On Tuesday in Baghdad, many businesses and government buildings were closed as the 83rd anniversary of the founding of the Iraqi Army was commemorated.
Security is always tight here, but on public holidays it is even tighter, and there were real fears the insurgents would use it as an excuse to launch an attack.
US soldiers in Iraq know they are a target
For the US soldiers here, it was not much different from any other day.
They know they are a target. They patrol the streets in full battle dress, rarely leaving their vehicles to mix with the local population.
In recent days, the attacks on coalition forces have increased again - up by a third in just a week - to around 22 each day across Iraq.
That means that most of the time they stay behind the walls of their heavily fortified bases, except when they are out on patrol.
So will the extra money the Pentagon is offering persuade some of the troops to sign up for three years more of the same?
"Morale right now is relatively high," says Captain Tyrone Simms of the 1st Squadron 2nd Armored Cavalry Regiment, "and the offer of extra money helps that."
Captain Simms' men had been told about the plans 24 hours earlier.
Extra cash may outweigh the risks for US soldiers
"I think some of them will stay on for more than three years," he says. "They'll look at the army and the job they're doing now and they'll say, 'Hey, I'm going to get paid a little more, I may as well stay in to make the money instead of getting out and taking the risk of trying to find a job'."
Lieutenant Scott Baber from the 1st Armoured Division, who was with an armed patrol in the street outside, agreed that the proposals would help to bolster morale.
"It's a good idea. It will help the army by increasing retention."
But would soldiers feel it was worth the risks they face here every day?
After all, more than 215 US soldiers have been killed since President Bush declared an end to hostilities on 1 May.
"I think they know the possibility of danger is part of the job," says Lieutenant Baber. "That will certainly be a factor in whether they take that incentive or not but certainly the incentive will make quite a difference to retention."
The ordinary soldiers in both patrols were not allowed to talk to the BBC on the record, but there seemed to be widespread agreement that the bonuses were a good motive for people to stay in rather than leave.
What was less popular was the announcement that those who were determined to retire or to leave the service may have to put their plans on hold until three months after they finish their tour of duty here in Iraq.
Several thousands of soldiers are likely to suffer from that change in the rules.
Their bosses, though, say there is no other option if they are to maintain the cohesion and the combat effectiveness of their operations here in Iraq.