Coins could replace Dollar Bills.

[AnCap Dave]

Source

The super-committee charged with cutting trillions of dollars from the US debt by the end of the year may be able to find at least one relatively small-change solution in their wallets: replacing the dollar bill with the dollar coin.

The controversial move would phase out paper bills and replace them with a new $1 coin, increasing production costs at first but saving billions in the long term, USA Today reports. Groups on both sides of the issue are voicing their opinions, with the Americans for George claiming that we prefer the paper bill, while the Dollar Coin Alliance say saving money is preferable.

The Government Accountability Office, which issued a report on the cost-savings of a currency switch earlier this year, said that because coins outlast paper currency (which survive about 42 months), the switch would save about $5.6 billion over 30 years.

Lobbyists and industries with ties to the money-making industry are also weighing in. Massachusetts Sen. John Kerry has introduced a bill to do away with dollar coins (the current Susan B. Anthony versions). Paper for U.S. currency is made by Massachusetts-based Crane & Co.

On the flip side of the coin, mining interests and states that have heavy mining industries are pushing for the coins to become the standard. Former Arizona representative Jim Kolbe, who started campaigning for dollar coins in 1986, is now honorary chairman of the Dollar Coin Alliance and is pushing for the country to "update" its currency system, the report states.

One obstacle to the money-saving move, however, could come from Americans' dislike of using dollar coins, at least the ones now available. Currently, billions of dollar coins that are not used are sitting in storage facilities at the U.S. mint, according to a report by ABC News' Jonathan Karl.  By 2016 the dollar amount of coins in storage could grow to more than $2 billion.

To store all the unused coins, the Federal Reserve told Congress they will need to spend $650,000 to build a new vault in Dallas to hold them. Shipping the coins to the new secure facility will cost an additional $3 million.

Passed by Congress in 2005, the Presidential $1 Coin Act ordered the mint to make millions of coins to honor every dead president, but not even Sen. Jack Reed, D-R.I., one of the co-sponsors of the original bill, uses the legal tender.

"Do you use these things? Do you have any of these things in your pocket?" Reed was asked by ABC News' Jonathan Karl while holding the dollar coins. "I don't I tell you, but I like everyone else repeatedly use nickels, dimes, quarters. In fact I have a little jar in my car for the traffic meters."

I'm honestly not sure what I think of this. From the looks of things, it seems like coins would help us at least a little bit, but then again, the government would tell us a knife in the back is a great idea so I'm a bit skeptical on this as well.

What do you guys think? Good idea, bad idea? Will it actually accomplish anything? Would it have an effect on inflation for the better or for the worse?

[MrBogosity]

First of all, the current dollar coin is the Sacagawea dollar, not the Anthony dollar. Bad reporting.

This is the same controversy as the "round pound" in the early 1980s, but the Brits seem to have adjusted.

I think eliminating the penny would be much better. Think about it: in 1913, the year the Fed was founded, a penny was worth about 22 cents today--more than the penny, nickel, and dime! We got by fine without that small a fungibility; I don't see why we couldn't get by today.

[Ibrahim90]

personally, having grown up largely using them, I don't see a problem myself with this. of course, good luck selling the idea to the American people: I've already heard some arguments against the use of coin. I'll leave to you how to rebut these-they're that sad:

1-it's not as easy to make.
2-it's too hard to carry around.
3-not as pretty (no, I'm not making this up)
4-our economy has done well with paper money (yeah...)
5-it will hurt the feds and cause economic collapse

etc etc.

personally though, I would rather have the dollar in silver-like it is supposed to be. but I suppose this idea is a good start-though I'm not sure if it will really work.

[MrBogosity]

1-it's not as easy to make.

Offset by how long they last.

2-it's too hard to carry around.

Again, the Brits seem to be handling it well. And the pound is worth $1.60 right now! So it works for them for a LARGER amount of money!

3-not as pretty (no, I'm not making this up)

Have you SEEN the new $10 bill???

4-our economy has done well with paper money (yeah...)

The history of inflation shows this to be garbage.

5-it will hurt the feds and cause economic collapse

I'd LOVE to see the rationale for this one!

personally though, I would rather have the dollar in silver-like it is supposed to be. but I suppose this idea is a good start-though I'm not sure if it will really work.

Actually, you can--the Silver Eagle is marked $1, and it's one ounce of silver. Of course, it's worth about $33, now. There was a company that gave its employees the option of getting paid in Silver Eagles. So, if your salary were $33,000 a year, you'd get 1,000 silver eagles and exchange them for dollars, but your salary went down as $1,000, meaning you didn't have to pay Income Tax on them! The IRS sued them--and LOST!

3-not as pretty (no, I'm not making this up)
4-our economy has done well with paper money (yeah...)
5-it will hurt the feds and cause economic collapse

etc etc.

personally though, I would rather have the dollar in silver-like it is supposed to be. but I suppose this idea is a good start-though I'm not sure if it will really work.
[/quote]

[FSBlueApocalypse]

That IRS story is awesome! Link?

[MrBogosity]

I just did a Google search, and all of the links to news sources were 404'ed. It was talked about in a lot of forums, though.

[Ibrahim90]

yeah, those were my thoughts..  though I would argue that the fact that they're harder to make also makes it harder to inflate currency (you should see the Romans when they tried that stunt), and accordingly, harder to have government going on these ridiculous spending sprees. not the best argument, but that's my take personally.

and no, I couldn't figure out what people were playing at with the Feds and economic collapse either: people are just stupid that way I suppose.  I guess they were thinking that, since inflation is supposedly so good (lolwut), and the feds control this, then using coinage (which drops inflation ideally), would end inflation, which somehow, someway is supposed to cause poverty (yeah, I can't see what they're playing at), and hurt the feds (who maintain the inflation).

I didn't know though that you could be paid in silver dollars...gotta get me some of those if I can-before the market goes to hell.

you fellows heard about Obama's plan regarding student loans by and by?

[MrBogosity]

yeah, those were my thoughts..  though I would argue that the fact that they're harder to make also makes it harder to inflate currency (you should see the Romans when they tried that stunt), and accordingly, harder to have government going on these ridiculous spending sprees. not the best argument, but that's my take personally.

Nah, they just create the money electronically, in computers. Very little of the money in our economy is actual cash.

[Ibrahim90]

Nah, they just create the money electronically, in computers. Very little of the money in our economy is actual cash.

and they wonder why the inflation has been so high....

oh, wait, the Feds keep saying it is "only" ~2%.

[evensgrey]

Here in Canada we did that years ago.  In fact, we've long since replaced our $2 bills with coins as well.  (They're interesting, a bronze-colored central portion on each face and a steel-colored surround.  There was a few problems with them separating in the early days, but that's fixed.  There were also quite wrongly billed as the first 'bi-metallic' circulation coins.  They were the first bi-metallic circulation coins to have the connection on the coin face rather than the edge, but how long has the US been using those copper-nickle sandwich quarters?)

Canada's coinage is now in the following denominations: 1c, 5c, 10c, 25c, (multiple) 50c (I've only seen two, and they were different sizes), $1, and $2.  They keep talking about doing a 5$ coin, but that requires Parliament to amend our currency laws again to change the definition of 'legal tender'.  There's a limit to how much loose coinage counts.  No more than 25c in 1c coins, no more than $10 in other coins less than 1$ face value, and I think they made it no more than $25 in loonies (the $1 coin, has a picture of a loon on it in the default mintings) and toonies ($2 coins, the name that beat out 'dubloon' in popular usage).

[MrBogosity]

They used to have a law like that here, but they did away with it in the '60s.

People seem to have forgotten that we have $2 bills as well. Maybe a dollar coin will result in more $2 bills being used--which suits me fine, since it's Jefferson on the front!

[evensgrey]

Seems to me that a limitation in how many loose coins count as legal tender would contradict the basic principle in US currency law that if it was legal tender once, it's legal tender forevermore.  (In Canada, we've repudiated bank notes repeatedly when new designs are brought out, while in the US the notes are just pulled from circulation and I would hope the serial numbers are kept track of in terms of being officially put into and pulled out of circulation, otherwise what's the point of HAVING serial numbers on the notes?)

[Goaticus]

They used to have a law like that here, but they did away with it in the '60s.

People seem to have forgotten that we have $2 bills as well. Maybe a dollar coin will result in more $2 bills being used--which suits me fine, since it's Jefferson on the front!

In Ann Arbor near U.M.s campus there is a burger place called Blimpie Burgers that gives everybody $2 bills in their change.

[Virgil0211]

People seem to have forgotten that we have $2 bills as well. Maybe a dollar coin will result in more $2 bills being used--which suits me fine, since it's Jefferson on the front!

I remember my doctor giving me one of those when I had my tonsils taken out. I still have it in the dropleaf desk back at home. Those things seem to be pretty dang rare.

Nah, they just create the money electronically, in computers. Very little of the money in our economy is actual cash.

I've actually heard some argue that government debt denominated in domestic currency was preferable to foreign debt as the government, being the arbiter of that currency, would be able to print any extra money necessary to pay off the debt. Then again, I've recently read the book "This Time Is Different" which showed that domestic debt make much of a difference when it came to the risk of default or financial crisis.

[Ibrahim90]

I remember my doctor giving me one of those when I had my tonsils taken out. I still have it in the dropleaf desk back at home. Those things seem to be pretty dang rare.

I've actually heard some argue that government debt denominated in domestic currency was preferable to foreign debt as the government, being the arbiter of that currency, would be able to print any extra money necessary to pay off the debt. Then again, I've recently read the book "This Time Is Different" which showed that domestic debt make much of a difference when it came to the risk of default or financial crisis.

of course, having little to no debt is the best.

try convincing the federal government of that-of course.