Veterans Benefits

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VETERANS BENEFITS

Between 1890 and 1945, the United States modernized its system of veterans' benefits and expanded the rewards of military service. The culmination of these efforts was the landmark Servicemen's Readjustment Act of 1944, popularly known as the GI Bill of Rights. The GI Bill revolutionized how the nation provided for its returning soldiers. It also shifted government's obligation to veterans from provision of pensions to benefits that eased the return to civilian life, stimulated economic growth, promoted the expansion of the middle class, and helped to transform American higher education.

civil war through spanish american war

By 1890, the Civil War pension system had become a major source of political power and government entitlement. What had once been a program to provide for disabled veterans expanded into pensions for elderly veterans, their spouses and children, and widows. In 1902, nearly a million war veterans and their dependents received pensions at a cost of over $140 million, one-third of the national budget. The following year, President Theodore Roosevelt signed an executive order to expand war pension eligibility to cover old age. In 1912, Congress expanded pension eligibility once again.

Veterans of the Spanish American War followed suit in pressing for access to veterans' benefits. Over 300,000 soldiers had served in the war in Cuba and during the Philippine Insurrection. These veterans sought bonuses for their service and disability pensions for the nearly two thousand injured. Congress extended coverage of the general pension system of 1862 to disabled veterans of the war. In 1913, the two largest Spanish War veterans' organizations merged to create Veterans of Foreign Wars. That year, more than 29,000 of these veterans, widows, and dependents were on the pension rolls; in 1920, pension eligibility was extended to Spanish American War veterans over age sixty-two.

world war i

With the possibility of American entry into the First World War, critics of the military pension system did not want to extend "the pension racket" to a new cohort of veterans. With nearly five million soldiers in the wartime army, progressive reformers wanted to limit the economic and political consequences for the country. The cost of Civil War pensions was already over five billion dollars in 1917. Following this lead, Congress created a new program for the armed forces. Called War Risk Insurance, it was a voluntary and contributory insurance in which soldiers paid small premiums for life and disability coverage that could be transferred to civilian life.

While the war lasted, War Risk Insurance remained the major program for returning soldiers. By war's end, however, there were unforeseen problems facing veterans. There was little provision for the over 300,000 veterans needing medical care. In 1919, Congress passed a bill making the U. S. Public Health Service responsible for veterans with service-related injuries and diseases. This bill opened the twenty marine hospitals to returning servicemen and leased other hospital facilities from the army and navy, but it still was inadequate. In 1921, Congress passed the Langley Act, which authorized $18.6 million for the construction of new veterans' hospitals.

Peace brought with it high unemployment and new political pressures to aid veterans. In response, Congress granted returning soldiers a readjustment allowance of $60. It also passed the Sweet Act of 1921 to create the Veterans Bureau. The new bureau administered pensions and services for disabled veterans. The early years of the bureau were marked by the graft and corruption of its first director, Charles Forbes. The ensuing scandal left many veterans with an embittered view of the government's concern for its citizen-soldiers. The Bureau's new director, Brigadier General Frank T. Himes, greatly improved the hospitals, vocational training, and rehabilitation efforts.

The Veterans Bureau was only one aspect of the protracted campaign to expand benefits to World War I veterans. The Veterans of Foreign Wars, the American Legion, and the Disabled American Veterans proposed a program of "adjusted compensation," known as the Soldiers' Bonus, in 1919. The bill's sponsors argued that it was time to make good on the nation's obligations to those who served. After five years of debate, Congress passed the Soldiers' Adjusted Compensation Act over a presidential veto. Designed to compensate individual soldiers for income lost during their service, the bonus was issued in twenty-year insurance certificates payable in 1945.

From 1918 to 1941, the cost of benefits for World War I ex-servicemen, including disability, insurance allotments, and health care, equaled $14 billion dollars. In the 1920s, annual cost had escalated to $650 million a year, nearly 20 percent of the national budget. At the same time, veterans' organizations continued to lobby for early payment of the bonus. They used the massive unemployment of the 1930s to highlight the question of why the government postponed paying its debt of honor. Unemployed veterans joined the Bonus March of 1932 to solicit Congress's aid. Some saw this "Bonus Expeditionary Army" as a greedy special interest group; others protested that the government had an obligation to those who had served their country.

The coming of the New Deal might have silenced these demands. Government relief, public works, and other programs gave new resources and hope to the unemployed. The 1933 National Economy Act, however, cut veterans' pension payments and called for an investigation of the Veterans' Bureau. Outraged, Congressman John Rankin of Mississippi, joined by Wright Patman of Texas and others, sponsored legislation to restore existing pensions and grant early payment of the Bonus. Despite the administration's opposition, Congress paid the bonus in 1936 at a cost of $3.9 billion, nearly half that year's national budget.

world war ii: gi bill

The political struggle between New Dealers and the veterans' lobby was the context in which the most generous government program for veterans in United States emerged. Faced with another war, the Roosevelt administration preferred to address future veterans' needs within a broader plan for the postwar economy. Veterans' advocates in Congress, however, used wartime exigencies to shape a new program. The Selective Service and Training Act of 1940, the Veterans' Preference Act of 1944, and the Servicemen's Readjustment Act of 1944 established the priority of veterans' needs in the postwar world.

The centerpiece of the program was the GI Bill of Rights. Drafted by the American Legion, the bill guaranteed reemployment rights, life insurance, and musteringout pay. It also expanded the scope of veterans' benefits. World War II veterans received preference in employment; the opportunity for tuition, books, and living allowances for college or vocational school; and loans for homes, farms, and businesses. These programs constituted the largest package of veterans' benefits in American history. Between 1944 and 1949 alone, they cost American taxpayers over $12 billion dollars. World War I veterans often bitterly complained that they had been promised their jobs back on returning home. Veterans of the next generation were able to draw on the promise of the GI Bill of Rights to grant them unprecedented economic opportunities.

bibliography

Bennett, Michael J. When Dreams Came True: The GI Bill and the Making of Modern America. Washington, DC: Brasseys, 1996.

Boedinger, Robert George. "Soldiers' Bonuses: A History of Veterans Benefits in the United States, 1776–1967." Ph.D. diss., Pennsylvania State University, 1971.

Keene, Jennifer. Doughboys, the Great War, and the Remaking of America. Baltimore, MD: Johns Hopkins University Press, 2001.

Kelly, Patrick J. Creating a National Home: Building the Veterans' Welfare State, 1860–1900. Cambridge, MA: Harvard University Press, 1997.

Pencak, William. For God and Country: The American Legion, 1919–1941. Boston: Northeastern University Press, 1989.

Ross, Davis R. B. Preparing for Ulysses: Politics and Veterans During World War II. New York: Columbia University Press, 1969.

Skocpol, Theda. Protecting Soldiers and Mothers: The Political Origins of Social Policy in the United States. Cambridge, MA: Belknap Press of Harvard University Press, 1992.

Elizabeth Faue

Americans at War