
Budget $30 billion (Fiscal Year 1990) $55.9 billion (Proposed Fiscal Year 2010)
Current Director: Edward J. Derwinski Eric K. Shinseki
Number of Veterans Served: 27.2 million More than 23 million
Number of National Cemeteries: 112 128
Number of Hospitals: 172 153

SOURCE: Dept. of Veterans Affairs, Washington Post

By Bill McAllister
Washington Post Staff Writer
March 15, 1989 Page A1

Like most Washington monuments, the city's latest one is being erected late, well after the subject's influence has begun to wane.

It is the new Department of Veterans Affairs, a huge organization viewed by many in Congress as a pork barrel and charged with running the federal government's largest hospital system -- dispensing pills, paychecks and prosthetic devices to the nation's 27.2 million veterans.

Today it becomes the government's 14th Cabinet department, a seemingly impressive tribute to the political muscle of one of Washington's best-known "iron triangles."

For nearly six decades, the triangle of veterans organizations, the Veterans Administration and Congress' Veterans Affairs committees has nurtured and protected a system that boasts of offering "the most comprehensive system of assistance for veterans of any nation in the world." With a $30 billion budget, the new department should be assured of a comfortable role in the administration of a president who championed its formation.

Yet as the Veterans Administration prepares to assume its new status, the agency finds itself beset with three major problems.

For the short term, it is threatened from within by a domestic budget crisis that has forced the agency to begin denying thousands of veterans once-sacrosanct benefits.

It is also endangered by the first stages of what promises to be a precipitous decline in the nation's veteran population. Their number peaked at 28.6 million in 1980 and should continue to drop as aging World War II veterans, long the bulk of the agency's constituency, die.

And the new department remains shackled by the same web of congressionally mandated rules and regulations that left the old agency unable to change the jobs of as few as two workers at some facilities without Congress' approval.

The immediate crisis began years ago with the refusal of successive administrations to boost funding for the agency's 172 hospitals to keep pace with soaring health care costs. "By the year 2010, we are going to have a lot of full cemeteries and a lot of empty hospital beds," said R. Jack Powell, executive director of the Paralyzed Veterans of America.

Influence at Risk

No less a figure than Rep. G.V. (Sonny) Montgomery (D-Miss.), chairman of the House Veterans Affairs Committee and the most outspoken agency advocate on Capitol Hill, is openly pessimistic about the agency and veterans' organizations.

"If the Vietnam veteran doesn't get on board, doesn't join the great veterans organizations and sits back, we're going to lose what influence we have up here in the Congress," he said. "It's that simple. "We World War II boys, we're slowing down now and the Korean war boys are right behind us. So it's got to be done by the Vietnam veterans."

Until recently, however, many Vietnam-era veterans have stayed away from the agency and the big, congressionally chartered organizations -- the American Legion, Veterans of Foreign Wars and Disabled American Veterans -- whose 9 million members have been the backbone of the veterans' lobby. To keep their memberships up, the major groups have had to mount something unusual for them: aggressive membership campaigns.

"We were spoiled," said Mylio S. Kraja, the American Legion's chief Washington lobbyist, recalling happier times when no one questioned the costs of many post-World War II programs and most veterans eagerly joined home-town Legion posts after active duty.

On Capitol Hill, the job was simple, Kraja said: "You didn't have to do much if you told them that the veteran was suffering."

Today Congress remains, in Montgomery's words, "the veterans' best friend," pressing new programs on an agency that he charges has been more interested in cost savings than service. Under congressional prodding, the agency has launched programs to reach the many Vietnam-era veterans who, surveys show, distrust the agency. Vietnam veterans, according to the studies, remain wary of any government agency and especially one that has seemed hostile toward claims for Vietnam-related disorders such as post traumatic stress disorder and Agent Orange illnesses.

Although Montgomery was able to spare the agency from budget cuts that many domestic agencies endured during the Reagan years, the combination of new congressionally mandated benefits and automatic budget cuts forced by the Gramm-Rudman-Hollings deficit-reduction law have hit the agency in the only major area where administrators have budgetary latitude: its medical system.

Faced with congressional opposition to every recent plan to close entire hospitals, individual hospital administrators have instead closed wards and chipped away at benefits locally. Last year a congressional survey found that 13,000 agency hospital beds were vacant, many because of budgetary constraints. In Portland, Ore., 20,000 outpatient visits are being eliminated this year. Elsewhere, free prescription services and alcohol treatment programs are ending.

The hospitals account for about 38 percent of the $30 billion budget and most of the agency's 245,000 workers. Almost 60 percent of the budget goes into pensions for poor, elderly veterans or to compensate those injured on active duty. But these benefits are entitlements that the new department has little authority to regulate.

"There is no VA health care system," complained Powell of the Paralyzed Veterans group. "There are 172 fiefdoms and principalities out there."

President Bush last week acknowledged that he recognizes "the crying need for strong health care for the veterans," and agency officials said the administration is close to supporting a $324 million supplemental appropriation for the current fiscal year.

Also troublesome are long-range demographic trends. Not only is the agency faced with a graying population, the veterans are moving to where its hospitals are not. Thousands of what agency executives call "snowbirds" move each year to the Sun Belt, crowding hospitals and leaving many facilities in regions such as the Great Lakes less crowded.

Priorities in Dispute

Worried about the long-term outlook, the Disabled American Veterans recently began urging that more agency hospitals be consolidated with military hospitals, a step that Montgomery says may be "the only way we're going to save them." The American Legion, largest of the veterans groups, has announced that it will fight the move, contending that the two hospital systems have "different missions."

Whatever the hospitals' fate, conservatives argue that the nation's veterans are well served by the agency. "We do a helluva lot for veterans," said Sen. Alan K. Simpson (R-Wyo.), former head of the Senate veterans committee and one of the sharpest critics of the veterans lobby. "It is absurd to sit in this committee day after day, month after month, and think we don't do anything for the veterans of the United States of America," he said, citing the agency's $30 billion appropriation for 27.2 million veterans. "No other segment of our society receives that attention."

Simpson and others complain that there may be too many veterans programs, directed at the wrong people. Any military person injured in an off-duty accident can qualify for the same high-priority service-connected care given, for example, a soldier wounded by a mortar blast.

Only about one in nine veterans uses an agency hospital in any year, according to estimates. The care is free for any veteran who has an ailment connected to military service, is a former prisoner of war or is considered too poor to afford other health care. Because many of the agency's hospitals are affiliated with medical schools, the Veterans Administration long has boasted of excellent care.

Simpson argues that the combat-injured veteran deserves "whatever he needs," but that the agency's priorities are flawed and its recordkeeping cannot distinguish between the soldier injured on a battlefield and one hurt on a baseball field.

Others critics, principally in the Office of Management and Budget, have shared a fundamental dislike of the agency, questioning how long the government can afford to provide so many costly benefits to what is becoming a smaller percentage of the total population. The OMB view is much like that of The New England Journal of Medicine, which four years ago described the agency as "something of anomaly in a capitalist country, a tax-financed, centrally directed agency that reflects a brand of socialism with which many Americans are uncomfortable."

On Capitol Hill, the agency is viewed as undeniable pork. Liberals like its health care and welfare programs and conservatives see caring for veterans as the patriotic obligation of a grateful nation. All appreciate having agency payrolls in their districts and hospital administrators who willingly heed the requests of congressional caseworkers.

Having spent 24 years on the Hill as a representative from south Chicago, Edward J. Derwinski, the department's first secretary, knows that perspective well. As a House member, he used to handle hospital admission cases.

"It was not unusual for me to pick up a phone and call a VA administrator in a VA hospital in Chicago and say: 'I've got old Joe here from Post 4820 and he hasn't been able to get admission,' so I understand that," Derwinski said. "That's why I don't quarrel with that."

Despite the promises of increased influence that Cabinet status is supposed to bring, Derwinski cautions that his department is unlikely to be different from the Veterans Administration, its 59-year-old predecessor.

"I think the payoff will come slowly over a period of time," said Derwinski, 62, who spent the past six years as a little-noticed State Department appointee. He did not seek the Cabinet job, hoping instead for another foreign policy job, but now that he has it, he promises to "have a beer or two" at VFW halls and seek greater access to the president over budget issues than his predecessors did.

"I will have that access to the president and I will do the best I can to convince OMB that the new veterans department ought to be given some priorities," he said. "I don't know if I will win that one, but I certainly will try."

'Your Pelt Is Next'

Bush, who pressed President Ronald Reagan to endorse the Cabinet bill, is regarded as a friend of veterans, but Derwinski and his aides offer no illusion that the agency can escape the austerity that Bush says all agencies must share.

"I'm an inherent conservative by nature," said Derwinski. "I've never met a government entity that couldn't be a little leaner and a little more efficient. That doesn't mean I advocate arbitrarily slicing numbers or people or anything like that, but there always are efficiencies you are able to squeeze out of the system."

Derwinski's advisers expect that the secretary ultimately will find himself tarred by his old colleagues, who still want to dictate matters as minor as a level of service at every agency facility, and by lobbyists. "Your pelt is next," Simpson has warned Derwinski.

The agency has not closed a hospital since Lyndon B. Johnson was president, and the new secretary recognizes that internal studies long have suggested there is an urgent need for structural, cost-saving changes in the agency's hospitals, such as coverting more hospital beds into nursing home beds.

Derwinski said he hopes that a recent Defense Department commission, which recommended closing 86 military bases and partial closing of five others, may set a precedent that the agency can use "five or 10 years from now" to judge the effectiveness of its hospitals.

Evaluating Efficiency

If the hospitals, long the pride of the agency, are in disarray, the department's internal operations may not be much better. "These guys are living in the past," said Charles F. Bingham, a visiting professor of public administration at George Washington University.

Bingham, who last year reviewed the agency for the National Academy of Public Administration, ranks it in the bottom third of government agencies in terms of efficiency. "They are still writing 3-by-5-inch cards and manila file folders and this is the age of computers," Bingham said.

The National Academy study found the agency so hamstrung by rules and regulations that it recommended that Congress sweep away most of them before it considered elevating the agency to Cabinet status. The panel said it could find "little evidence" that elevating the agency would improve the lot of the nation's veterans and, in fact, might create the false illusion of improved service.

Congress, not surprisingly, refused to heed those suggestions. A number of members, including Senate Majority Leader George J. Mitchell (D-Maine), openly grumbled about suggestions that the agency needs to consolidate some of its 58 "regional" offices, mandated by law for every state.

That leaves Derwinski with a plate of longstanding and unresolved issues. How, for instance, can he justify the continued duplication in the agency's two major insurance offices, one in St. Paul, Minn., the other in Philadelphia? Both administer programs that internal studies have said could be run more effectively in one office. Members of Congress from Minnesota and Pennsylvania, however, have made clear they will fight any consolidation.

Another project long awaiting action is an update of the agency's benefits plan. Under tables that are largely unchanged since World War II, the agency provides financial help to individuals injured while in uniform. The schedule, however, bases benefits on a standard that assumes most people will need manufacturing skills, not the mental acuity that dominates the contemporary workplace.

Shortly after Bush nominated him, Derwinski made an unannounced visit to the veterans hospital in Martinsburg, W.Va., 65 miles west of Washington.

As he bounded out of his car and flashed an ID card identifying himself as the new secretary, Derwin- ski was surprised to find that the guard was unimpressed. The guard calmly picked up a telephone and called the administrator's office to announce that "someone from Central Office is here."

For Derwinski, one of his first missions is clear: Let the department know who that someone from the central office is.



HISTORY: Successor to the Veterans Administration, formed in 1930 to consolidate veterans programs administered by three separate agencies.

VA. "It works," says an agency spokesman, saying the new department will not attempt to create a new abbreviation such as DVA.

SIZE: 245,000 employees, the second largest work force in the federal government after the Defense Department.

BUDGET: $30 billion in fiscal 1990.

BENEFICIARIES: 27.2 million veterans.

FACILITIES: 172 hospitals, 231 outpatient clinics, 117 nursing home care units, 27 domiciliaries, 188 counseling centers for Vietnam veterans, 112 cemeteries, 58 regional benefit offices.

NONMEDICAL PROGRAMS: GI Bill for education (used by 20 million veterans), Home Loan Guaranty Program (used by 12 million), compensation and pension programs ($14 billion annually to poor, disabled and elderly veterans).

SOURCE: Veterans Administration

By Ed O'Keefe  | March 16, 2009; 4:30 PM ET
Categories:  Administration, Agencies and Departments  
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Wait wait wait. Obama bails out AIG, GM, etc... as they give out bonus after bonus.
However when he plans on expanding the workload of the VA he alows only a 2% raise
for the poor clowns doing the dirty work. This guy is a jerk off.

Posted by: teeballou | March 16, 2009 6:33 PM | Report abuse


If someone had told me in November that I would change the channel when Obama came on the tube, I would have probably told them they were racist in their attitude. I am so very weary of his excuses; his shifting blame; his sophomoric approach to our greatest ally; his inability to select the right people for critical positions; his seemingly endless personal desire for attention; and his apparent lack of ability to govern!

It blew me away when I heard what he wants to do to service connected (wounded) veterans. I seriously do not think he knows what he is doing, and neither do the folks around him. They are all scary!!

As a colleague of a different political persuasion mentioned two days ago, "How long will it take you to wish for the good old days of George Bush?" Sadly, it may not take very long!

Posted by: wheeljc | March 16, 2009 8:21 PM | Report abuse

Taking care of the troops:

The leader of the nation's largest veterans organization says he is "deeply disappointed and concerned" after a meeting with President Obama today to discuss a proposal to force private insurance companies to pay for the treatment of military veterans who have suffered service-connected disabilities and injuries. The Obama administration recently revealed a plan to require private insurance carriers to reimburse the Department of Veterans Affairs (VA) in such cases.

Posted by: Drumfire | March 16, 2009 8:25 PM | Report abuse

let's see..fewer hospitals..more cemetaries..and a budget that has not come anywhere near keeping up with vets sure are valued..

Posted by: w04equals666 | March 16, 2009 8:46 PM | Report abuse

The single best thing America can do for our Veterans Administration, is quit creating more veterans! It's that simple.

Second is, instead of building more individual VA facilities, merge them with state of the art hospitals and other medical facilities. Most of the vets going to the VA now, do not need military injury care. Their needs are about the same as everyone else's, and they could be well served in civilian medical care places just as well if not better than going to the VA, and it's likely that vets would not then have to wait month's for an appointment if this were the situation.

This situation is ripe for the taking in Colorado, where funding is available for a new Veterans Center. There are proposals on the table to partner the center with a new civilian medical facility. The government would be wise to take the opportunity.

Posted by: surfer-joe | March 16, 2009 10:15 PM | Report abuse

I think you forgot to report about one little aspect of today's meeting. Why am I not surprised??? This is almost unbelievable.

* * * * *

WASHINGTON, March 16 /PRNewswire-USNewswire/ -- The leader of the nation's largest veterans organization says he is "deeply disappointed and concerned" after a meeting with President Obama today to discuss a proposal to force private insurance companies to pay for the treatment of military veterans who have suffered service-connected disabilities and injuries. The Obama administration recently revealed a plan to require private insurance carriers to reimburse the Department of Veterans Affairs (VA) in such cases.

"It became apparent during our discussion today that the President intends to move forward with this unreasonable plan," said Commander David K. Rehbein of The American Legion. "He says he is looking to generate $540-million by this method, but refused to hear arguments about the moral and government-avowed obligations that would be compromised by it."

The Commander, clearly angered as he emerged from the session said, "This reimbursement plan would be inconsistent with the mandate ' to care for him who shall have borne the battle' given that the United States government sent members of the armed forces into harm's way, and not private insurance companies. I say again that The American Legion does not and will not support any plan that seeks to bill a veteran for treatment of a service connected disability at the very agency that was created to treat the unique need of America's veterans!"

Posted by: JackESpratt | March 17, 2009 12:06 AM | Report abuse

Hello America.....welcome to Obamaland. Do you Socialist and Marxist really think he was going to do anything for you. The Department of Veterans Affairs is a joke, has always been a joke.....any one with a brain would know that. With the recent AIG bonus money being reported, I remind the readers that just two years ago the VA rewarded its top executives with big bonus money, after they failed to submit accurate budget requests. The only people using the VA are the poor and needy. I would never take any one to a VA hospital for care....just read the VA's IG Reports and you would understand. This article is also wrong about the VA's budget....its much bigger, your only reporting the operating costs for the health care system. Remember when Derwinski was "choked" when he tried to use the empty beds for "medicare patients" folks just don't get.....

"To compel a man to subsidize with his taxes the propagation of ideas which He disbelieves and abhors is sinful and tyrannical."

"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered."
Thomas Jefferson

Posted by: jag136 | March 17, 2009 10:53 PM | Report abuse

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