THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Thursday, May 11, 1995 TAG: 9505100018
SECTION: FRONT PAGE: A16 EDITION: FINAL
TYPE: Editorial
LENGTH: Short : 46 lines
Congress is considering making changes in the money in our pockets. No, not another fleecing. The proposals include the replacement of the paper dollar with a coin and the elimination of the penny.
On the side of the status quo are only inertia and sentiment. On the side of making change is the chance to save a lot of money.
Dollar bills cost 4 cents to print. Dollar coins cost 8 cents to mint. But the paper bills have a useful life of 17 months. The coins last 30 years. By substituting coins, it's been estimated that the government could save as much as $350 million a year.
Critics point to the Susan B. Anthony debacle of 1979. Then, a new dollar coin was introduced but the public continued to cling to paper. But that's because the Anthony dollar was easily confused with the quarter and because the public was given a choice.
This time, the dollar bill would not be allowed to compete but would be removed from circulation. And the dollar coin would be made distinctively different in size and color from lesser denominations to prevent confusion.
A second change would be the elimination of the penny. It is viewed as a nuisance by the government and by a substantial portion of the public. It no longer buys anything. Penny candy is a thing of the past and a penny for one's thoughts won't even purchase a free association.
Yet the Mint is forced to produce 13.8 billion one-cent coins a year. Most end up in jars and cans until they add up to a worthwhile figure. About 70 percent of all coins produced are pennies at a cost of $30 million annually, about 60 percent of the Mint's budget.
These changes have been repeatedly proposed over the past 20 years. Every time inertia and sentiment win, and currency and coins remain unchanged. There is significant opposition in both houses of Congress this time as well.
But when painful cuts are being made in a huge array of government programs, painless savings in the cost of making money are too good to pass up. Congress should bid a fond farewell to the penny and the dollar bill and count the savings all the way to the bank. by CNB