The shortage has caused some to argue
that we should do away with some or all coins, but I don’t believe the United States should give in to the push to become a cashless society
, like Finland, Sweden or China.
During the early days of the pandemic, people — including myself — were concerned that touching things like groceries, the mail, packages and money could lead to infections. Even I bleached and sprayed items purchased at the supermarket and stopped using cash and coins. As a result, the number of cashless transactions has skyrocketed
during the pandemic.
But that increase poses a potential danger to the economy. Cashless transactions depend on secure computers and robust communication networks, all of which require a steady supply of electricity. Plus, they need impenetrable networks that cannot be compromised by hackers and criminals. If either of those elements are compromised and we don’t have low-tech options, like coins and cash, to fall back on, the American financial system could be in serious trouble.
During disasters, things fail. Covid-19 has shown us that the more steps in a process, the more likely things are to fail. Low-tech items don’t depend on electricity or computers, and they are exactly the type of items we should be promoting — not eliminating — to ensure national security during uncertain times.
Getting rid of coins is also problematic for the poor and those with bad credit. There are still large swaths of people in the United States who are unbanked and don’t have easy access to credit or debit cards. The Federal Deposit Insurance Corporation, or FDIC, which insures the nation’s banks, periodically checks to see who doesn’t use banks. Its most recent survey
showed more than one in four households (26.9%) are either unbanked or underbanked. By turning into a cashless society, we would further alienate this substantial group, which comprises those who can least afford to be left out.
And, of course, there are privacy issues. Every cashless transaction is tracked, enabling banks and financial service companies to build up a complete profile of your purchases. This profile hones businesses’ ability to micro-target customers and enables intrusive government surveillance. Many people do not want a public record of their spending at places like bars, casinos or marijuana dispensaries. There are also other transactions people want hidden. For example, I am supposed to be on a healthy food-only diet. I really don’t want my wife to know how often I stop for donuts.
I have also previously argued
for keeping coins and cash
for both economic and social justice reasons.
Yes, the penny and nickel cost more
to make than they are worth. But even with this state of affairs, the US Mint still made over $300 million in net income
last year on just minting circulating coins. It did this since the cost of making dimes and quarters is well below their face value.
Finally, our society has been undergoing a period of intense retrospection through the Black Lives Matter movement. Some public protests have demanded the removal of national symbols. Statues have been taken down and buildings have been renamed. A statue in a forgotten corner of the park is not nearly as potent a symbol as the images on the currency people use to buy their food, drink and clothes.
US coins and cash today primarily bear the images of long dead White men, like Abraham Lincoln, George Washington, Thomas Jefferson and Benjamin Franklin. We have just two circulating coins with images other than White men: the Susan B. Anthony dollar coin, which was minted
from 1979 to 1981 and again in 1999; and the gold Sacagawea dollar coin, which has been minted
since 2000. However, these dollar coins are rarely used by the public. We have had only one piece of paper currency with a woman and you have likely never used it. It was a $1 bill printed only in 1886 and 1891 that bore the image of Martha Washington
, wife of the first president.
The vast number of commemorative coins
released each year shows it is relatively easy to create new images, which can rapidly be put into circulating coin production.
Now is the time for the Mint to make a statement. There is no clearer way to say Black Lives Matter than by putting a Black person on our coins or currency. It’s a simple yet long overdue step that not only would help the Mint get people interested in coins again, but show support for today’s calls for social justice.