Congress looks at doing away with the $1 bill - analysis

Reproduced here for fair use and discussion purposes. My commentary interspersed in bold.

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By KEVIN FREKING

Associated Press WASHINGTON — American consumers have shown about as much appetite for the $1 coin as kids do their spinach. They may not know what’s best for them either. (Yeah, we don't know what's best for us. Thank Gawd we have such smart people in government who can tell us what we need and keep us from doing something stupid) Congressional auditors say doing away with dollar bills entirely and replacing them with dollar coins could save taxpayers some $4.4 billion over the next 30 years. (Uh, sure. Let's do the math. That's $14.7 million per year of PROMISED savings in a budget of $2.8 trillion. $14.7 million dollars runs the government for about 4 minutes. This is what the media is reduced to talking about for budget savings when we've had 4 straight years of deficits exceeding $1 trillion, a national debt of $17 trillion, and unfunded liabilities estimated at $106 trillion. But by all means, let's try yet again to convince Americans to use a coin they have shown they don't like.)
Vending machine operators have long championed the use of $1 coins because they don’t jam the machines, cutting down on repair costs and lost sales. (I'm sure the decision to make a move to $1 coins has to consider the desires of vending machine operators, hmm?) But most people don’t seem to like carrying them. In the past five years, the U.S. Mint has produced 2.4 billion Presidential $1 coins (Wow, 2.4 billion 1 dollar coins? And thy're just sitting around? This is certainly a good reason to mint yet another dollar coin, given such a successful track record). Most are stored by the Federal Reserve, and production was suspended about a year. The ago latest projection from the Government Accountability Office on the potential savings from switching to dollar coins entirely comes as lawmakers begin exploring new ways for the government to save money by changing the money itself (So lawmakers are just beginning to look for ways to save money? And this is the best they could come up with? Meanwhile the country goes down the tubes as it reels under the weight of financial mismanagement unprecedented in history).

The Mint is preparing a report for Congress showing how changes in the metal content of coins could save money. The last time the government made major metallurgical changes in U.S. coins was nearly 50 years ago when Congress directed the Mint to remove silver from dimes and quarters and to reduce its content in half dollar coins. Now, Congress is looking at new changes in response to rising prices for copper and nickel. (It used to be that coins had intrinsic value because of their precious metal content. Now they are like paper money, in that their value is represented only by what is printed (or stamped) on them. They only have value because people agree to exchange them for goods and services. If and when this confidence fails, this fiat currency will be valueless.)

At a House subcommittee hearing Thursday, the focus was on two approaches:

* Moving to less expensive combinations of metals like steel, aluminum and zinc.

* Gradually taking dollar bills out the economy and replacing them with coins. The GAO’s Lorelei St. James told the House Financial Services panel it would take several years for the benefits of switching from paper bills to dollar coins to catch up with the cost of making the change. Equipment would have to be bought or overhauled and more coins would have to be produced upfront to replace bills as they are taken out of circulation.

But over the years, the savings would begin to accrue, she said, largely because a $1 coin could stay in circulation for 30 years while paper bills have to be replaced every four or five years “We on continue average. to believe that replacing the note with a coin is likely to provide a financial benefit to the government,” said St. James, who added that such a change would work only if the note was completely eliminated and the public educated about the benefits of the switch ("...benefit to the government...". which of course is the bottom line. It doesn't matter if the people want it, it only matters what the benefit to government is. And if the people persist in their obstinance, the government will "educate" them about the benefits {to government} of the switch. This is the nature of of government that has long since moved outside its constitutional boundaries and now is able to engage in any sort of policy for its own benefit, no matter what the people want) .

Even the $1 coin’s most ardent supporters recognize that they haven’t been popular. Philip Diehl, former director of the Mint, said there was a huge demand for the Sacagawea dollar coin when production began in 2001, but as time wore on, people stayed with what they knew best.

“We’ve never bitten the bullet to remove the $1 bill as every other Western economy has done,” Diehl said. “If you did, it would have the same success the Canadians have had.” (This is a typical tactic. The US always seems to be the last Western nation that does this or has failed to do that. We are always portrayed as backward, slow to progress, or caught up in quaint, outmoded customs the rest of the civilized world has long since abandoned. Even lowly Canada is further evolved than are we.)

Beverly Lepine, chief operating officer of the Royal Canadian Mint, said her country loves its “Loonie,” the nickname for the $1 coin that includes an image of a loon on the back. The switch went over so well that the country also went to a $2 coin called the “Toonie.”

Rep. Bill Huizenga, R-Mich., affirmed that Canadians have embraced their dollar coins. “I don’t know anyone who would go back to the $1 and $2 bills,” he said (Here I though Michigan was a US state. Mr. Huizenga is happy to shill for the Canadians, even though Americans disagree.).

That sentiment was not shared by some of his fellow subcommittee members when it comes to the U.S. version (Here we finally discover that Huizenga is on the above-mentioned, but nameless, subcommittee. This is just bad writing,).

Rep. Lacy Clay, D-Mo., said men don’t like carrying a bunch of coins around in their pocket or in their suits. And Rep. Carolyn Maloney, D-N.Y., said the $1 coins have proved too hard to distinguish from quarters (We are nearly to the end of this report, and finally it is mentioned why Americans don't like these big coins).

“If the people don’t want it and they don’t want to use it,” she said, “why in the world are we even talking about changing it?” (Good question. and the answer is...)

“It’s really a matter of just getting used to it,” said Diehl, the former Mint director (Get used to it, America. You're going to get 1 dollar coins whether you want them or not. Get used to even more government forcing you to do things you don't want to do, because it's better for government. Meanwhile, as they fritter away their time trying to figure out how to persuade a too-stupid public what's best for them, the big matters of the day, the ones that require courage and leadership, well, those can wait.).