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Senator Coburn’s “Back in Black” Deficit Reduction Measure Calls for Dollar Coin Transition Dollar

Press Release
4 min read
Chris Fuscus, AI Business Analytics

For Immediate Release
July 18, 2011

Washington, DC – As the debt ceiling debate rages on, Senator Tom Coburn (R-OK) today released “Back in Black,” a massive deficit reduction plan to cut $9 trillion from the federal budget over the next 10 years. Included as part of the package, which the Senator considers the basis for a bipartisan budget compromise, is a move to eliminate the dollar bill in favor of the dollar coin. The proposal estimates that transitioning to a dollar coin would save the government $2.04 billion over a ten-year period.

“We fully support Senator Coburn’s efforts to reduce the deficit by finally eliminating the wasteful $1 bill,” said Shawn Smeallie of the Dollar Coin Alliance. “This is the type of common sense solution Americans are looking for from our elected officials – we’ll do everything we can to help make the dollar coin transition the law of the land.”

The Coburn Plan recommends:

Replace the $1 Bill With $1 Coin
The Treasury Department should phase out use of the $1 bill and replace it with the $1 coin. Paper-based currencies wear out faster than coins, and so cost taxpayers more in the long run. According to GAO, starting in the 1980’s, “Over the last 47 years, Australia, Canada, France, Japan, the Netherlands, New Zealand, Norway, Russia, Spain, and the UK, among others, have replaced lower-denomination notes with coins.”
GAO also estimates that over a 30-year period, the average annual savings would be approximately $184 million.
Estimated Ten-Year Savings: $2.04 Billion

The proposal from Senator Coburn follows a recent report by the Government Accountability Office estimating billions in government savings with a transition to the dollar coin. The report, “Replacing the $1 Note with a $1 Coin Would Provide a Financial Benefit to the Government,” strongly recommends the replacement of the dollar bill with a dollar coin and estimated $5.5 billion in government savings over a 30-year period. Depending on certain assumptions in their analysis, this savings could be as high as $11.1 billion. Estimates of average annual cost savings have ranged from nearly $200 million to more than $500 million per year.

The Dollar Coin Alliance is a coalition of American small businesses, budget watchdogs, trade associations and transit agencies with a singular focus of moving the United States toward an economical, environmentally friendly $1 coin.

  • If the Administration’s concern is reducing waste in our $1 currency supply, the smart solution is to eliminate the antiquated $1 bill. As noted in repeated studies over two decades by the nonpartisan Government Accountability Office (GAO), the continued production of $1 notes costs taxpayers at least $5.5 billion over 30 years.
  • The current $1 coin program actually reduces the federal deficit by nearly $300 million each year. According to the U.S. Mint’s 2010 Annual Report, the $1 coin program made a net profit of $283 million, all of which was transferred to the Treasury General Fund to reduce government debt.
  • This is a transparently political push by the Federal Reserve and the Treasury Department. Both have previously urged Congress to eliminate the $1 coin program in order to maintain profits generated by the continued production of $1 bills. Having failed, Treasury has now unilaterally acted to stop $1 coin production, usurping Congress’ authority in U.S. currency and coin matters under the Presidential Dollar Coin Act.
  • In September, Congressman David Schweikert introduced the bipartisan Currency Optimization, Innovation and National Savings (COINS) Act (H.R. 2977), a bill to modernize the nation’s currency by eliminating the $1 note – a change virtually every country in the world has made in the past several decades to reduce waste.

For more information, or to get involved, please visit www.DollarCoinAlliance.org.

Dollar Coin Alliance Mission Statement

The Dollar Coin Alliance is dedicated to saving American taxpayers billions of dollars by transitioning to a one dollar coin. We are focused on educating taxpayers and policy-makers about the benefits of increasing dollar coin circulation. We believe the dollar coin will yield cost savings to American businesses and consumers, smaller environmental impact, assistance to the visually impaired and improved national commerce.

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