New dollar coin? Keep the change
The US Mint is at it again, trying to sell us another $1 coin that we don't need and that most people say they don't want.
You might remember the Susan B. Anthony coin that flopped so resoundingly after it was introduced in 1979. The US Mint hasn't forgotten, but insists that the new $1 piece will win the broad public favor denied the earlier version.
Well, the new coin is pretty: shiny gold, with a handsome likeness on the front of Sacagawea, the Shoshone woman who helped guide Lewis and Clark in their exploration of the West. Quite a contrast to the earlier dull silver coin bearing the stern visage of suffragist Anthony.
Substituting the new Sacagawea coin for dollar bills could save the treasury lots, Mint director Philip Diehl says. At 4 cents a coin, it costs one-third more to produce than a paper dollar, but the metal variety has a life expectancy of more than 30 years. Paper dollars normally wear out in 14 months. Those worn bills, however, stretch their function. They help keep the home fires burning - shredded greenbacks are the main ingredient in some fire logs. They line your living-room walls as insulation and are also used in landfill.
But pretty and economical are hardly enough reason to justify use of $1 coins. Yet, not surprisingly, it's more than enough for vending-machine and telephone companies, laundromat and transit operators who see the Sacagawea coin as a way to save on the cost of processing so many small coins and crumpled dollar bills.
Apparently, it's not enough reason, however, for most other Americans. A recent poll shows that more than three-quarters of Americans oppose shifting from paper to metal. Why, you couldn't even call a dollar a greenback anymore.
Yet the Mint forges on. It's spending $45 million on a marketing campaign designed to win public support for the new coin. That involves shipping $100 million of the metal dollars for use in making change at all 3,000 Wal-Mart and Sam's Club stores and as instant rebates inserted into packages of Cheerio's cereal. Another $100 million worth of coins went to the Federal Reserve for distribution to banks. That's only the beginning, says the Mint. It plans to produce as many as 1 billion of the golden pieces this year.
While it's true people have been storming Wal-Marts and Sam's Clubs in droves to snatch up the gold coins, they're collecting them not spending them. The Susan B. Anthony coin was a fleeting fetish for collectors at first, too. Despite the initial surge of interest in the Sacagawea dollar, there's no reason to believe it won't suffer the same fate as Susan B. Anthony coins.
Mint director Diehl might best pause in his drive to go metal to recall what he said in 1995 in response to legislation, introduced by Republicans from copper-producing states, that called for creation of a dollar fashioned of - yes - copper. He argued that if they were minted, "We will end up with billions of dollar coins on our hands again. We don't have room in our vaults."
I assume you're among the majority of Americans who prefer paper dollars. If you're not, I should show you my sagging pockets worn threadbare by summers spent touring countries with metal currency. You know how many dollar bills you usually carry? How many pieces of that light, easily stored currency? Imagine that many $1 coins loudly jangling in your pocket or purse.
That's how it is in Australia and Canada, where metal dollars are the norm, and in Britain, with its 1 coin. And that's how it will be in the US if the Mint prevails in dumping the hallowed dollar bill for an un-American alternative.
*Dick Meister is a freelance writer specializing in economic affairs.
(c) Copyright 2000. The Christian Science Publishing Society