Who Uses Coins Anymore?
January 19, 2011
Is it just me or have you noticed people using fewer coins lately? Even the Crystal Cafe here in Iola has finally given in and now accepts credit cards.
A case can be made that credit and debit cards will eventually drive coins out of common usage and it is just a matter of time until it happens.
However, the present U.S. coinage system is more like numismatic suicide happening in slow motion rather than an old-fashioned system of paying for goods being replaced by something new.
The government has dragged its feet for five years in coming up with new compositions for the cent and the nickel, which the Mint produces at a loss.
The Mint makes money striking dollar coins, but practically the only reason this is so is the Federal Reserve has a legal mandate to support the denomination. Call it numismatic quantitative easing. There is a surplus of over a billion coins the public doesn’t want.
The half dollar is not used. Most people are stopped cold if they happen to run across one.
The dime and the quarter are the only two denominations that are both currently necessary for commerce and that the Mint can strike at a profit.
How much longer will these two coins remain useful when their purchasing power has been so drastically reduced?
A day might come soon when the public will accept rounding to the nearest quarter just so the transaction won’t drag on too long in the check-out line.
Debit and credit cards might win in the end, but will it be a fair fight with our present U.S. coinage system?
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