Guest columnist Heidi Wastweet argues that the U.S. should stop making the one-dollar bill and move the one-dollar coin out of warehouses. It's an easy adjustment that could save as much as $5.5 billion over 30 years.
Today, numerous articles claim Americans don’t want to use the dollar coin in favor of the old dollar bill. There are more than $1.2 billion worth of dollar coins sitting uncirculated in huge vaults at enormous storage costs.
However, it is an error to think that because the golden coin doesn’t circulate well, that is evidence of American’s informed decision against it. We are simply not given a choice. I have never received a dollar coin in change at a store. Banks don’t even typically have them available at all. Once spent they go directly back to the Federal Bank, not back into circulation. Many citizens don’t even know they exist! I once gave a homeless man on the streets of Seattle a Sacagawea dollar coin and he didn’t recognize it. This is a guy whose existence depends on pocket change. Think about that.
Rep. David Schweikert, R-Ariz., chief sponsor of the legislation to stop the dollar bill cites the Government Accountability Office study that says taxpayers could save more than $5.5 billion over 30 years by retiring paper bills and replacing them with dollar coins. Among the legislation’s sponsors is Rep. Jeb Hensarling, R-Texas, co-chairman of the congressional “super committee” on deficit reduction.
On the other side, proposals to stop the dollar coin are all about protecting private industry, not the public interest. U.S. Sens. Scott Brown and John Kerry introduced the Currency Efficiency Act aimed at stopping the dollar coin. The Dollar Coin Alliance maintains the Massachusetts senators are protecting a business in their home state, Crane & Co., which supplies the paper used to produce dollar bills.
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If it were up to this kind of thinking, our country’s consumers would never have made the switch from film to digital photography in order to protect the private film and processing companies.
The one and only way to get those coins out of the warehouse and into circulation is to stop production of the dollar bill.
I recently asked an educated friend his opinion about the dollar coin, and his response was typical: “Seems like it would be more weight in my pockets.” I reminded him of his recent trip to Europe and asked him if he noticed his pockets were heavier or cumbersome due to the 1 euro coins? He said “No, I didn’t even think about it. I just naturally adjusted.” As would all Americans if given the chance.
We like to view our country as forward-thinking, yet all of Europe, Britain, Australia, New Zealand and even Canada already have realized the savings of using dollar coins for years now.
Estimates of U.S. savings range from $20 million to $500 million a year. Whatever the number, any savings would help as the federal government tries to rein in the crippling national deficit. In addition to the savings, let’s not forget the ecological impact as well. Billions of those easily worn-out dollar bills (which tend to jam up vending machines) are destined for the landfill every year. On the other hand, the long-lived dollar coin expected to last 30 years in circulation is 100 percent recyclable.
There is another piece of the puzzle: Look at the countries who switched to the coin. What do they have that we don’t? A two dollar coin. Think Loonies and Toonies, the two-Euro coin, the British two-Pound coin. Let’s start talking about that.
Cash still accounts for 40 percent of all financial transactions and will always be needed as long as there are garage sales, Craigslist, kids mowing lawns and the Tooth Fairy. Let’s get smart about it!
Heidi Wastweet is a Seattle sculptor and member of the Citizen’s Coinage Advisory Committee to the U.S. Mint.