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July 28, 2014

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Dollar coin could save taxpayers billions

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The Obama administration last week released its budget proposal for 2014 but neglected to heed the advice of Congress’ own budget watchdog, the Government Accountability Office, to modernize our one-dollar currency. Transitioning from the dollar bill to the dollar coin is estimated to generate at least $4.5 billion in government savings without raising a single tax or cutting a single program.

The GAO continues to recommend modernizing our $1 currency and testified to the benefits of doing so late last year before the House Financial Services subcommittee on Domestic Monetary Policy and Technology. Nearly all industrialized nations have already made this switch with Canada realizing more than 10 times their projected savings.

As a nonpartisan initiative, modernizing to the dollar coin is an issue that many Americans on both sides of the aisle care about. The dollar coin and the savings benefit it offers enjoy broad bipartisan support, not only on Capitol Hill but also from businesses, labor unions, budget watchdogs and experts from the U.S. Mint.

Public polling by Rasmussen has shown that 61 percent of Americans consistently support a transition to the dollar coin as a budget savings measure. The few who criticize this idea will say the American people are against the change. They are wrong. Americans know the seriousness of our budget issues and are willing to consider the available alternatives to put our country on a sound fiscal path.

Support for this modest proposal continues to grow. Our coalition, comprising small businesses, mass transit agencies, budget watchdogs, trade associations and private companies, has spent the past several months educating the public and members of Congress on the benefits of the dollar coin.

Now, as part of a comprehensive approach to the deficit, a proposal to save taxpayers billions by modernizing American currency with the dollar coin should be seriously considered by Congress. The GAO has made the recommendation nine times, and it is time for Congress and the administration to heed their advice.

Last year, a broad, bipartisan group of lawmakers introduced the COINS Act. We know many Members of Congress are looking forward to picking up where they left off, adding new sponsors to the bill, and hopefully holding additional congressional hearings to get the facts out about the dollar coin.

Now, more than ever, our government needs to get serious about the federal debt. Why then are we ignoring the billions that can be saved through this common-sense proposal?

Supporters of the dollar coin recognize that modernizing our currency is not the solution to all of our budget and deficit problems. But, we need to make a start with some savings, and this is a good place to do it.

The American people are ready for this change, the business community is behind it and, now, it is time for Congress to get serious about a viable budget savings solution that will save billions.

If Congress wants to show the American people that they are ready to get serious about the debt, reaching agreement around a modest proposal such as this should be an easy first step and a basis for further cooperation.

Former Reps. Tim Penny, D-Minn., and Jim Kolbe, R-Ariz., are honorary co-chairmen of the Dollar Coin Alliance.

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  1. Our currency and coinage needs a serious overhaul. It's at least 50 years out of date. It costs more than two cents to mint a penny and over eleven cents to mint a nickel, a condition called negative seignorage.

    I totally agree with eliminating the paper dollar and substituting a dollar coin. A dollar bill has a life under two years, while coinage can last 50 years or more. We should print and circulate two dollar bills. Further, we should quit minting pennies entirely and just round purchases to the nearest five cents (Canada just did this). The five cent piece needs to made of a different material such as plated steel or aluminum alloys and could be smaller than it is now.

    And, as an aside, maybe it's time to honor people born after the Civil War on our currency.

  2. This is definitely something that government should be doing to modernize our money. At the same time, it seems like a bit of a waste since the $4.5B in savings is not a one year number. It is not the normal 10-year horizon used by Congress when evaluating issues, but rather 30 years. 30 years is also the expected life span of the dollar coin versus the expected life of a dollar bill of five years. But at a savings of $150M/year over 30 years, there are much bigger issues on which member of Congress could be focusing their time to save us some big money.

    http://www.nbcnews.com/business/kill-bil...

  3. Yeah, I really want to carry 3 - 9 larger, heavier coins in my pocket instead of dollar bills in my wallet.

    NOT!

  4. It's been tried and died: Eisenhower dollar coins, Susan B. Anthony dollar coins. The former were way too big and the latter way too small AND always confused for a quarter. Yes, coins last forever in circulation. Paper bills have an estimated useful life of about 18 months. Coins are more cost effective than paper bills. But... dollar coins will never get complete acceptance and approval by Americans over bills. Never. The best that can be hoped for is coexistence of both media and then the coins will be stored and the bills circulated.

    Carmine D