It's Time to Switch From a Paper Dollar to a Dollar Coin
The Treasury Department's announcement last month of sweeping changes to our paper currency is rightly being heralded as a historic moment for our country. The modernization of our currency to pay tribute to great American leaders, such as Harriet Tubman, Sojourner Truth, Lucretia Mott, Alice Paul and Elizabeth Cady Stanton, is long overdue and an important symbolic moment for our society to reflect on the significant contributions these women have made to America.
The reaction to Treasury's announcement has been overwhelmingly positive, and it has also reignited a broader conversation about modernizing U.S. currency. In recent years, the federal government has considered changes to the penny, the nickel and the dollar note, debating their value to the American people. Now that the government is remaking our currency to recognize the diverse array of cultural leaders that have shaped our modern society, we can have an overdue discussion on how to modernize our currency to maximize its economic value.
The dollar note is a legacy denomination of our currency that has outlived its useful role in our economy. The U.S. is one of only three industrialized nations to still have a paper note with a value as small as one dollar. Most major economies in the world transitioned to a coin years or decades ago - and experienced significant savings for the government in the process.
If Congress took the step to modernize our one-dollar currency from a note to a coin, the American government - and the taxpayers who support it - would save up to $13.8 billion. Congress rarely has the opportunity to achieve that level of savings without raising taxes or cutting programs. What's even rarer these days, is a budget-saving option that enjoys bipartisan support in Congress and broad support among the American people.
Sixty-one percent of Americans back a switch to the dollar coin when they learn about the savings. That is one reason why Congressional advocates for responsible government spending, such as Senator John McCain (R-AZ), Senate Budget Chairman Mike Enzi (R-WY), and Representative Robert Pittenger (R-NC) and Congresswoman Kyrsten Sinema (D-AZ) have introduced legislation to implement at least $57 billion in cost savings throughout the federal government, including eliminating the dollar note and replacing it with the more sustainable and efficient dollar coin, through the USA Act.
It is important to recognize that this change in our dollar currency is long overdue. By one estimate, Congress has already missed out on over $2.6 billion in savings by not converting to the coin back in 2011. The missed savings grows larger every day, despite repeated calls from Congress' own budget watchdog, the Government Accountability Office (GAO). Over the past 25 years, the GAO has urged Congress to make the switch ten times due to the billions the federal government would save.
At this point, it is simply irresponsible to allow more time to pass before Congress pursues these massive taxpayer savings. Our country is literally throwing money away by printing dollar bills. Dollar coins are a more effective use of our resources - they have a lifespan of 35 years or more, when notes only last between two and four years. That means that each year approximately 3.2 billion $1 bills are removed from circulation due to wear and tear, shredded and sent to landfills.
It's pretty simple. Processing paper currency is more expensive than processing coins. Coins are better for the environment and the public is ready for the change. Here's one last point why we need to make the switch: This change generates savings the average American would benefit from everyday. Currency modernization would create an estimated savings for small, retail businesses of over $100 million per year.
Our country took the right step in modernizing our paper currency to honor those who have made America the great country it is today. It also ignited a long-overdue national conversation on the makeup of our currency, and as Americans take a closer look, they will start to question why it has taken Congress so long to modernize our denominations as so many other countries have already done. When Canada can achieve ten-times the estimated savings from eliminating their paper note for a coin, why aren't we doing the same?