27

The argument for ending the dollar bill

A pile of euro coins sit on a display of one dollar U.S. notes. There is an ongoing argument among some politicians in America to get rid of the dollar bill and replace it with coins.

United States Senator Tom Harkin of Iowa explains why we should abolish the dollar bill and replace it with coins.

Jeremy Hobson:I did a quick poll of the office this morning and we have 14 one-dollar bills among us -- and zero one-dollar coins. That's something Republican Senator John McCain and Democratic Senator Tom Harkin would like to change. They want to replace the dollar bill with a dollar coin, and they've introduced some legislation -- a bill if you will -- to do that. They say it would save around $200 million a year.

Senator Harkin joins us now from Washington. Good morning.

Tom Harkin: Good morning, Jeremy.

Hobson: Well, why do you want to get rid of the dollar bill and replace it with a coin?

Harkin: For a lot of reasons -- not the least of which: it will save us money. The GAO -- the Government Accountability Office -- has examined this six times: 1990, '93, '95, 2000, 2011 and 2012. And every time, they reach the same conclusion: basically, we should transition from the dollar bill and move to a dollar coin.

Hobson: And every time, Americans don't seem to be on board with that. They are given the opportunity to have dollar coins, but they don't want them.

Harkin: That's because we keep the dollar bill in circulation. If we didn't have the dollar bill in circulation, people would get used to the coins. Every modern economy in the world has made this switch.

Hobson: Senator, let me ask you this: when you go to Europe, or Canada, or some place that does use dollar coins, or whatever their currency is -- they have coin denominations -- do you get annoyed by having ten one dollar coins in your pocket?

Harkin: No. I took a vacation in Canada last summer, and quite frankly, I found having the two-dollar coin much better than going around with a lot of dollar bills. It didn't bother me a bit.

Hobson: Then why do you think there's so much opposition?

Harkin: Well, there's opposition from places where they make the paper for the dollar bill. There's opposition from the ink manufacturers that make the ink for the dollar bill, and on and on. I think the facts are on the side of moving to a dollar coin.

Hobson: So, what do you think's going to happen? When will you be able to get this bill through, do you think?

Harkin: We're going to continue to push on this; we have good bi-partisan support, as you know. But just to get the facts out to the public about how much money it will save us, and then it will make it much easier for large retail stores, vending machines, transit agencies -- all the arguments on the side of moving towards a coin. But then again, sometimes logical arguments don't always win in the United States Congress.

Hobson: Senator Tom Harkin is a Democrat of Iowa who has sponsored a bill that would replace the dollar bill, eventually, with dollar coins. Senator, thanks so much.

Harkin: Thank you very much, Jeremy.

About the author

Jeremy Hobson is host of Marketplace Morning Report, where he looks at business news from a global perspective to prepare listeners for the day ahead.

United States Senator Tom Harkin of Iowa explains why we should abolish the dollar bill and replace it with coins.

Log in to post27 Comments

Pages

The art designs are fine but the bulk of the coin is unacceptable

Are you just making coins for collectors, or do you actually want a dollar coin that the public will accept for daily use?
A properly SIZED dollar coin would be very useful. The biggest problem the ill-conceived dollar coins have is their bigness. I, along with the obvious majority of citizens, will never accept for daily use the dollar coin as it is currently sized.
A dollar coin with about the diameter of a dime, but with a smooth edge, as thick as a nickel (for coin machines and the visually impaired), and of a golden color, would be a welcome addition to my pocket. Unlike the eyes' inability to reliably differentiate small changes of scale, fingers are VERY sensitive to thickness and would essentially never confuse this dollar coin for a dime.
It is long-ago time for a dollar coin, both because of the high cost of maintaining dollar bills, and because of the declining purchase power of a dollar. In my sixty years, the dollar's ability to buy has been reduced to about what was a dime in my childhood.
Also, a coin of about the diameter as a nickel, but with a serrated edged, thin as a dime (also for coin machines and the visually impaired), and also of a golden color, would make a great five dollar coin. I would be happy to use both everyday.

A penny is not beneath me to pick-up so I want that coin. IF you get rid of the penny then government will raise taxes only a few pennies but it will result in a nickel raise due to rounding off. As for the dollar, I never did mind the larger coins values from the rest of the world, until 9-11. I have to go through metal detectors every day so I limit the amount of coins or most of the time do not carry any coinage. Lucky for me vending machines still take paper dollars should the need arise.

I have used dollar coins in Canada, Australia, New Zealand and Liberia and all those economies do just fine without paper money as smaller units of exchange. Of all the dollar-denominated nations in the world, the United States seems to be the only one agonizing over dispensing with the one-dollar bill... to my utter amazement.

Of course, we're the only one who agonizes over metrification, too, so what does that tell you?

I do not like coins, and never carry them.

I refuse to accept pennies, and I never stoop to pick up pennies or nickels. I hesitate to pick up dimes. Why we still mint and distribute pennies is one of the great mysteries.

Keep the dollar bill.

Make the dollar coin smaller so it is not so bulky and heavy, and it will be easier to make the change from paper to coin. It would be cheaper, also.

I will be happy to accept coin over paper... if and only if, we do away with the penny!!!

Insanity: doing the same thing over and over again and expecting different results.
Albert Einstein, (attributed)

Funny, sure applies to politicians...

Got a better idea: how about we ditch ALL the sub-$5 items -- coins AND bills -- in favor of a small-payments card. Before the euro, most European countries had made significant steps in this direction, and the existence of sub-50 cent coins was on a steep decline. The euro revived the Euro-penny, -nickel and -dime at a substantial expense, and for no real useful benefit. Pre-euro, I could count the times per month I used coins of ANY denomination on one hand. The smart card works, and it works at scale.

If we're stuck with one or the other (coin vs paper) for the dollar, I'm for the paper. You can't club someone to death with $20 in paper bills (I can testify personally that $20 in coins makes a very good mugging weapon -- I received the bruises and the concussion to prove it).

I've traveled in Canada and lived for months in Europe, and in in both cases it's not that I found the dollar/euro coins convenient, but rather that I didn't even notice them at all. Vendors and customers will just end up using the $5 bill more in combination with the dollar coins. As to the coins being too much like a quarter, that is only perception due to unfamiliarity. It took only a week after I started using dollar coins on purpose, for my fingers to tell the difference without looking. A quarter is only 0.12 inches wider than a nickel. The dollar coin is 0.088 inches wider than a quarter. A quarter is 0.008 inches thinner than a nickel; the dollar coin is 0.01 inches thicker than a quarter. Trust me, your fingers will get used to them after a few days of constant use; which will never happen so long as we have the wasteful $1 bills around. As to change pilling up in your home, well, that not the coins' fault. Use them! I never have more than seven pennies on me or in my home at any time. If something rings up to, say, $10.87, I hand the cashier $11 and two pennies (or the 87¢, if I have it). And as expresso2 said, most of us are using electronic money more and more anyhow. Finally as to this bill being a waste of time, the "this is not a real issue" argument can be used with a lot of useful legislation. I somehow suspect that Harkin and Co. are not going to make this their main priority; they are simply doing the business of Congress, which is creating laws. Frankly, as much as I would like to see this succeed, I don't think this bill is going anywhere.

It would be hard to comment on the “economics” behind this proposal without really knowing details of cost to taxpayers either way; but this really sounds like a stubborn useless idea of two senile gentlemen who have nothing better to do. With all the real issues we are facing nowadays these two geniuses chose the most unworthy battle to fight. Please focus your maimed attention on issues that could really help improve our economy, lower gas prices, or stabilize the mortgage market. Unlike Harkin, I would not appreciate spending my vacations walking around with 10 dollar coins jingling in my pocket, when I can have 20 dollars bill and don’t even notice it. One dollar coins should be an option, not an imposition; that could offer convenience for some but not for all.

Pages

With Generous Support From...