I'm not sure how the new dollar coin is supposed to work out
Thu 15 Feb 2007, 03:02 PMTweet
by Ben Langhinrichs
The United States has tried a couple of times before to convince its people that they (we) should use dollar coins, to a resounding lack of success. There have been various reasons for this lack of success, but at least one problem has been that people have collected the coins rather than using them. Another problem was that people objected to the size of the coins (the Susan B. Anthony was impossible to tell from a quarter without looking, and while the Sacagawea was better, it was still hard to distinguish from other coins).
So, the U.S. Mint plans to combat these problems by putting out a new series of coins featuring U.S. presidents, which will be the exact same size, weight and color as the Sacagawea.
In other words, combat the problem of people collecting the coins by making them even more appealing and collectable, and combat the problem of the coins being the wrong size by making them the same size as the ones that failed last time. I guess I just don't quite get it. How is this supposed to work again?
Copyright © 2007 Genii Software Ltd.
What has been said:
571.1. Charles Robinson (02/15/2007 01:14 PM)
I like the idea of more coinage and less paper. It's much more durable so it has a longer life and can be cleaned, and it's more hygienic. I agree that the US Mint hasn't done enough to make the coins work.
For starters, they need to make them significantly different from existing coins. The Canadian $2 coin is two-tone, and I believe some of the British and Euro coins are, too. I think Portugal used to have some coins with squared off edges to help differentiate them.
571.2. Nathan T. Freeman (02/15/2007 04:55 PM)
Making them the same size/weight as the last ones prevents retooling of hardware such as vending machines.
Making them two-tone is a fabulous idea. The South Africans did that with their 5 Rand coin and counterfeiting went down drastically.
571.3. Nathan T. Freeman (02/15/2007 04:56 PM)
I should note, however, that I'm not a big fan of coins. I don't like stuff that jingles in your pockets. Paper is much simpler to handle.
571.4. Stephen Hood (02/15/2007 05:22 PM)
Charles you may not feel that way after they also introduce $2 version like we have in Canada.
Sometimes you feel like your carrying a bowling ball in your pocket:). Although sometimes it's worth it when you discover it's enough to pay for a nice meal .. for two. Those $2 (toonies) add up quick.
Btw they did a nice job up here of making them easy to distinguish. I'll give them that for sure.
I believe durability was the main reason for coins. In the long run it saves the mint a mint.
571.5. Ben Langhinrichs (02/15/2007 05:29 PM)
Charles - I like both the 1 euro and 1 pound coins a good deal more than tne new $1 coins. In general, I don't use coins much, but that is because the U.S. ones are not worth that much (and because I work from my home and don't have vending machines here). When I travel in Europe, I like the coins and use them more than paper. I think if we made a two tone coin, that would go a ways towards making them easier to distinguish.
Nathan - I don't think many vending machines accept the $1 coins now, but I might be incorrect. Still, if it didn't work before, and doesn't work now, that will turn out to have been a false economy.
Stephen - Durability is absolutely the reason, but they have to find a more compelling argument than "it will save us money". It is a bit like a software company changing thing to save themselves money, and forgetting to make it empower the user.
571.6. W^L+ (02/15/2007 08:30 PM)
The other thing to think about is cash register drawers. I don't think they have an extra space for another coin. The Susan B. Anthony coins were always getting mixed in with quarters, and I think the gold dollars do the same during high-volume times.
They need to be significantly larger than the quarter, with a polygon shape and unique color that cannot be confused with half-dollar coins. And you're right, we should have $2 and $5 coins also. The gold dollars color wears off and then you have a coin the same size and color as a quarter. Bad idea!
571.7. Ian Randall (02/16/2007 02:13 AM)
Australia has been using one and two dollar coins for nearly forty years.
Several years ago we also dropped the one and two dollar notes from circulation, now the smallest note is a five dollar bill. Our notes are also made of plastic rather than the fabric used in US and other currencies. Much more hygenic and durable.
You will get used to it, but be warned, dollar coins will force inflation because many smaller fees (parking etc.) will increase to match the dollar coin threshold.
A Similar thing happened when many european countries switched to euros. 20 lira suddenly became 20 euro over night. Be warned.
571.8. Ben Langhinrichs (02/16/2007 05:14 AM)
Ian - I agree that the inflation will happen... if the coins are accepted and used at all. Since they weren't the last two times, I have my doubts, and with the increase in the use of credit cards, I'm not sure that the moment hasn't passed. We'll see.
571.9. Ian Connor (02/16/2007 03:06 PM)
I was in Australia when the $1 and $2 was introduced and in the USA when the latest $1 coin was introduced.
The big difference in the USA was they kept making $1 notes where in Australia they stopped making the notes and only issued the coins.
Also, in the USA when I tried to use a $1 coin the person in the shop had to check with the manager if it was okay to take a $1 coin.
571.10. Alan Bell (02/16/2007 03:36 PM)
I am always astonished by the notes in America, all denominations look identical! It just takes ages to sort through all your notes to find one that is actually more than a buck. Having dollar coins would be great because it would drastically cut down the number of notes you end up with. I think that at some point someone is going to notice that there are accessibility laws which make the currency illegal and there is going to be a big switch over to notes of different sizes and colours. I think you should just divide all prices by 2 and adopt the quid as your currency :-) would make things a lot simpler.
571.11. Dwight Wilbanks (02/19/2007 06:54 AM)
There are a lot of angles to this issue, and I'm not without opinion.
I personally am in favor of the dollar coin, but, in a contradiction, I hate it when I get them. I try to get rid of them as soon as I can, and if it is to a person, I usually add an apology.
In my mind I compare this to the US switch to the metric system in the 70's (it failed), But, it was very much of the right thing to do. A switch to higher value coins is a good thing, dollar bills have a very limited life span. As far as currency goes, I would carry coins if I could buy stuff with them. In my opinion, for a $1 coin to be successfull we need a $5 coin, possibly a $10. When I was in Japan, where they have high value coins, I carried my coins with me, because they were valuable and I could buy stuff with them. Currently, in the US, I carry bills out of the house with me, then I purchase something, get change, when I return home my change goes into a bucket, when there is enough, I run off to coinstar to trade it in for real money (actually amazon credit).
571.12. Dwight Wilbanks (02/19/2007 06:59 AM)
If I remember right, the dollar coins cost $.09 to mint, if collectors buy them and keep them as property, from an economic standpoint, its like a tax, if you think about the goverment, like a business, it can be a success without wide spread acceptance.