Is Sen. John McCain trying to have his political cake and eat it to? His legislation calling for a 10-year suspension in the production of the cent outwardly appears to be an attempt to put an end to our lowest denomination because it costs too much. But is it?
Because the legislation calls for cent demand to be met by existing supplies, he clearly is assuming that cents will continue to be used in commerce.
If that is the case, passage of the legislation would condemn the country to perpetual shortages of the coin.
Even when the economy collapsed in late 2008 and reuse of one-cent coins was at its peak, the banking system still ordered almost 2.3 billion cents in 2009.
The only way the existing supply can meet demand for cents is if merchants stopped using them. Certainly they could,.If the legislation is passed, they might conclude that it would be better to stop using the coin rather than spending their time trying to scrounge up adequate supplies for their customers.
But this then would put the onus of the abolition of the denomination on the likes of Wal-mart and Piggly-Wiggly rather than the government.
Would that two-thirds of Americans who support the cent focus their attention on the Congress or the merchants? But of course that is probably why the legislation uses the softer language of suspension rather than abolition.
There is no study required for the $1 note. It would be ended in two years’ time. The dollar coin would reign supreme.
Coin collectors have long recognized that the only way a dollar coin can succeed is if the $1 bill is eliminated.
The public does not like this idea. They express their opinions every time they use paper. The last experiment for the dollar coin was the introduction of the Presidential dollar. Supplies backed up to over a billion and the government suspended production for circulation at the end of 2011.
Why is there no study of this required in McCain’s legislation? Well, we know why. It could only conclude that Americans prefer the paper note.
Because the nickel has the same problem as the cent, it costs more to make than its face value. You would think logic would dictate a suspension for this denomination, too.
A increase of copper content from 75 percent to 80 percent will not push its production cost below its face value with the current cost structure of the U.S. Mint.
This seems to be more a shot across the bow of the U.S. Mint and its study of cheaper compositions. It is also a shot at zinc producers, which would be affected not only by the suspension of the copper-coated cent, but by the end of the examination of the copper-coated zinc five-cent coin option.
McCain has been on the side of copper producers, but that is no surprise as he is from Arizona, the largest copper producer in the country. Calling for more copper in the nickel and striking more dollar coins made mostly of copper shows his support.
This article was originally printed in Numismatic News. >> Subscribe today.
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