And change the composition of nickels right now! Tradition is one thing, but if the government makes these coins at a loss, why not do something about it!
It costs the federal government up to nine cents to mint a nickel and almost two cents to make a penny
(click to continue reading Feds Likely to Face Uproar if They Overhaul Pocket Change – WSJ.com.)
But of course, nothing is ever simple to accomplish in Washington:
The president’s plan to save money by making coins from cheaper stuff seems simple on its face. But history shows it would rekindle an emotional debate among Americans who fear changing the composition of their currency will hurt its value.
On top of that, trade groups from the coin-laundry owners to the Zinc Association have lobbied for years to keep small change just the way it is.
Like many things produced in Washington, U.S. coins aren’t what they seem. A penny is a copper-coated token made mostly of zinc. The nickel contains more copper than it does actual nickel. And no coin contains silver anymore.
Market forces, not metal prices, determine the value of American currency. Yet Americans persist, on websites like coinflation.com, in tracking the value of the metal in their currency.
“People believe that we are still on some sort of precious-metal standard,” says Rod Gillis, educator at the American Numismatic Association.
As the White House looks to cut costs across government, “making coins from more cost-effective materials could save more than $100 million a year, which isn’t just pocket change,” says Dan Tangherlini, the Treasury Department’s chief financial officer.
And there the nutjobs, Glenn Beck fans probably
Already, Mr. Gillis spends a chunk of his day at the coin-collectors association taking calls from Americans worried that the Obama administration will confiscate their gold coins to prop up the economy.
He often asks people what gives a paper dollar its value. “Eight in 10 people make some sort of reference to the gold in Fort Knox,” he says. But America has been off the gold standard since 1971, and gold currency stopped circulating in 1933.
We should listen to Frank Abagnale1
Footnotes:Convicted forger Frank Abagnale pooh-poohs that idea. “People would be more apt to counterfeit casino chips than American coins,” says Mr. Abagnale, who advises governments and companies on how to avoid fraud and forgery. “I’m one of these people who would be in favor of doing away with the penny. I’m always in airports, and people just leave them all over the place.”
- you know, the guy that Leonardo DiCaprio played in Catch Me If You Can [↩]