COINS Act Advocates Special Interest

On July 25, 2011, Representative David Schweikert (R-AZ) introduced HR 2635, the COINS Act of 2011 to the House of Representatives. The bill proposes a switch from the dollar bill to the dollar coin, but unlike previous attempts to implement this change, the COINS Act mandates the removal of all dollar bills from circulation as well as the circulation of the Presidential dollar coin. Advocates of this act claim the switch from the dollar bill to the dollar coin would save the US $5.6 billion over thirty years…seems like a win-win situation right? Wrong.
Like most initiatives proposed in Congress, advocates of the COINS Act have alternative motives for passing this bill—the mining industry. The dollar coin’s strongest supporters, Schweikert, Senator Jon Kyl, and former Representative Jim Kolbe, also happen to represent the state of Arizona. Schwiekert’s constituency in Arizona is one of the nation’s most profitable mining states, producing over 65% of the nation’s total copper output and raking in over $9.2 billion direct and indirect funds for the state. The elements of the dollar coin, which is 88.5% copper, 6% zinc, 3.5% manganese and 2% nickel, are all mined and exported from the state of Arizona.

While these figures alone are no cause for concern, the variable prices of these metals are. The numbers put forth by the Government Accountability Office (GAO) surrounding the projected savings by the COINS Act neglect to mention how the price of the metals used to make them have increased substantially over the past ten years. The price of copper per pound hit a record high of $457 in February of this year, over a 700% increase from the price per pound in 2001, and the price continues to fluctuate but has yet to fall below $350 since January 2008. Comparatively, the price of zinc has risen by over 100% in the past ten years and nickel by over 250%.

The supporters of this bill are not looking to save American taxpayers money; they are looking to boost Arizona’s economy. This act proposes a change that would allegedly save taxpayers billions over the course of thirty years, but what has been left in the dark are the inconsistencies associated with the bill. Even without considering the costs of producing, transferring, distributing, storing and managing dollar coins, the GAO estimate shows the dollar coin would cost the government and taxpayer’s money in the first four years and would not break even for at least the next 10 years.

This bill is an obvious attempt to help the already thriving mining industry that provides Schweikert’s constituents with $2.6 billion in personal incomes, $6.15 billion in business sales and $468 million in state and local government income. By eliminating the dollar bill, Schweikert will bring a stimulus to his state at the expense of the federal government and American citizens. Thus far this bill has flown under the guise that it will help to bring the country out of debt when in reality it will do nothing but hurt the government, businesses and citizens for the next ten years. The dollar coin has been pushed before and has failed to catch on, and with good reason—they are inconvenient, expensive and an utter waste of Congress’s time.

 


Comments

  1. AnObservation says

    Hate to break it to you pal but there isn’t exactly a large mining interest in Schweikert’s district which is mostly suburban Scottsdale, Tempe, Chandler, and Phoenix. You might have an argument if Gosar or Franks were pushing this but not Schweikert.

    Additionally, while there has been an increase in metal commodity prices, there has also been an increase in paper prices.

  2. Copper. Zinc. Whatever. Apparently the zinc industry association wants to keep getting subsidized by the federal treasury. Dollar coin plus $2 bill makes financial sense.

  3. So what if the mining industry benefits from this bill? The paper industry probably benefits from the status quo. “Sound Advice”‘s article goes on an ad hominem attack on the mining industry without explaining why the bill wouldn’t still save the government money. If the government and the public saves money under the proposed bill why should we care if the mining industry gains? Just because it benefits mining doesn’t mean it is automatically bad.

    Also, if metal prices are volatile and at record highs and the bill still saves huge amounts of money when based upon current metals prices, isn’t that a good thing? The article says copper went up 700% over ten years. Well, the bill isn’t based on the prices of ten years ago. It’s based on today’s copper prices. And if copper went up that much in ten years, its pretty unlikely to keep going up that dramatically. It is more likely to hold steady or drop in value, which would actually increase the savings under this bill. And even if it did go up, it would have to go up dramatically further just to wipe out the savings under this bill let alone cost the government anything. “Sound Advice’s” article doesn’t provide any data as to what increased copper, zinc and metals prices would do to the savings under this bill either. So all it boils down to is someone saying volatility could be bad without quantifying it at all.

    The part about it costing the government money in the first few years is laughable too. The whole idea is that the coins last longer so the savings is long term. So of course there might be some costs up front. But it saves billions down the road. Notice that there is no dollar amount of these increased costs in the first four years either. Probably because they are small.

    And as Arizonans reading an Arizona based blog, why would something that helps Arizona be a bad thing for us? Especially if the claims of it being at the expense of unnamed others are dubious.

    Finally, where the hell is this article from? It’s pretty obvious that someone from Arizona didn’t write this. Is this yet another uncredited cut and paste job?

  4. Get real. The Government Acountability Office has advocated making this common sense switch to reduce waste 5 times over the past two decades. I’ll take their recommendation over some anonymously sourced blog post. This change absolutely will save the country money. Period.

  5. :::::::::::::::::::::::::::::::::::::::::::::::::::::
    This bill is an obvious attempt to help the already thriving mining industry that provides Schweikert’s constituents with $2.6 billion in personal incomes, $6.15 billion in business sales and $468 million in state and local government income.
    ::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::

    DANG! I’m MOVING to Schweikert’s district.

  6. ScottsdaleSally says

    Schweikert is focusing on common sense ways to save taxpayers. The added bonus is jobs. Whoever wrote this post is a liberal moron looking to line Barney Franks pockets. We need conservative action, not defending same old same old Washington.

    Thank you David Schweikert for pushing a solid conservative proposal.

  7. THis is an example of subversive foreigners trying to screw up AZ. Go Back To Detroit sound advice! Stay out of AZ and stop trying to plant dissension. If it works for us in AZ then I support it.
    Forget Texas, Dont mess with AZ!

  8. Phillip the Great says

    “…attempt to help the already thriving mining industry” is a pretty loaded phrase. And speaking of loaded, if Schweikert ever votes in favor of law enforcement, individual gun rights, or any defense spending you can make the same accusation: more bullets means more copper mining in Arizona.

  9. Paul Anderson says

    That’s a stretch to connect any benefits for the mining industry to the common-sense plan to use dollar coins instead of bills.

    Inflation has rendered the penny and dollar bill obsolete. Dollar coins are easier to use, faster to count and would save taxpayers a million dollars a day by not making and remaking and remaking dollar bills.

    The COINS Act would benefit everyone. Check out the Dollar Coin Alliance web page for the real scoop: .

  10. Is this really a story? I have always supported the $1 coin and found it useful. Let’s face it, in today’s economy, what do you buy for a buck? Even after you go to the 99 cent store, with tax, you are over a dollar, right?

    I don’t think David’s bill is a real budget buster, but every small part can help.

    I’m not buying into the conspiracy stuff. However, the article is short entertainment. Not quite Johnny Carson, but politically amusing. Thanks, SA.

  11. Wait… The COINS Act will save federal money *and* boost Arizona’s economy? Fantastic! That’s even better than I thought. Where do I sign up to support it? I’m not seeing a downside here, “Sound Advice.” My advice to you: Don’t hate on our state.

  12. Brandon W. says

    Looking at the recent spot price of copper I noticed the most recent data shows prices fluctuating around $3.50 per pound. If Sound Advice is interested I would be more than happy to sell a few pounds to him at his quoted rate of $470 !!! Talk about some stimulus !!!

    Note to author…Get your facts straight when writing your political hit pieces !

    • I was just looking at that – thought maybe they were quoting a different weight – 100 lb weight I guess. Yes, what I find is current $3.60 per pound – either way – still very high and not ready to go down. Additionally, should really be looking at whether the change is good for the whole country not just Arizona.

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