At the close of the Revolutionary War, the United States government began administering a limited pension system to soldiers wounded during active military service or veterans and their widows pleading dire Poverty. It was not until the 1830's and the advent of universal suffrage for white male and patronage democracy, however, that military pensions became available to all veterans or their widows. Despite these initial expansions, the early U.S. military pension system was minuscule compared to what it became as a result of the Civil War.
Beginning in 1861, the U.S. government generously attended to the need of its soldiers and sailors or their dependents. Because the Federal government did not implement conscription until 1863, these first Civil War benefits in many ways were an attempt to induce men to volunteer. Although altered somewhat over the years, the 1862 statute remained the foundation of the Federal pension system until the 1890s. It stipulated that only those soldiers whose disability was "incurred as a direct consequence of . . . Military duty" or developed after combat "from causes which can be directly traced to injuries received or diseases contacted while in military service" could collect pension benefits. The amount of each pension depended upon the veteran's military rank and level of disability. Pensions given to widows, orphans, and other dependents of deceased soldiers were always figured at the rate of total disability according to the military rank of their deceased husband or father. By 1873 widows could also receive extra benefits for each dependent child in their care.
In 1890 the most notable revision in the Federal pension law occurred: the Dependent Pension Act. A result of the intense lobbying effort of the veterans' organization, the Grand Army of the Republic, this statute removed the link between pensions and service-related injuries, allowing any veteran who had served honorably to qualify for a pension if at some time he became disabled for manual labor. By 1906 old age alone became sufficient justification to receive a pension.
At the same time that pension requirements were becoming more liberal, several Southern congressmen attempted to open up the Federal system to Confederate veterans. Proponents justified such a move by noting that Southerners had contributed to Federal pensions through indirect taxes since the end of the war. These proposals met with mixed responses in both North and the South, but overwhelmingly, opposition came from those financially comfortable Confederate veterans and southern politicians who regarded such dependency on Federal assistance a dishonor t the Lost Cause. It should be noted that impoverished Southern veterans frequently were not averse to the prospect of receiving Federal pensions. In any event, no such law ever passed, and Confederate veterans and their widows never matriculated into the Federal pension system.
Although U.S. Civil War veterans had received pensions since 1862 and Southern state governments had provided their veterans with artificial limbs and veteran retirement homes since the end of the war, it was not until the 1880s and early 1890s that the elevens states of the former Confederacy enacted what can accurately be called pension systems. The economic devastation of he war and the political upheaval of Reconstruction best explain this long delay. When Southern pension systems did finally emerge, they generally resembled the pre-1890 U.S. system: eligibility depended upon service-related disability or death and indigence, and widows as well as other dependents of deceased soldiers could receive pensions. Despite these similarities, however, there were striking differences. First, in the South widows collected pensions set at a specific rate for widows of deceased soldiers. These rates were generally lower than those to which their husbands would have been entitled should they have survived. Under the Federal system, there was no separate category for widows. Second, most Southern pension laws determined stipend amounts based only on the degree of disability. No regard was given to military rank. Third, there was never a Confederate equivalent to the 1890 U.S. Dependent Act. Although over time Confederate pension requirements became more liberalized, there was always an income and poverty limit-pensions were never given simply for service. Fourth, whereas indirect taxes funded Federal pensions, most Southern states financed their pension through a direct tax. And fifth, because Southern pension systems were on the state level only, they varied as to method and amount and were much less financially generous than U.S. pensions. Though the individual pensions of Southerners were minuscule compared to those of Federal veterans and war widows, as a percentage of state expenditures, Southern pension expenditures were monumental. Of all the former Confederate states, Georgia generally spent the most per year on pensions, Alabama ran a close second.
Both the Federal government and Southern state governments continued to provide pensions for Civil War veterans and their widows well into the middle of the twentieth century. In all, billions of dollars were expended by both sides in an effort to "reward" the survivors of America's costliest war. Because of the high rates of expansion in both the Federal and Confederate systems, critics frequently accused pensioners and officials alike of corruption and fraud. Those pensioners most often labeled as frauds were widows, especially young women who had married veterans much older than themselves, supposed "cowards," and, in the Federal system, black veterans. By the mid-twentieth century, both systems were generally considered devoid of original integrity.
Source: "Encyclopedia of the American Civil War" edited by David S. Heidler and Jeanne T. Heidler, article by Jennifer L. Gross