Following World War I, the U.S. federal government anticipated that its war-risk insurance plan would adequately protect American soldiers and sailors who had served during the war, and that there would be no demand for compensation to those who had suffered no injury during their service in the army or navy. In 1924, however, Congress enacted a law, over the veto of President Calvin Coolidge, providing for a system of adjusted compensation based on length of service, with a distinction made in favor of service overseas. Under this plan, veterans entitled to receive $50 or less were to be paid in cash; those entitled to receive more than $50 were to receive certificates maturing in 20 years.
How much was the bonus?
Veterans up to the rank of major with at least 60 days service each received a dollar for each day of domestic service up to $500 and $1.25 for each day of overseas service up to $625. The bond that each received in 1924 (in lieu of cash) would accumulate compound interest, resulting in an average payment of about $1,000 for each veteran in 1945.
