Ditch the Dollar Bill and Live with Change
November 4, 2011
Tasked with reducing the federal government's projected deficit by $150 billion per year, the congressional "super committee" must explore numerous options that might not otherwise have been on the table. While national discussion of the super committee's objective tends to focus on drastic changes to spending and tax revenue (as would be had with tax increases or entitlement reform), a potential source of additional revenue that has received considerably less attention is the elimination of the paper dollar-bill, says USA Today.
- The typical paper dollar-bill has an expected lifespan of three years, while a dollar coin is estimated to last as long as 30 years before it needs to be replaced.
- The Government Accountability Office estimates that savings from switching from paper to coins would amount to $184 million a year, or 0.1 percent of the $150 billion target.
- Previous efforts to regularize public use of dollar coins have been largely unsuccessful, leaving government vaults with over $1 billion in unused coins.
Several factors will come into play when considering a decision as substantial as a change to dollar currency. First among them will probably be its financial impact -- though small, it stands to reason that when cutting so much money from the federal deficit, every little bit helps. Second, many detractors will be quick to point out that the American public has no love of dollar coins, evidenced by previous failures to regularize their use.
Two additional factors, however, are also likely to prove crucial in making such a decision. The first is the inevitable lobbying battle over the issue, which has pitted mining companies and vending machine businesses (under the banner of the Dollar Coin Alliance) against the coalition known as Americans for George, made up primarily of printers and ink distributors. The second, which should also hold weight despite its less-than-official nature, is that symbolically, if Americans cannot accept this level of reform, how will they swallow the much bigger reforms to come with the super committee package? A proposal such as this one ought to be included in the committee's recommendation in order to underline the fact that Americans will have to tolerate big changes if they want big solutions.
Source: "Ditch the Dollar Bill and Live with Change," USA Today, November 1, 2011.
Browse more articles on Economic Issues