[Congressional Record Volume 150, Number 103 (Thursday, July 22, 2004)]
[Senate]
[Pages S8729-S8730]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. SUNUNU (for himself, Mr. Reid, Mrs. Dole, and Mr. Harkin):
  S. 2744. A bill to authorize the minting and issuance of a 
Presidential $1 coin series; to the Committee on Banking, Housing, and 
Urban Affairs.
  Mr. SUNUNU. Mr. President, I rise today with the Senator from Nevada, 
Senator Reid, to introduce the Presidential $1 Coin Act of 2004. This 
legislation, which is modeled after the successful 50-State quarter 
program, would add the image of U.S. Presidents to the circulating 
dollar coin. I believe this bill, when enacted, will prompt more 
widespread usage of the dollar coin, earn significant funds for the 
U.S. government and spark new interest in the history of the leaders of 
our Nation.
  The United States Government currently issues a dollar coin. 
Unfortunately, many Americans don't know about the coin and most don't 
use them. In fact, the dollar coin has never lived up to its promise to 
become a primary component of the American economy. I believe as policy 
makers, it is our job to ask what this costs our economy and our 
government, why the dollar coin is not widely used, and what can be 
done to remedy it.
  With a one-dollar coin in general circulation, our economy will be 
more efficient, and our government will reap the significant benefits 
that a fully circulating coin will generate. To illustrate, millions of 
low-dollar transactions occur in our country every day. Bringing even 
the smallest efficiency to each would result in significant savings to 
the economy. For example, the vending machine industry estimates that 
the effect of a widely circulated dollar coin in its sector alone could 
be as much as $1 billion in savings: $300 million in increased sales 
and $700 million in reduced maintenance costs. Add to that the savings 
that businesses would realize by experiencing lower handling costs--
it's simply much more expensive to sort and count bills than coins--and 
one begins to get a sense of the economies that could be achieved if 
our dollar coin program were more of a success.
  In the public sector, the savings are hardly less dramatic. Informed 
estimates put the effect of a fully circulating dollar coin at as much 
as a $500 million annual infusion to the Treasury general fund. These 
funds are created by the difference between what it costs to make a 
coin or bill and what it's worth. For a dollar coin, the difference, 
which is called seigniorage, is about 80 cents. While there is no 
direct comparison for a dollar bill, as the accounting methods are 
different, the gain to the general fund is much less. Another savings 
comes from the fact that a coin can do its work for 30 years, while a 
dollar bill has a lifespan of only about 18 months before it wears out 
and needs to be replaced.
  With such clear advantages on the side of the dollar coin why doesn't 
the American public use the coin? The answers are fairly well known and 
were documented by the GAO in a 2002 report to Congress. Let me address 
some of the problems outlined by the GAO.
  First, there is the so-called ``network effect.'' This 
interdependency of demand is described by the GAO this way--
``Increasing the use of the coin is especially difficult because 
retailers will not stock the dollar coin until they see the public 
using it, the public is unlikely to use the coin until they see 
retailers stocking it, and banks and armored carriers are reluctant to 
invest in new equipment to handle the coin until there is wide demand 
for it.'' Second, there is a lack of public information about the 
savings to the government from using the dollar coin. Third, business 
users found difficulty in getting the newer ``golden'' dollar coins in 
a useable form--they are not rolled like other coins and because they 
are generally commingled with the older Susan B. Anthony dollars. 
Fourth, design mistakes made with the Susan B. Anthony dollar led many 
to confuse the coin with the quarter and spend it at a 75-cent loss. 
Finally, the most difficult problem of all, Americans prefer the dollar 
bill to the dollar coin because they can get an adequate supply of 
them, and they are readily accepted everywhere.

  The GAO summed it up with this conclusion in its 2002 report, ``. . . 
until individuals can see that the coin is widely used by others and 
that the government intends to replace the dollar bill with the dollar 
coin, they will be unlikely to use the coin in everyday transactions.''
  The bill I am introducing today will address many of these problems. 
It will do so by getting the dollar coin in people's hands and pockets. 
It will provide the information that Americans need to make rational 
decisions and it takes steps to eliminate other barriers to circulation 
of the coin. Although this legislation does not take the dollar bill 
out of circulation, it is well known that continued circulation of the 
dollar bill is expensive to businesses and consumers alike. Therefore, 
I am today writing the GAO asking that it carefully examine this issue 
and update its findings from its last comprehensive review made in 
1990.
  Now, I turn to the specifics of my legislative proposal. Beginning in 
2006, the bill would cause the images of four U.S. Presidents to appear 
on the dollar coin a year, each in the order of their service, until 
all are so honored. The reverse of the coin would feature the Statue of 
Liberty. The edge of the coin would hold important information, such as 
the date and the so-called mintmark. It is important to note that coins 
bearing the image of Sacagawea, who currently appears on the face of 
the dollar coin, will continue to be issued during the period of the 
Presidential Coin Program established by this bill. I draw my 
colleague's attention to the fact that her image will be joined by the 
images of U.S. Presidents, not displaced by them. This is only 
appropriate, especially as we celebrate the bicentennial of the Lewis 
and Clark Expedition of which she was such an important part.
  To complement the Presidential Coin Program, my bill would also 
create a new puregold bullion coin to honor presidential spouses. At 
the same time each president's image appears on the circulating dollar 
coin, the spouse's image would appear on a one-half ounce pure gold 
coin. It is my hope that together the Presidential coin and the Spouse 
coin will spark excitement and interest in the dollar coin and get it 
into circulation. These coins will appeal both to collectors and to 
investors.
  As I mentioned earlier, the Presidential Coin Program is modeled 
after the wildly successful 50-state quarter program. As all my 
colleagues know, that program has aroused new interest in coins, coin 
collecting and the history of our nation's states. Before it began, the 
U.S. Mint was producing about $400 million in quarters a year. Demand 
in the first year of the quarter program shot up to $1.2 billion in 
quarters that year. Seigniorage from the quarter halfway through the 
50-state program has surpassed all expectations, amounting to more than 
$4 billion, close to the $5 billion that was predicted for the whole 
10-year program. I believe that the Presidential Coin Program will have 
a similar effect on the dollar coin, creating interest and familiarity 
with the dollar coin and revenues for the U.S. government.
  The bill I am introducing with Senator Reid would also take other 
important steps toward getting Americans used to the dollar coin and 
removing barriers to its circulation. For example, it would cause the 
Federal Government to use the dollar coin in all its retail operations. 
Incredibly, this is not the case now. Except for the U.S. Postal 
Service, few other Federal agencies make use of the coin. Also, the 
bill would take the Susan B. Anthony dollar coin out of circulation, 
ending the problem--identified by many business owners--of commingling 
of the new and

[[Page S8730]]

old dollar coins. There would be, however, no problem for the Sacagawea 
and Presidential dollars to circulate at the same time, as they both 
would be of the attractive ``golden'' color. The bill also would cause 
the dollar coins to be available in convenient forms, including rolls 
and small bags, so that businesses can use them easily. Now, it's hard 
to get dollar coins except in pillow-sized bags, from which they must 
be counted before they can go into cash registers.
  Finally, this legislation will create a new, pure-gold bullion, one-
ounce coin with the image of the so-called ``Indian Head'' or 
``Buffalo'' nickel. Here, I must note that the design is so popular 
that when our colleague Senator Campbell, authored legislation to re-
create that design as a limited-edition silver dollar to benefit the 
National Museum of the American Indian now under construction on the 
Mall, all half-million copies allowed sold out within two weeks. This 
will be an opportunity for collectors to get a pure-gold copy of the 
coin, but it will also be an opportunity for investors to buy an 
investment-grade coin. Other countries, including the People's Republic 
of China, make this kind of pure-gold investment vehicle available to 
their citizens, but to date the U.S. Mint gold investment-grade coins 
have only been about 90 percent pure. I'm certain that with the quality 
work of the Mint and the imprimatur of the United States Government, 
this coin will be well-accepted into the market.
  Let me conclude, by saying that I believe the bill I am introducing 
today will put the dollar coin on the map and in the pockets of 
Americans. That's good for commerce and it's good government.
  Mr. REID. Mr. President, I rise today with my good friend Senator 
Sununu to cosponsor the Presidential One Dollar Coin Act of 2004. When 
enacted, this measure will provide a valuable educational tool to help 
children and adults alike learn about our presidents, will lead to 
substantial savings for consumers, and earn billions of dollars for the 
government.
  Let me begin by describing in detail how the program established by 
this legislation will work. Beginning in 2006, four presidents would be 
honored each year on dollar coins in the order of service, with their 
name, dates of service, and a number indicating the order in which they 
served on the front of the coin.
  The Statute of Liberty will appear on the reverse side of the coin, 
while the date and mintmark will appear on the edge of the coin, 
leaving room for dramatic images on the faces.
  The bill also continues the tradition that no image of a living 
president appear on coins and also seeks to address the several 
barriers to circulation that have in the past hindered more widespread 
use of the dollar coin.
  The educational benefits of this program are clear. We all know that 
Thomas Jefferson wrote the Declaration of Independence in 1776, but how 
many know the dates of his presidential service to our country? Those 
were momentous years for our young nation, and this program will put 
that kind of information in the pockets of every consumer and in the 
hands of every school child in the nation.
  This bill also will provide financial benefits to consumers and the 
government. The cost of counting and handling change is much lower than 
that of counting and handling currency. The widespread availability and 
use of a dollar coin will help lower costs for consumers in sectors of 
the economy that rely on regular low-dollar-value transactions, such as 
vending machines and transit systems.
  The Department of Treasury also estimates that the dollar coin, if in 
full circulation, would create as much as $500 million each year for 
the government. This money, which goes directly to the general fund, 
arises from the difference between the costs of making the coin and the 
amount of worth it carries in commerce. While this amount varies 
depending on a number of factors, for the Golden Dollar, it averages 
about $0.80 for each coin.
  It should be noted that the Department of Treasury estimated that the 
50 State Quarter Program would produce $2.6 billion to $5 billion in 
revenues for the government; halfway through, the program already has 
earned more than $4 billion.
  The second part of this bill would establish a program to honor 
presidential First Spouses with a nearly pure gold coin. Each coin 
would bear the likeness of a presidential spouse on one side and an 
image symbolic of the spouse's works or interests on the other. In the 
five cases in which presidents had no spouse during their term of 
office, the measure provides for an image of ``Liberty'' as was used on 
a coin during the president's term, with the reverse having an image 
related to the period of the president's term. I believe the 
presidential spouse program will build on the benefits-- both 
educational and financial--of the presidential series.
  Finally, my bill directs the U.S. Mint to produce a new, one-ounce, 
pure gold bullion coin with the famous image of the ``Indian Head'' or 
``Buffalo'' nickel. This fine looking coin is so well known and popular 
that when it was struck as a silver dollar to help finance the National 
Museum of the American Indian, all 500,000 were snapped up by consumers 
and collectors in just two weeks.
  While other countries have made coins like these, the Mint has never 
made a pure gold coin for investors and collectors, and I believe it is 
time to do so. Not only will these coins increase investment 
opportunities, they will produce earnings for the government. As my 
home state of Nevada is a principle gold producing state in the nation, 
it will also create jobs for my constituents.
  I conclude my statement by addressing an important issue that relates 
to this proposal. I understand that there are those in this body and 
elsewhere who do not wish to see the image of Sacagawea, which is now 
on the dollar coin, removed for any reason. It is their view that to do 
so shows disrespect to her and to all Native Americans. I share their 
commitment to honoring the memory of Sacagawea, which is why my bill 
provides for the continued release of Sacagawea dollar coins throughout 
the Presidential coin program and beyond. Furthermore, I believe this 
program will actually honor Sacagawea by ensuring that the dollar coin 
with her image and the images of U.S. Presidents is widely circulated 
and used by all Americans.
  Mr. President, I look forward to working with the Committee on 
Banking, Housing, and Urban Affairs and the rest of my colleagues to 
ensure this measure's review and passage.
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