Fiasco over death benefits is just latest in government's treatment of vets as second-class citizens

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This is a rush transcript from "On the Record," October 11, 2013. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Ryan Lamki's on temporary retirement from the U.S. Marine Corps. He is also an ambassador for the Armed Forces Foundation. He joins us.

Nice to see you, sir.

CORP. RYAN LAMKI, AMBASSADOR, ARMED FORCES FOUNDATION/RETIRED U.S. MARINE: Pleasure to see you, ma'am.

VAN SUSTEREN: What's going on with the vets? We've had the one problem where for nine days we didn't fund the death benefits for the families, and we also didn't pay for the families to travel to pick up the remains of their loved ones. What else is happening with the vets?

LAMKI: Well, if we're looking at a shutdown of all veterans benefits on 1, November, you're going face a major problem with individuals having financial stability. In some markets, you have upwards of 20 percent veterans unemployment. You have individuals who are so severely disabled that they're unable to work whatsoever. They need those veterans benefits just to make ends meet. It's not like they're making a huge savings account off those basic benefits. And so with the loss of income that comes from those basic compensation and pension benefits, you're going to have individuals who are hitting severe financial strain come November.

VAN SUSTEREN: As the secretary of Veterans Affairs, Shinseki, has actually testified to this, so he is not keeping this one hidden, this problem hidden, right? He has put it out there for people to see.

LAMKI: Yes, ma'am, he has.

VAN SUSTEREN: At least that's a good thing. One of the problems we had with the death gratuity is nobody told us about it.

LAMKI: That's very true. It is very well known, and veterans groups like the Armed Forces Foundation are stepping up and, one, getting their voice heard, but two, also stepping up to provide funding in direct assistance grants, the Bill and Beverly Young financial grants that are going to be assisting individuals who are incapable of paying their own bills come 1, November.

VAN SUSTEREN: All right. Even before November 1st, you have the situation where since the 1st of October there have been people furloughed who process claims, right?

LAMKI: Yes, ma'am.

(CROSSTALK)

VAN SUSTEREN: And there's been a consequence there.

LAMKI: On average since the furlough of all V.A. employees began about a week ago, you're facing about 1,400 claims not being processed per day.

VAN SUSTEREN: That's the slowdown.

LAMKI: That's already slowing gown and adding on to the backlog that already exists.

VAN SUSTEREN: If we're on October 10th, that's 14,000 behind where we ordinarily would be.

LAMKI: Yes, ma'am.

VAN SUSTEREN: Where we ordinarily would be?

LAMKI: Yes, ma'am.

VAN SUSTEREN: Before that, how were we doing on claims? Even before that we have a backlog to begin with, right?

LAMKI: The backlog was already almost insurmountable in the concept of getting up-to-date in any foreseeable future. Veterans in the most extreme cases are waiting up to two years to see their basic disability benefits being paid out.

VAN SUSTEREN: What are the veterans saying? You know, you all volunteered. And, you know, when we asked you to help, you were right there for us. Now when you come back, if you are injured -- and even you have a purple heart -- if you are injured, we say what? Later?

LAMKI: We'll get it to you when we can.

VAN SUSTEREN: What's your reaction -- I don't think the American people are too happy with that.

LAMKI: I can't imagine they are. And it evident in the support that they're giving to organizations like the Armed Forces Foundation that do provide that kind of financial assistance in that meantime. You know, organizations such as AFF are so capable of filling that gap. However, that gap should not exist in the first place.

VAN SUSTEREN: Is there a sense of bitterness or do you just feel like we abandoned you? I hate to generalize about all veterans. People with different experiences feel differently. But among some, do they feel abandoned?

LAMKI: In some extreme cases, I'm sure they do. Again, I can't speak for all veterans, but I'm sure there are many who do feel like the government has kind of turned their back.

VAN SUSTEREN: And this is even before the shutdown with all these backlogs in the claims.

LAMKI: Yes, ma'am.

VAN SUSTEREN: How does that happen?

LAMKI: Well, the large numbers of veterans claims are being processed. Most of them are coming in via paper. Some of them that are being submitted on-line still need to be vetted. It is a long process with veterans benefits where an individual has to go through medical evaluations through the Department of Veterans Affairs. The Veterans Benefits Administration then has to look through the V.A. schedule ratings for disabilities and determine that, yes, this individual does meet the qualifications for a specific percentage.

VAN SUSTEREN: Ryan, thank you, and I hope that changes. Thank you.

LAMKI: Thank you, ma'am.

VAN SUSTEREN: It took you, the American people, speaking out to get Congress and President Obama to restore death benefits to military families. Why did it come to that?

Representative Michele Bachmann joins us.

Nice to see you.

REP. MICHELE BACHMANN, R-MINN.: Nice to see you, Greta.

VAN SUSTEREN: October 1st was the shutdown, but it really did take the American people to raise holy hell that these death benefits weren't being paid.

BACHMANN: That's right. And we thought that it was all taken care of, and then we found out from the Obama administration, they said they had no legal authority to pay out the benefits. So we immediately put a bill on the floor. We were told it was going to be vetoed by Harry Reid. We couldn't believe it. But we put it on the floor anyway. We have passed veterans benefits in the House. We've also passed the specific death benefit guarantee as well because I think, in your last interview with Ryan, I think it's very key. People were extremely upset when we left our soldiers on the field in Benghazi. Now we're looking at leaving the remains of soldiers literally on the field overseas. We can't leave our disabled veterans without their benefits here in the homeland. That can't be done. That's why we've passed the legislation. It's got to be signed, and it has to be implemented.

VAN SUSTEREN: We're treating all the vets, even before October 1 as second-class citizens. They go, we'll get you later. Yet, when we ask them to help us to, you know, to go over and fight, they treat us like first-class citizens. They stepped up and did it. I mean, it's appalling to me the way we treat them.

BACHMANN: It's beautifully stated the way that you did it, that you said that we, the American people, are treated as first-class citizens and --

(CROSSTALK)

VAN SUSTEREN: By them. By them. By them.

BACHMANN: By the veterans.

VAN SUSTEREN: Yes.

BACHMANN: And we are treating them similarly situated. This is a problem we weren't familiar with. It's just horrific how old-fashioned the benefits system is in V.A. They still use paper to process these claims as opposed to putting it on-line, dealing with it digitally. This system --

(CROSSTALK)

VAN SUSTEREN: Yes, but fix it. Get it done.

BACHMANN: Exactly. Exactly.

VAN SUSTEREN: Everyone knows it's a problem, and it should be a priority. When we mobilize them because of some, you know, a 9/11 or something else, when we mobilize --

(CROSSTALK)

BACHMANN: Because of a threat. Because of a threat.

VAN SUSTEREN: Yeah. This is 9/11 for them.

BACHMANN: That's right.

VAN SUSTEREN: This is their whole lives. This is their whole --

BACHMANN: It's their lives.

VAN SUSTEREN: It's 9/11 for them, and we're just, like, later.

BACHMANN: That is what is unconscionable. That's why we pass the bill in the House on veterans benefits. We've passed the bill in the House on dealing with their actual remains, and also to help the families of these disabled veterans.

(CROSSTALK)

BACHMANN: Well, we --

(CROSSTALK)

BACHMANN: -- the fast track.

VAN SUSTEREN: But we also -- did they -- I mean, even before -- I mean, actually in some ways this is good for them because it puts the spotlight on the fact that even before the shutdown on October 1st, they had this incredible backlog of claims against the government and the government is not hearing them.

BACHMANN: Well, and that's why the suffering that the veterans have gone through, that suffering, I believe, is going to help subsequent benefits, because this is unconscionable. Now the American people are paying attention. They won't stand for us not being as giving and kind and generous as our veterans deserve.

VAN SUSTEREN: And, boy, my hat goes off to the American people who were so upset when they heard about the death benefits and the families not meeting the remains. They really did raise hell with emails and calls and everything else, and it got changed.

BACHMANN: It's not political. It's personal.

VAN SUSTEREN: And it's also the decent thing to do.

BACHMANN: And it's patriotic.

VAN SUSTEREN: That's right.

Congressman, always nice to see you.

BACHMANN: Thank you.