The Daily Alaska empire., 1931-02-16
PAYING ADJUSTED COMPENSATION.

Immediate payment of the adjusted compensation certificates issued by the Government to World War veterans is receiving widespread discussion at present owing to the serious consideration given to it in the halls of Congress But amid all the talk, nothing very definite has presented itself that the citizen form his judgment on the proposi- ion.
 The clearest exposition has come from the United States Chamber of Commerce. In order to clarify the situation, it has briefly explained the principle of adjusted compensation and concisey summarized the several proposals for cashing them. In a com muncaton address to all member organizations, of which the local Chamber of Commerce is one, the National body depicted the whole subject as fol- lows:
 q The Adjusted Service Certificate Plan:
 After rejection of proposals for payment of cash bonuses to World War veterans, Congress passed in 1924 the Adjusted Compensation Act This law provided that adjusted compensation allowed to veterans according to period and place of service should be given in the form of adjusted service tificates which are in effect 20-year endowment insurance policies.
 ITO determine the face amount of the certifi- cate credit was given of $125 for overseas serv ice and S10O for home for each day of mili- tary duty in excess of 60 days. This credit is known the adjusted service credit. It was aug mented in each by 25 per cent and the result ing sum applied a single net premium in accordance with accepted actuarial principles with interest at per cent per annum compounded an- nuay to determine the face value of the certificate or endowment policy. Thus a of 25 years of age in 1925 with an adjusted service credit, aug mented by 9 per cent and totaling $550, received a certificate in the amount of S1,395, and if 30 years of age received certificate of sl388 The present-day reserve value of such a $1395 certifi- cate is s34913 and the maximum loan value at the present time is $3140o.
 Lump sum cash payments of S6O were made to every veteran for the first 60 days service. Where the adjusted service credit was $50 or less a full cash payment was made, there being, of course, no certificate issued
 Veterans permitted to make applications for adjusted service credit and certificates, until January ?, 1885
 "The holder of a certificate is entitled to re- ceive in cash it's full face value on maturity in 20 years, and in the event of his death prior to maturity of the certificate, the full face value is payable to the beneficiary he has named. After certificate has been outstanding 2 years the vet eran may negotiate loan, at limited interest with the certificate security. The loan may be made by banks or directly by the Veterans Bureau. In the event of the non-redemption of the certificate
 
 est of the loan are deductible and the balance is payable to the beneficiary Loans are limited in amount to 90 per cent of the reserve value of the certificates This reserve is the full reserve required by actuarial principles each certificate based on an annual level premium for 20 years computed with interest at per cent compounded annually
 "All but few hundred thousand veterans ap piled for adjusted service compensation. There accordingly now outstanding about 34ooooo adjusted service certificates with face value about $3425 100000 The average face value of the certificates is s1 00S the average loan value is $218, and the average loan that has been made by the Veterans Bureau the certificate is $lS1 About $10000O- GOO have been paid in death claims involving some 100000 certificates.
 "The law authorizes an appropriation for each year until 1946 of amount sufficient as an an nua premium to provide for the payment of the face value of each certificate 20 years from its date or on the prior death of veteran. This reserve fund to meet maturing certificates now amounts approximately to $770OO0OOo which is invested in United States Government securities Of course, to make this fund immediately available the securities would have to be marketed as would additional securities isued for the purpose of providing money.
 "H. Proposals in Bills Now Pending Before Congress:
 The bills pending in Congress that provide for immediate payment of some part all of the face value of the certificates fall into categories
 "(a) Payment of face value of certifcates-A number of the bills in the House and Senate provide for immediate payment of the full face value of the certificates-the amount payable at maturity or death according to the present law.
 official estimate of cost, s34oo,oOOoO0.
 "Cb) Payment of present-day value of certifi- cates-A number of the proposals provide for the