Presidents Day is a holiday dedicated to commemorating George Washington, the father of our nation. Ironically, as we celebrate this moment, America is in danger of losing another remembrance for our first president: the $1 bill.
With the advent of the Currency, Optimization, Innovation and National Savings (COINS) Act, we potentially could lose the dollar bill within a couple of years. The COINS Act proposes to phase out production of $1 bills within four years. The idea that the COINS Act will save us money is a myth. It's a budget gimmick, it's founded on insufficient evidence and, most important, it does not reflect the desires of the American people.
Adoption of this legislation is not in the best interest of our country.
The dollar-bill-versus-the-dollar-coin debate has been taking place for decades. Coin supporters claim elimination of the dollar bill will save the government billions of dollars. With the government in debt and facing an economic downturn, now seems like an opportune moment to make that argument. Backed by the Dollar Coin Alliance, Rep. David Schweikert, Arizona Republican, introduced the COINS Act in the House, while Sen. Tom Harkin, Iowa Democrat, and Sen. John McCain, Arizona Republican, recently introduced the same legislation in the Senate. With plenty of other, more reasonable methods of reducing the deficit, it's hard to believe the COINS Act isn't much more than something to appease special interests in the legislators' respective home states.
The congressmen in favor of the bill cite reports by the Government Accountability Office (GAO) as valid support for the COINS Act. GAO findings predict that by switching to the dollar coin, the government will save $4.4 billion over a period of 30 years, not enough to make a dent in our current $1.2 trillion deficit. According to the reports, the proposed switch will not become profitable for at least the first 10 years, resulting in a net loss to the government that would amount to $531 million.
It also is important to keep in mind that the report does not take into account the effects on the private sector of replacing the dollar bill with the dollar coin. An analysis by John Dunham & Associates, a New York-based independent economics research firm, shows that a switch to dollar coins would cost businesses an additional $201.85 million per year and cause at least 4,300 job losses. Businesses also would be burdened with the costs of transporting, storing and distributing the dollar coins.
As important as the potential fiscal savings is the opinion of the American people. A recent poll by Luntz Global showed that in light of the GAO findings, 83 percent of Americans still prefer to keep the dollar bill. The same poll found that 97 percent think paper money is more convenient, 99 percent think paper is easier to carry and 90 percent would rather receive a dollar bill as change for a transaction. It is not the government's place to force dollar coins upon an unwilling population. The people already have made their decision. And they continue to show the government their preference for the dollar bill time and time again.
The government has attempted to encourage widespread use of dollar coins several times in the past with little to no success. All four of the government's dollar coin programs - Dwight D. Eisenhower, Susan B. Anthony, Sacagawea and Presidential - have failed to reach popularity. The most recent attempt, the Presidential Dollar Coin Act, was so unsuccessful that the Federal Reserve has $1.5 billion worth of unused and unwanted Presidential coins sitting idly in storage. Clearly, generating wide-scale adoption of the dollar coin is an uphill battle unlikely to be successful.
The Luntz Global poll further revealed that 66 percent of Americans think eliminating the dollar bill would erode our national character. The dollar bill is our way of celebrating our first president: It is a symbol of national pride and a part of who we are as a nation. The COINS Act is a budget gimmick based on faulty research findings. Politicians claim the bill will contribute to debt reduction. In return for uncertain results, these legislators are asking us to change our identity, but we shouldn't have to change who we are just to save a little bit of money.
Randy DeCleene previously worked as Vice President Dick Cheney's deputy press secretary and as a senior adviser to the secretary of the Army. His firm, K-global, represents Americans for George, a pro-dollar-bill organization.
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