<P> On 30 June 1932 Neville Chamberlain announced that the Government would exercise its right to call in the 5% War Loan, offering a choice of taking cash or continuing the loan at 3.5% . Although they were obliged to give 90 days' notice of such a change, a 1% tax - free cash bonus was offered to holders who acted by 31 July . This conversion saved the government about £ 23 million net per year . On 3 December 2014 the UK Government announced it would redeem the outstanding war loans on 9 March 2015 . </P> <P> In 1917 and 1918, the United States government issued Liberty Bonds to raise money for its involvement in World War I. An aggressive campaign was created by Secretary of the Treasury William Gibbs McAdoo to popularize the bonds, grounded largely as patriotic appeals . The Treasury Department worked closely with the Committee on Public Information in developing Liberty Bond campaigns . The resulting propaganda messages often borrowed heavily from military colloquial speech . </P> <P> The government used famous artists to make posters, and used movie stars to host bond rallies . Al Jolson, Elsie Janis, Mary Pickford, Douglas Fairbanks and Charlie Chaplin were among the celebrities that made public appearances promoting the patriotic element of purchasing Liberty Bonds . Chaplin also made a short film, The Bond, at his own expense for the drive . Even the Boy Scouts and Girl Scouts sold bonds under the slogan "Every Scout to Save a Soldier". The campaign spurred community efforts across the country to sell the bonds and was a great success resulting in over-subscriptions to the second, third and fourth bond issues . According to the Massachusetts Historical Society, "Because the first World War cost the federal government more than $30 billion (by way of comparison, total federal expenditures in 1913 were only $970 million), these programs became vital as a way to raise funds ." </P> <P> Through the selling of Liberty Bonds, the government raised $21.5 billion for the war effort . The majority of sales were not to individuals but to banks and financial groups that ignored the patriotic appeal and bought the bonds principally as an investment opportunity . The bond campaigns themselves proved relatively ineffective at gaining widespread public support . The majority of Americans were simply uncomfortable converting a significant portion of their savings into what was, for them, a new and uncertain form of investment . The forceful sales atmosphere associated with the Liberty Bond campaigns ultimately produced disappointing sales figures . As such, the bond campaigns are remembered more for their associated level of coercion and bullying than its patriotic and voluntary nature . Secretary of the Treasury Henry Morgenthau, Jr. would face a balancing act between coercion and volunteerism in his bond campaigns during World War II . </P>

Why did the federal government encourage american citizens to buy war bonds