A $1 Coin Could Save Uncle SamGene Koretz
It seems almost too good to be true. According to recent studies by the General Accounting Office and the Federal Reserve, the government could cut the deficit by $400 million a year--or $12 billion over the next three decades--simply by replacing the inflation-battered dollar bill with a coin of equal value. The savings would come in good part from not having to print and process paper notes, which have an average life of less than 18 months, compared with 30 years for a coin.
The idea flopped in 1979, when the government introduced a Susan B. Anthony dollar coin that people confused with a quarter. Moreover, a 1990 poll found that nearly 60% of Americans still don't favor a dollar coin. But such changes have been successfully implemented by almost all other industrial countries. In fact, based on current exchange rates, coins worth from $1.40 to $4 are now jingling in the pockets of the buying public in such countries as Australia, Britain, France, the Netherlands, and Spain.
In every case, such higher-value coins faced initial public resistance but won increasing acceptance as the notes they replaced were removed from circulation. Canada introduced a dollar coin in 1987, and roughly half of Canadians now favor the move, while a further 32% feel neutral about it. The GAO thinks a dollar coin could fare as well in the U.S. if Congress and the Treasury really got behind the conversion.
Of course, that would mean braving popular resistance. Given the current hypersensitivity of Congress and the Administration to the vagaries of public opinion, that doesn't seem likely. But if the mood changes in Washington, replacing the aging greenback with a new dollar coin may just turn out to be an idea whose time has come.
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