Cents-Less Future Likely?
December 15, 2011
Let’s for the moment put ourselves in a country at some point in the future that has abolished the cent.
All the debates about rounding and inflation were conducted and Congress decides that the cost of the U.S. cent is just too much to absorb.
What would the abolition of the cent do to the U.S. Mint as an institution?
Back in 2000 in a period of high coin demand, the Mint proved that it could crank out 25 billion coins from its two circulation coin production facilities, Denver and Philadelphia.
If the cent is abolished some 60 percent of coin demand disappears.
If we back out the cent numbers, during 2011 the Mint has produced just 3.7 billion coins.
Does that mean in the future the Mint would have to lay off a large number of employees and perhaps close a minting facility?
The Mint has four official mints in San Francisco, Denver, Philadelphia and West Point.
Which one would close? The logic would be San Francisco first, after all, it was closed in 1955 as unnecessary. Second might be West Point where bullion coins are made.
Both, though, have powerful supporters on Capitol Hill.
The mother mint in Philadelphia should be safe if on no other grounds than tradition.
Could Denver close?
That’s a knotty problem, also, because the government wants some duplication in case of natural disaster or terrorist attack.
Those were the grounds on which the second Bureau of Engraving and Printing paper money printing plant was built in Fort Worth two decades ago.
How would you handle low coin demand and the Mint’s present infrastructure?
It is a question that will come to the fore in the not-so-distant future.
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• Strike It Rich with Pocket Change, 2nd Edition
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