WHY does the US still have a dollar bill instead of coin?

[GorillaMan]

@Spectre of Pithecanthropus

Besides public stubbornness, there are a couple of factors I’ve heard cited. One is that the Bureau of Printing and Engraving, which prints paper money, has successfully lobbied against eliminating the dollar bill, which would drastically cut down on their workload. Then, as for the new dollar coins, I was also told that the major armored transportation companies were reluctant to retool in order to be able to handle them.

This is interesting. It suggests that the US ‘currency market’ is way out of step with the rest of the world. Not least because most currency printing elsewhere in the world is something done by private companies - example

…the public’s concept of coins has become so skewed to the idea that coins aren’t money, really, they’re just a nuisance factor in your daily life. They’re just something you get back and have to lug around, because you usually don’t use them to buy stuff.

Is this really a common perception? The comparison I think of is Italy, who until 2001 were still using 1000 Lira notes, equivalent to about 40 US cents. They hadn’t bothered sorting out that system for many years, because they knew the Euro was coming sooner or later. But nobody felt that a €2 coin was more awkward than six or seven banknotes.

[Bearflag70]

@Spectre of Pithecanthropus

IMO even $2 is too small a denomination for a bill.

You may have a point here. Even with a $2 coin I don’t see a problem with most people having to lug around a bag of coins.

It seems that, on average, replacing $1 and $2 bills with coins shouldn’t be a big burden. It’s only a couple of extra coins in your pocket that will probably be spent more quickly than other coins, instead of just kept and thrown into a jar.

Did Canadians have to run out and get coin bags or pants with Big-Sturdy-Zipper-Pockets when the Looney and Twooney came in?

[Spectre_of_Pithecanthropus]

@GorillaMan

Is this really a common perception?

Not many Americans will admit it themselves or others, but I think it is the case. Here’s a prime example of a conversation you’re very unlikely to hear between two of my stubborn countrymen:

“Hey, wanna go out for a brew?”
“No, can’t, I’m broke.”
“Really?”
“yeah. No wait, here’s a dish of change on the dresser. Woo-hoo, I can go out for a brew!”

And this is because you can have a whole plateful of these coins of ours, and either (1) you won’t have enough to go out on, or (2) you will have it, but you would look a fool if you tried to pay for a pint with five dollars in quarters. You have, in effect, a pile of something which is technically of monetary value, yet it doesn’t enable you to do much.

The comparison I think of is Italy, who until 2001 were still using 1000 Lira notes, equivalent to about 40 US cents. They hadn’t bothered sorting out that system for many years, because they knew the Euro was coming sooner or later. But nobody felt that a €2 coin was more awkward than six or seven banknotes.

Perhaps the fact that all the neighboring countries had moved to high denomination coinage, and stopped using low value notes had something to do with it. You travel to another country, you see things done in a different way that might be better. I’ve been thinking of this issue ever since 1978 when I returned from my year’s sojourn in Germany. I’d thought it was really cool to go to the Italian restaurant and pay for dinner with a couple of coins. Even back then, it would have been impossible to do that in the States. The thing is, most Americans don’t get to travel abroad, because of the distances involved, so they never do get to see that first hand.

[Spectre_of_Pithecanthropus]

Forgot to mention, too, that Italy used to experience coin shortages, as a result of which, commercial banks often issued circulating promissory notes of, like, 100 or 50 lire. I have one that’s been endorsed!

[DocCathode]

Certainly some Americans view coins as things that go in big jars until you have enough to spend a day putting them in rolls and taking them to the bank.

I’ve never felt that way. Coins are money. I can use them to pay for things. If I want to pay the bus fare and purchase a transfer, I can use 52 nickels without a problem. If I want to take the orange line from the nearest stop to center city and I feel like paying with three hundred and seventy five pennies, I will. Back when I had a room mate, there was an occasion when I only had enough money for one fare. Then I remembered the penny jar. The conductor was not happy with my paying in pennies. But, at no time did he dispute that the penny was legal tender and that if I wanted to pay him in pennies, he had to accept.

[Spectre_of_Pithecanthropus]

@GorillaMan

This is interesting. It suggests that the US ‘currency market’ is way out of step with the rest of the world. Not least because most currency printing elsewhere in the world is something done by private companies - example

I don’t think it would make a difference here if the bills were printed privately. A private company would still have an interest in maintaining the status quo.

Doc Cathode, I certainly use coins too, when appropriate. If I have them with me, and can use a few cents to avoid breaking another dollar, I’ll do that, chiefly as a means to avoid getting more change. But you have to admit that there’s not much of anything that you can conveniently use just coins to buy. Quarters for the washing machine, seventy five cents for a bag of corn chips from a vending machine, that’s about it. Why, even to use the tire pump at a gas station usually costs a quarter or two. And that’s about as small a purchase as I can imagine.

[GorillaMan]

@Spectre of Pithecanthropus

I don’t think it would make a difference here if the bills were printed privately. A private company would still have an interest in maintaining the status quo

But they’d have no ability to do so. The government would be their customer - if they decided they wanted to stop purchasing dollar bills, then they could do so.

[rfgdxm]

@Spectre of Pithecanthropus

Besides public stubbornness, there are a couple of factors I’ve heard cited. One is that the Bureau of Printing and Engraving, which prints paper money, has successfully lobbied against eliminating the dollar bill, which would drastically cut down on their workload. Then, as for the new dollar coins, I was also told that the major armored transportation companies were reluctant to retool in order to be able to handle them. This was from someone who emailed me from the Coin Coalition’s website. That organization did indeed advocate the dollar coin, but their website is now defunct, so I can’t link to it.

Interesting theory there that the Bureau of Printing and Engraving might have lobbied to keep the dollar bill around. Of course, the US Mint would have every incentive to lobby for dollar coins. It may be a matter of who has the better lobbyists.

I’ve said it before and I’ll say it again: I believe the government has the right to dictate in this area. We didn’t vote in the monetary system in 1783, it was established by legislative fiat. Nor did we vote to go off the gold standard, or to implement the Federal Reserve System, or to take silver out of our coins in 1965. These acts were done by governmental fiat, because of economic necessity. When someone in Washington finally realizes how preposterous it is to be using coins and denominations designed around 1800 and earlier in light of 21st century prices, the dollar bill will go the way of the dodo whether the majority wants it or not. If we’re really lucky, the fractional coins will get resized downwards, too, and perhaps the penny and nickel eliminated.

Clearly, this is the sort of thing the government should just dictate. It is inevitable that some day they will have to do this and get rid of the dollar bill. Inflation continuously is eroding its value, and there will come a point the government realizes that keeping it around is just silly. I’d argue that time has come. We are already at the point that if someone pays with the lowest denomination bills, it takes 2 of the dollar bill just to buy a friggin’ Big Mac.

I think it is necessary to eliminate the dollar bill for the special reason that the public’s concept of coins has become so skewed to the idea that coins aren’t money, really, they’re just a nuisance factor in your daily life. They’re just something you get back and have to lug around, because you usually don’t use them to buy stuff.

Not true except for the smallest demonination coins. People see the dime and up as having value. The nickel is marginal. As for the penny, people now just have jars of those sitting around at home they ignore.

[Peter_Morris]

@I Love Me

I remember seeing a funny cartoon that showed a man looking at a row of vending machines. There was a candy machine, a snack machine, a soda machine and a machine with a sign that read: “Unwrinkled $1 bills, $1.25” That perfectly illustrates the stupidity and stubborness surrounding this situation.

So, if you need an unwrinkled $1 bill, how are you going to pay for it?

[Peter_Morris]

@Max Torque

The problem with the Sacagawea dollars is that people think they’re rare (for some reason), so they save them instead of spending them. I read an article a while back that said something like 700,000 or more of the first billion minted were squirreled away in sock drawers, because people were hoarding them, thinking they’re valuable or unusual.

That’s a problem? It’s less than one tenth of one percent.

[Peter_Morris]

@c_goat

When I went to a strip club in Japan, I asked one of the dancers if they would take 100 or 500 yen coins (approx $1/$5). She said no, they’d be insulted if you tried. It sucked having to give them 1000 yen bills, but they put on a good show for it and most times took it with their body parts from your face.

I imagine the Canadian strippers don’t like coins either. Plus the obvious “where does it go” problem.

I think if we got rid of the dollar bill, suddenly the $2 bill would be used a hell of a lot more, especially for strippers.

Where I come from, one girl dances while another goes around collecting donations in a beer mug. You’re usually expected to put in 50p - £1.

Then there are high class places where you are charged £10 for a private dance. Either way, there’s no sticking pound coins in G-strings.

[seosamh]

I find that it’s easier to give beggars coins rather than notes. Happily in Blighty the lowest note is a fiver [circa US$8.75?] and there’s absolutely no chance of me bunging one of those to a bloke with a dog on a bit of string displaying a sign saying “Homeless and Hungry”.

An English friend who lived there for a while advised me to carry loads of quarters with me when I visited NYC and dispense one whenever solicited. But a quarter’s only about 14p - a London beggar would knife you if you gave him that little. So: what do you do in America? (er, besides look the other way and try to ignore them like I usually do). Drop in a handful of miscellaneous coins from your pocket? Or fish out a dollar bill? A two-dollar bill? A five-dollar bill? It seems to me that a $1 coin [c. £0.57] would make an idea donation!

[seosamh]

That’s an ideal donation.

:smack:

[rfgdxm]

Update:

I did find out yesterday depending on the bank branch it can be difficult to get $1 coins. At the first branch of my bank I tried, they had not even a single roll in the vault. They commented that customers don’t want them. However, just down the road I had no problems getting a couple rolls of dollar coins at another branch. There were even some Susan B. Anthony dollar coins (a/k/a “Carter quarters”) in those. The mint was wise in changing the color to golden for the Sacky to make them easy to distinguish from quarters. And, I even had a cashier offer to exchange on old Ike dollar coin she had. There are some of those big suckers still around.

Thus, if it is typical that many banks don’t even have Sackies in the vault, I can see why they would be scarce.