The paper bill featuring George Washington’s face could soon disappear from American wallets. Congress’s Joint Committee on Deficit Reduction is considering a proposal to end production of the $1 bill in favor of the $1 coin. The move, which would cost money in the short term, eventually would save the government an estimated $5.6 billion over 30 years, according to the Government Accountability Office. Paper money only lasts about 42 months before it needs to be replaced. Coins are much more durable, or long lasting. But the switch would be a controversial one.
An Unpopular Coin
Most Americans prefer the bill as currency, even though most European countries use coins instead of small bills. In 2002, the Government Accountability Office conducted a nationwide public opinion survey on the use of dollar coins. According to a report from the office, “the public was not using the $1 coin because people were familiar with the $1 note, the $1 coin was not widely available, and people did not want to carry around more coins.”
In 2005, Congress passed the Presidential $1 Coin Act, which authorizes the production of millions of $1 coins honoring every deceased President. The move was an attempt to boost the dollar coin’s use. Since then, the coins have piled up in Federal Reserve vaults as many Americans continue to ignore them. While 60 percent of dollar coins produced by the government make it into circulation, more than $1 billion worth of unused dollar coins sit in the vaults. But experts say that Americans would simply get used to using $1 coins if dollar bills were no longer available.
A Two-Sided Coin Debate
The Joint Committee on Deficit Reduction, which is made up of 12 members of Congress, is charged with the task of finding ways to save the U.S. government money and pay down our nation’s debt. Those who support doing away with the dollar bill say that this would be an easy way for Congress to save money. Vending companies and mass transit agencies support the use of the $1 coin because it is easy to use in vending and ticketing machines.
Paper and ink producers are against the switch. It would result in a loss of business to companies such as the Massachusetts-based Crane & Co., which makes the paper used for U.S. bills. The armored-car industry, which transports money, is also against the switch because the coins would add weight to their trucks and increase their gas and maintenance costs.
For now, the switch is not certain. The committee has not yet released its official proposal for reducing government debt. What do you think? Should the government switch to $1 coins to save money? Vote in our poll below!