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Your Government Inaction: Dollar Coins
As a young coin collector in 1971, I was quite excited by the announcement that the US Mint would be producing a dollar coin after a lapse of 36 years. The coin was in honor of recently deceased US President Dwight D. “Ike” Eisenhower. The actual coin was somewhat less than exciting. With all due respect to the late war hero and president, the portrait on the coin was, to put it mildly, unflattering:
Still, I traded in some dollar bills for the coins and used them to make purchases. The retailers I patronized with these were not very happy about accepting them. After 36 years, cash registers didn’t have a slot for dollars in their change trays. Being the size of a traditional silver dollar, often they were too big to fit in any of the change slots. The size was also an impediment to me. The coins were large, heavy, and unwieldy. I only did that for a week or so.
Needless to say, the coin was just as unpopular with everyone else. So, the government quickly decided to end the experiment. After eight years and 682,567,105 coins minted for circulation.*
And decided that the problem with the coin was that it was too big and not ugly enough. So, the US Mint came up with this:
This is the Susan B. Anthony (SBA) dollar. With all due respect to the feminist icon, etc., UGH. Beginning in 1979, the US Mint began making these to replace the Ike dollars. They were a little bit larger than quarters and the same color, so they were supposedly mistaken for quarters. I doubt that that was true because, for that to happen, people would have had to use them.
In 1980, I was a clerk at a liquor store. One time, I found an SBA dollar in my cash register and attempted to give it in change. The customer said, “What the #@$!!* is this,” threw the coin on the counter and politely demanded I give him a “real” dollar, using language I can’t repeat without violating the CoC. In my lifetime, I have worked retail about four years, in addition to being a cashier at a swimming pool and volunteer at food stands for sporting events. Through all that, this was the only time I have seen a dollar coin being used. I have literally found more dollar coins on the ground than I have seen as a retail employee.
The problem with this coin was not that it looked like a quarter. The problem was that it was a dollar coin, and nobody wanted them. The mint figured this out pretty quickly compared to the Ike dollar, and stopped producing them for circulation after only two years. They still made over 800 million of the damn things. Then, in 1999, they made another 41 million “as a safeguard in anticipation of increased public demand before the Sacagawea debuted in 2000.”** If you think that last sentence makes any logical sense at all, you have a bright future as a government bureaucrat.
In 2000, the US Mint came out with the Sacagawea dollar. To combat the problem of confusing them with quarters, the coins were made in a bright golden color. A nationally-renowned sculptor designed the coin, and it was definitely better looking than the Ike or SBA dollars. An advertising campaign promoted them. Vast amounts were shipped to Wal*Mart® stores and they were included in boxes of Cheerios®. In response to anticipated demand for the coin, the mint produced 1,286 billion of them.
And again, no one used them.
Maybe it was the fact that they looked like tokens from arcades, maybe it was some other reason, but nobody wanted the new coins. Someone in the mint got a smart idea: Why don’t we offer them to the public at face value with free shipping? So that’s what they did. And people bought thousands of dollars of the coins with their credit cards. And immediately redeposited them in their bank accounts while pocketing the cash-back bonuses.
As an aside, the US Mint still made money on the deal. The Sacagawea dollar cost a lot less than a dollar to produce and distribute. In fact, the metal in it is only worth about 6¢. There’s actually a word for this: seigniorage. So, the mint made money, the buyers of the coin made money, the credit card companies made money, free money all around! In fact, that is a solution to our debt problem. If the mint made 33 trillion Sacagawea dollars, then shipped them to everyone at cost, our national debt would be gone in no time. And if you think that last sentence makes any logical sense at all, you definitely are only fit to work for the government.
Again, the mint figured out that no one wanted one-dollar coins and stopped issuing them for circulation after two years.
Then, in 2007, someone at the mint said, “I know what’s missing! Ugly portraits of U. S. presidents!” And so the presidential series of dollars was created. I’m being a little hyperbolic, as not all of these coins are ugly. Ironically, Eisenhower’s portrait is pretty good, much better than on the ’70s Ike dollar. But a good number of the coins are genuinely repulsive. Ronald Reagan and George H. W. Bush both have rictus grins. Andrew Jackson appears to be a cross-eyed hick. FDR looks like a high school principal with constipation. Here’s Abe Lincoln:
This is the only presidential dollar I have actually touched. I found it in the grass next to a gas station. All of them remind me of this:
This was a token from a promotion by Shell Oil back in 1968. Frankly, the portraits of the presidents on these aluminum game pieces are better than most of the real coins produced by the mint.
And, of course, no one used the presidential dollars. I would bet more than half of the people reading this are not even aware of them. So, after five years and 2.376 billion coins produced, they stopped making these for circulation.
For 40 years, the government tried to get us to use dollar coins. And every single attempt was an utter failure. The sad part of this is that it didn’t have to happen this way. In fact, I know a way to guarantee that the dollar coin will be enthusiastically embraced, and it will save money as well. And I know for certain that it would work, because it has worked many times in the past.
Get rid of the dollar bill.
Every other major economy in the world that has a currency similar in value to ours has eliminated the one-unit paper bill in favor of coins. Canada, Australia, New Zealand and Singapore all got rid of dollar bills over thirty years ago. Great Britain has had only Pound coins since the ’80s. The Swiss have never had a 1 Franc bill. The European Union started their monetary scheme without a one-Euro note. All of those countries are fine with Dollar, Pound, Franc, and Euro coins.
So why haven’t we done the same? For starters, the US Mint, that makes coins, and the Bureau of Engraving, that makes bills, are separate bureaucratic sinecures within the Treasury Department. Dollar bills are popular and what politician is going to take a risk getting rid of something that’s popular? (See for example: Every other government program.). Then there’s just basic bureaucratic inertia. As a result, the US Mint has produced 5.6 billion dollar coins that no one wants or uses.
But that’s nothing. Since 1972, the mint has made more than 5.6 billion 1¢ coins every year. And, for at least the last 20 or so years, each penny costs more than a penny to make. Only the government can lose money by making money.
* My numbers in this post are from A Guide Book Of United States Coins, 2023 Edition, J. Garrett, Q. D. Bowers, K. Bressett Eds., Pelham AL, Whitman Publishing, 2022. I am only listing the number of “circulating coins,” i.e., coins ostensively to be used by the public for transactions. Millions of these coins were also produced in special editions for collectors.
** A guide Book Of United States Coins, 2023 Edition, p. 242.
Published in Humor
Guilty as charged.
They’re right up there with the Jefferson 2 spot.
If they get rid of the $1 bill, they can use the free slot for $100 bills, which are becoming more necessary, if you don’t want to tilt over when you sit on your wallet.
Up here in the Great White North, our bills are manufactured by a private company. Only the coins are manufactured by the government.
The company also makes other documents and identification/security systems for governments and private industry, so they aren’t entirely dependent on the Canuckistani government for their revenue. As such, the company was able to adapt when the $1 and $2 bills were discontinued.
Private industry for the win!
(The Royal Canadian Mint also makes coins for other countries. As such, it could handle the loss of business when Canuckistan abolished the penny. It currently turns a profit of about $1.24 million per year. Imagine how much more it could make if it didn’t have to pay public sector union wages!)
a) I haven’t carried cash in years. I ain’t sayin’ that’s a good thing, but it is a thing.
b) The existence of the $2 coin greatly reduced the number of coins I had to carry when I did carry cash, as did the $2 bill before the coins were introduced. One of the most irritating things about travelling in the US is the large number of singles I end up with. The $2 bill is SUCH a good idea. Ah well, c’est la vie!
This is such a minor story that I can’t quickly find a reference. Crane paper, the company that makes the paper stock for federal reserve notes is located in Dalton, Massachusetts and I was told very friendly to Teddy Kennedy. Teddy was a reliable vote against replacing dollar bills with coins because it would severely impact that corporation and the town.
Lots of people still use cash for something or another, and will have noticed they need a lot more of it than they used to.
What they really would like to do is eliminate all currency and give you, a citizen, a government-provided plastic card that will allow you to spend government-supplied electronic currency in government-approved ways.
Conspiracy theory? Maybe. Coming attraction? Maybe.
Bring back the Walking Liberty as a legal tender dollar and we can call it a day.
I actually use a variant of the story of the Golden Dollar (the Sacajawea) and the Loonie (Canadian dollar coin) when talking about how to get people to move from one system to another in IT. It was a better analogy than my initial one that used Sun Tzu which I really liked, but my presentation Sun Tzu and the Art of Digital Transformation never quite took off. Essentially, your point about getting people to use dollar coins by stopping printing dollar bills is the same as why people if given access to and old and a new system will continue to use the old one.
I’m sure the strippers would appreciate getting fivers instead of singles. Coins probably wouldn’t work for that.
Ditto – never heard of them.
One reason the dollar coins were unpopular is that vending machines never took them.
I have, however, received dollar coins from a vending machine in change for a $5. I still have two of them I keep with my travel stuff in case I run into a machine that takes them. Hasn’t happened yet.
Post Office vending machines take them, and also give them as change. As least they did the last time I used one.
For the novelty, I decided that the Tooth Fairy visiting our home would give out $1 coins. They were hard to get at banks and the last couple of years have been bills. I think my daughter has three baby teeth left, so I need to push to find coins for those last ones.
Well yeah, that would work. It might antagonize a lot of people but bureaucrats never seem to mind.
I arrived in the UK in 1985 and the 1 pound note had just been replaced by a coin. It worked. I have seen a 1 pound note, but I don’t think I ever acquired one. The 1 pound coin was distinctive and attractive, which helped. It actually has flat sides, unlike the Susan B. Anthony.
And it was accepted by vending machines IIRC.
edit: And it was noticeably heavier. That tactile clue helped distinguish it. These days I have to put on reading glasses to distinguish nickels from quarters. They’re all feather light with unfamiliar designs. I don’t like ’em.
Government coercion is not required for that to happen, however it might require the loosening of anti-trust laws that get in the way of the banks working together on standards for electronic transactions. Up here in the Great White North the debit card system (Interac) is co-owned by all the banks, and I believe the credit card companies pay for access to the Interac network, so credit cards and debit cards all work on the same system. It’s damned convenient, as long as you don’t think too much about the privacy implications.
There was a place in Dallas that gave all its change in $2 bills. Or so I heard. Seriously, I was never there.
I don’t like dollar coins, because they feel cheap. I do love one-pound coins, because they have just enough weight, and you feel a bit better having five of them and some change in your pocket. I never feel that way about American money any more.
The psychology of money is curious and fascinating, no?
One used to be able to identify a Yank in Toronto by the amount of coins in his pockets.
I use cash whenever I can. I want to keep cash viable to use at vendors. Plus, it saves them a few percent for every transaction.
Who wants to see a stripper with a roll of quarters in her panty.
“I like your dancing. Do you make change?”
About 1982 I was helping deliver appliances. On one delivery the customer paid in cash. $600 in 2 dollar bills.
I asked my supervisor about it and he said the racetrack paid out in $2 bills. I guess the lady won that one.
Before Covid a local cinema used $2 bills. I think a matinee cost about $8, and whenever a customers proffered a $10 the clerk gave them a $2 back.
Do they chime when you drop them or do they squeak? 1967 copper pennies chime when you drop them or clink them together. Post-67 pennies squeak. And euros squeak.
They kind of clunk.
And as long as you never, ever protest against anything the government has done, is doing, or might do in the future.
I’ve watch a few YouTube videos of foreigners criticizing American currency and they have merit. I’m surprised that the DIE class hasn’t forced a change in our money. One big point is that all our bills are the same size. Blind people can’t tell a $1 bill from a $20 bill, but some countries have them increase in size as the denomination goes up. I’m willing to accept constructive criticism.
Increasing size can be a pain in the wallet. In the UK, the fifty pound notes are huge. When I’m buying a wallet, how optimistic should I be?
Us really old guys have fun talking about cash money in the old days. I know I’ve bent all ears here talking about my career effort to take paper out of the payment system by moving to electronics starting in the seventies.
What I remember about coins in the forties is that I could get peanuts and candy from coin-operated machines for a penny and a co-cola in the original 6-ounce bottle (the only option) for a nickel.
I have fun now as a story-teller when I go into an empty bank lobby with bored tellers and sometimes even bored people sitting at desks (sometimes they are the tellers). I tell them about my work to convert paper checks and deposits to electronics but sometimes I’ll even tell them about my time as a bank payroll teller in 1960. Many business customers would issue payroll checks to their employees but then, rather than have those employees leave work and get stuck in line at the bank to cash or deposit the checks, they would order large amounts of cash from the bank (me) and have it delivered by Brinks Armored Carrier. I frequently paid out over a million dollars in a day when the minimum wage was $1.00/hr and few people made more than $5,000 annually. Also, since some very wealthy people were customers I frequently was called on to accommodate them with $1,000 and $500 bills. Who knows why they needed those. There was no reporting of those transactions then.
Anyway, fun telling stories.
Seems obviously a problem for automated currency-handling too.