On July 18, 1947, the United Nations established the Trust Territory of the Pacific Islands (TTPI) to be administered by the United States.  The TTPI was founded to help these small islands recover in the wake of World War II.

Along the southern border of the North Pacific Ocean, Micronesia is a subregion of the Oceania region that consists of thousands of small islands.  Within Micronesia are several separate nations including Palau, Guam, Kiribati, Nauru, the Northern Mariana Islands, the Federated States of Micronesia (not to be confused with the overall region of Micronesia), and the Marshall Islands.

Following the 1898 Spanish-American War, the US acquired several Spanish colonies, while some, such as Micronesia and Palau, were sold to Germany.  During World War I, Japan fought with the Allied Powers and captured several German possessions in the Pacific.  After the war, these islands were officially turned over to Japan.  However, Japan left the League of Nations in 1933 and began building air bases on the islands.  They defended many of their islands during World War II, but most were captured by American and Allied forces.

After World War II, many small island groups were left without a government, and did not have the resources to rule themselves.  On July 18, 1947, the United Nations established the Trust Territory of the Pacific Islands (TTPI).  Administered by the US government, the territory consisted of the Marshall Islands, the Northern Mariana Islands (except Guam), the Federated States of Micronesia, and the Palau Islands.

The TTPI territory was home to about 100,000 people spread out over three million miles of mostly water.  The territory was split into six districts of people from a variety of cultures that spoke nine different languages.  The large district centers had electricity and modern music, while the smaller islands maintained their traditions.

In the 1980s, the US and the Trust Territory developed the Compact of Free Association (COFA).  The goal was “to promote the development of the people of the Trust Territory toward self-government or independence as appropriate to the particular circumstances of the Trust Territory and its peoples and the freely expressed wishes of the peoples concerned.”

This compact was an agreement in which the US government agreed to help each of the included nations to develop their own self-governments and become independent as they saw fit.  However, the US would provide access to federal emergency management agencies as well as the National Weather Service, USPS, and the Federal Communications Commission, among others.  The compact was approved by Micronesia and the Marshall Islands in 1986.  The Northern Marianas instead chose to become a US commonwealth.

Palau attempted to become an independent state in free association with the US several times.  After eight separate referendum votes and a change to the Palau constitution, they ratified the Compact of Free Association and became independent in 1994.

Under the compact, the former trust territories received financial assistance for 15 years, with the US receiving full authority and responsibility for defense.  Citizens of these islands are permitted to live and work in the US and serve in the military.  In fact, the Federated States of Micronesia has one of the highest military enlistment rates, more than most states.

In 2003, the compacts with the Marshall Islands and Micronesia were renewed for 20 years, while financial aid for Palau is given through repeated Congressional resolutions.