Consumers Say No to Dollar Coins
By Mike Unser
The U.S. Mint is spending about $12 million in a
four-city pilot program in an attempt to
dissuade consumers away from their convictions
that dollar coins are superior to paper bills.
The pros and cons of $1 coins have been debated
for years. The first round knockout always goes
to the untouched champ, Mr. Paper Note. The
bruised coin then pines away within government
storage until its next mandated match.
In a cruel twist of fate, the dollar coin has
just a few things going for it — coin collectors
who find it unique, its production savings, and
a government that continually throws money its
way. The latter is despite foreknowledge the
coin will always drop to the canvas hard as long
as the $1 bill is pumped up by adoring consumer
fans who use it every day.
$1 Bill versus $1 Coin: Which is the Winner
$1 Bill and
Coin Fun Facts
|It takes 56 $1 coins to equal 1
pound (lb), or 455 $1 bills.
|$1 coins are much HEAVIER
for consumers and businesses.
|Paper money is composed of 25%
linen and 75% cotton. $1 coins are
made mostly of manganese-brass (88.5%)
and copper (6%).
|Paper money can be folded and
shaped to fit nearly anywhere. It’s
|A stack of dollar bills one mile
high would contain over 14.5 million
notes. It would take 804,672 dollar
coins to reach a mile.
|$1 bills are LESS BULKY.
|The BEP produced 4.147 billion $1
notes in FY 2007. The United States
Mint produced 0.941 billion $1 coins
|$1 bills are USED DAILY
in transactions. Where are all those
|It costs ~16 cents to make $1
coins, and each has a life span of
about 30 years. It costs ~ 6.2 cents
to make $1 bills, and they have a life
span of about 21 months.
|$1 coins are much more
While the US Mint has produced 120 million
Presidential $1 coins on average for each of the
first three honored Presidents these last 10
months, the Bureau of Engraving and Printing (BEP)
reported a total production of 316.8 million $1
notes in September alone. What a mismatch.
Supporters of dollar coins will rightly argue
they last about 30 years while the life span of
a dollar bill is just around 21 months. But just
like boxing, endurance means next to nothing if
the match ends in round one. The final blow to
Presidential $1 coin is that relatively few
consumers use or have even seen one in their
hand despite over 1.3 billion being minted to
USA Today’s Barbara Hagenbaugh wrote an
insightful article (embedded below) on the topic
of the new coins. She recounts the famous Harris
Interactive survey from last March showing that
only one-quarter of adults had seen Presidential
coins and only 13 percent favored using them
over paper money.
Despite the popularity of the state quarter
program, the presidential dollar coins have not
taken off, and interest appears to be waning.
Federal Reserve banks, which buy coins from the
Mint based on demand from banks that serve
consumers and businesses, bought 96 million of
the Andrew Jackson coins, the seventh and latest
in the series. That is less than half the amount
of Washington coins ordered.
This is not new for $1 coins, however. The
failure of the Sacagawea Golden Dollar with 92.7
million of them still in storage from 2000 and
2001 is a small sampling of past letdowns.
Who is at fault for the continual failure of the
dollar coin? Certainly not the U.S. Mint.
Congress mandates their actions. Responsibility
could be placed on the shoulders of a public who
refuse to use the coins even though they save
money. But that lacks logic. The government is
providing an option, after all. People are
simply choosing paper over coin for its obvious
In the end, it is Congress that has failed. If
politicians want any degree of real success with
$1 coins outside the collecting community, they
must eliminate the one dollar bill. Passing
legislative directives for various dollar coin
designs or programs has not resulted in any
significant consumer transactional increases.
The dollar bill, winner by knockout again…