11 May 2010

Are Plastic Coins In Our Nation's Future?

I did an earlier post about banknotes and redesign, now for one about the coming redesign of our coins.

WSJ: Will Nickel-Free Nickels Make a Dime's Worth of Difference?
Plan to Mint Cheaper Coins Tests Mettle of Laundromats, Zinc Lobbyists

It costs the federal government up to nine cents to mint a nickel and almost two cents to make a penny. So, in addition to overhauling Big Finance, President Barack Obama wants to tinker with America's small change.

The president's plan to save money by making coins from cheaper stuff seems simple on its face. But history shows it would rekindle an emotional debate among Americans who fear changing the composition of their currency will hurt its value.

The government isn't saying which new materials it might use in coins. Most coin experts say creating non-metal coins would go over like a wooden nickel.

So far, about 10 special interest groups say they're monitoring Mr. Obama's coinage proposal. "This needs more concerted action than the mint saying, 'Let's make it cheap,"' says Ute Wartenberg Kagan, executive director of the American Numismatic Society in New York.

A native of Germany, Ms. Kagan recalled Communist-era subway tokens and money made from plastic or from metals that rust. "Toy money," she says. "Is it worthy of a country like the U.S. to have coins of this nature?"

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