World War II was not the first time US Savings Bonds were issued. In fact, governments have borrowed money to fight wars as early as the Napoleonic Wars. Prior to World War I, governments would depend on small groups of wealthy financiers. The term ‘War Bond’ was first coined when the United States Congress funded the War of 1812. At this time, the bonds were not purchased through the general public.
World War I
US Savings Bonds during WWI, were first issued in 1917 and 1918. They were known as ‘liberty bonds’ and used to raise money for the United States involvement in the war. The United States, however, was not the only country issuing war bonds. Austria-Hungary, Canada, Germany and the United Kingdom also had forms of bonds to assist in funding their war efforts.
The US had posters made up to encourage citizens to support the war effort by purchasing the bonds. Celebrities also made public appearances in support of the war bonds. Boy Scouts and Girls Scouts also joined in the efforts. The United States was able to raise more than $21.5 billion through the selling of US Bonds. Most of the bonds were sold to larger financial groups and banks. The general public, for the most part, were skeptical to invest a large amount of their savings as this was a relatively new form of investment.
World War II
In the summer of 1940, the United States was beginning to plan for possible involvement in the war. Financing was a key concern. By the fall of that same year, Henry Morgenthau, Jr., who was the Secretary of the Treasury at the time, initiated a plan for a national defense bond program. He constructed a plan which consisted of three new series of bond notes: E, F and G. Series E was set up in increments affordable to individuals. They were known as ‘defense bonds’. This series started at a purchase price of $18.75 with a 10 year maturing rate of $25. Once the United States officially entered the war, the bonds became known as War Bonds. In all, more than 85 million Americans purchased war bonds raising more than $185 billion.
The Story of One Child’s Purchases
The story below is the story of one man who remembers his participation in purchasing war bonds during WWII. This story was reprinted with his permission. The photos provided are from the two bonds he did not cash in.
Children saved for $25.00 War Bonds by buying War Bond Savings Stamps and pasting them in a book until the required $18.75 amount had been accumulated. The stamps cost ten cents a stamp - a lot of money for a child in WW2.
When these bonds matured in 1952 and 1954 I refused to cash them because I thought they might have some historical value. I still have them and intend for them to go to my grandson, who at age 7 is a World War II aficionado. I selected one long form bond and one short form, and cashed the others to help with my children’s college expenses.
The purchase of the July 10, 1944 War Bond was a truly auspicious occasion for me. I was ten years old in July 1944 and lived in Quincy, Massachusetts, which was about four miles south of Boston. We went swimming in nearby Quincy Bay, which led to the North Atlantic. There was a War Bond Sales Event on July 10, 1944 and anyone buying a $25.00 War Bond could have a short ride in Quincy Bay in a DUKW, the same amphibious vehicle on display at the Armed Forces History Museum. I had just finished a book of War Bond Savings Stamps so I bought the War Bond and had a ride in the DUKW. In 1944 an amphibious vehicle was truly astounding, especially to a ten year old. I remember that ride as if it were yesterday.
I was a hustler even at that early age. During WW2 everyone saved their fat from cooking meats and exchanged it at a butcher shop for a small amount of money and what was really valuable – small pressed cardboard red ration coupons that could be used for purchasing meat, a very scarce commodity. I understand they extracted glycerin from the used fat and that was useful in making explosives. In those days there were no plastic covers or saran wrap to keep the fat from sloshing out on the way to the butcher shop. I had a little red wagon and every Saturday I would make the rounds of our neighbors and collect their messy cans of fat and bring them to the butcher shop, being careful not to spill any. My accounting skills were honed by that exercise as the housewives were very careful to be sure I did not mix up the load. The housewives wanted the red ration coupons and let me keep the money, which I used to buy Way Bond Savings Stamps. And that allowed me to get a ride on a DUKW.
Patriotism was at an all-time high during World War II. Everyone was involved in the war efforts one way or another. And while most people would associate the purchasing of World War II War Bonds with adults, this story shows how even young children during the war also had a sense of dedication and patriotism. For this child, the purchasing of World War II Savings Bond was a life changing experience he would forever remember.