Few countries still produce a banknote with as little value as the US $1 bill. Because the bills wear out so quickly, the government has to print about 2 to 5 billion new ones every year. Producing bills instead of relying solely on long-lasting dollar coins means extra expense for the government, extra annoyance when consumers try to use them in finicky vending machines, and extra challenges for blind Americans who have to distinguish between identical-sized bills.
The House of Representatives recently heard testimony that phasing out bills would save $4.4 billion over the next 30 years. In the past, such proposals were easily mocked as small-bore thinking. Getting rid of $1 bills won’t make a big dent on the budget deficit. But $4.4 billion is hardly chump change, either.
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Apparently, because they wear out so quickly, people choose to use the 1 dollar paper bill instead of the existing 1 dollar coin. If people wanted to use a coin they could. Everytime the government tries to get us to shift our currency habits, we vote with our wallets. If the government wants to try and big foot this again, let them try, but it will fail.
The biggest problem with the current coins is :
1) there's no place to put them in cash drawers
2) they're indistinguisiable from quarters
Both need to be addressed.
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Get rid of the penny at the same time to make room in cash register drawers for the new coin.
No one wants to be carrying a fistfull of coins in their pocket.
$4.4 billion over 30 years is less than 50 cents per person per year. Hardly an impressive saving.
$147 million savings per year isn't impressive? On what planet?
The biggest problem with the current coins is :
1) there's no place to put them in cash drawers
2) they're indistinguisiable from quarters
Both need to be addressed.
One problem seems to be that every time they come up with another dollar coin, it doesn't differ significantly from the quarter! That leads to confusion. In a recent home burglary, thieves failed to recognize the Sacagawea dollar coin at all! They took quarters but left the dollars, probably thinking they were foreign coins!
We'll get rid of the dollar bill with George Washington's face on it and the Globe will run another editorial endorsing a dollar coin with Oprah Winfrey's face on it.
Low denomination bills have little value because 65 years of inflation have reduced the dollar's purchasing power from $1.00 in 1958 to $0.11 today, inflation adjusted. A greenback held its value for decades when you could exchange it for a fixed amount of gold or silver but convertibility to gold was eliminated in the 1930s and convertibility to silver was eliminated in 1964. There's no honest money anywhere in the world anymore. In 20 years the Globe will harrumph and come out in favor of a $5 coin for the same reason as today's editorial. Oh, and dollar coins used to be made of silver worth a dollar but no country will make that mistake again, coins will be made of the cheapest metal possible, intrinsic value hasn't been a priority for fifty years now. Eventually we'll have to do a rewrite like Mexico did twenty years ago and just move the decimal point three spots to the left, because we'll need a wheelbarrow to carry around all of our paper money and it won't buy a loaf of bread.
I can umagine a durale plastic currency. about the size of a credit card, but thinner. It would have slightly textured surface to make it non slippery, be easily machine readable; with reliable anticounterfeit peatures. The technology is available, and it will be more economical than either metal or paper currency.