March 2020 Numismatic Legislation Review
As part of an action-filled month, there was one numismatic-related bill introduced in congress. Rep. Andy Barr (R-KY) introduced the 1921 Silver Dollar Coin Anniversary Act (H.R. 6192) to allow the U.S. Mint to strike tributes to the 1921 Morgan and Peace Dollars.
H.R. 6192 is a replacement for the 1921 Silver Dollar Commemorative Coin Act (H.R. 3757). That bill will die in committee because two commemorative coin bills are already the law. The Christa McAuliffe Commemorative Coin Act of 2019 (Public Law No. 116-65) and the National Law Enforcement Museum Commemorative Coin Act (as part of Public Law No. 116-94) will appear in 2021.
The new bill is different in that it is not a commemorative coin bill. It was introduced is a bullion bill, which means that the government will keep all of the seigniorage. It would have been nice to have a commemorative bill that would raise money for the ANA.
The bill also does not have an end date. If passed, the U.S. Mint can strike bullion Morgan and Peace silver dollars starting in 2021 and into eternity. Although reports claim that the U.S. Mint “does not currently have any intention of creating an ongoing program and issuing coins after 2021,” does not mean they will not change their mind.
The only change I would recommend is to amend the bill to be like the 24-karat gold bullion bill. Allow the U.S. Mint to use the Morgan and Peace dollar designs the first year but allow the U.S. Mint to come up with new designs every year. Consider how much more successful the 2017 Centennial Coins would have been if they were struck in silver.
H.R. 6192: 1921 Silver Dollar Coin Anniversary Act
Cash is Still King
The question of paper versus plastic is answered every time we go to pay for a purchase. Up until this year, you can perform an Internet search and find many articles and blog postings about how the use of credit cards and electronic payment systems will make the U.S. Mint and the Bureau of Engraving and Printing obsolete.
Many of those articles were written during allegedly good times when credit was easier to obtain with high credit lines and low monthly payments. Then we had a credit crisis caused by many things including our proclivity to take out the credit card for purchases. The credit market changed and most of us who had many credit cards are down to a few whether by choice or otherwise. Now, it appears that credit purchases are down and cash is king once again.
A new report says that while credit card payments have either stayed even, as in the case with American Express, or declines as in the case with Visa and MasterCard, the use of cash and debit cards have risen.
Consumer spending is up 2.2-percent this year with credit card transactions being down 1.2-percent. Debit card purchases is up 15-percent with the rest of the increase being cash. With the new credit card protection law allowing merchants to give a discount for using cash, small retailers have been starting to offer discounts while larger chains are discussing their next move in this area.
Are we really leading to an all-plastic economy? Both the U.S. Mint and the Bureau of Engraving and Printing are reporting higher production numbers for 2010 than they did in 2009. Discounting the striking of half-dollars and dollar coins, the U.S. Mint’s production is up almost 30-percent. Although the statistics from the BEP are not fully available, BEP Commissioner Larry Felix testified to the House Subcommittee on Domestic Monetary Policy and Technology that production is up from 2009.
For those of us who collect coins or notes, whether they are modern or classic, it is good to know that the U.S. Mint and the BEP will continue to produce products to feed our collecting habit. And that is something to be thankful for heading into this holiday season.
Support the Penny Harvest
The Coin Collector’s Blog is a proud supporter of Common Cents®, an educational, not-for-profit organization, which specializes in creating and managing service-learning programs for young people. Their most popular and best known program is the . It is largest child philanthropy program in the United States.
This past fiscal year, Common Cents reported that “hundreds of thousands of students who participated in the Penny Harvest program last year, collecting and giving away $756,273.19 to charities.” For those who think the lowly copper-coated zinc cent is worthless, that is over 75 million coins collected by students in Metropolitan New York City, the New York Capital Region, Ohio, Florida, and Seattle to benefit causes around the world. In addition to charitable giving, the many of the students involved in the Penny Harvest participated in “service-learning projects, such as block clean-ups and literacy programs.”
I became interested in Common Cents when the Penny Harvest Field was set up in Rockefeller Center and featured on NBC Nightly News in 2007. Although I was unable to visit New York City to see this in person, it was quite a site on television. A year later after reading their annual report and talking with a teacher who was involved with the Penny Harvest, I made Common Cents the Official Charity of the Coin Collector’s Blog.
To better understand how lives can be touched not only by those receiving the help but by those working to provide the help, I found this video of Savion, a student from P.S. 163 Alfred E. Smith School, a multi-cultural school located on Manhattan’s upper west side.
As we approach the holiday season, I am asking my readers to please consider helping Common Cents with a donation to help them continue with the Penny Harvest. Also, if you live in an area where the Penny Harvest is not located, please consider getting involved and maybe start a Penny Harvest to your area. In fact, sign up for their mailing list and when you answer question 3 at the bottom of the page, click on at least one of the first three options and see if we can get the Penny Harvest working in more locations!
Charity is good for the soul!
Charity supported by children is not only good for the soul but a sign of a positive future for this nation.
Please support Common Cents and the Penny Harvest.
Videos courtesy of Common Cents.
Lame Duck Prognostications
Recently, I met someone familiar with the internal workings of congress. After talking about the election, I asked about the coin-related bills that were still in congress waiting for action in the lame duck session. I passed along the link to my post about Coin Legislation in the 111th Congress and asked if any of the bills passed the House of Representatives and in a Senate committee had the chance of being voted on. I was given the following report:
Bills Passed by the House and Referred to the Senate
Three bills have passed the House and sent to the Senate for their action. These bills are currently waiting for action in the Committee on Banking, Housing, and Urban Affairs. All three bills are expected to pass with the following modifications:
- Mother’s Day Centennial Commemorative Coin Act will pass without modification.
- American Eagle Palladium Bullion Coin Act of 2010 will be modified to allow the U.S. Mint to begin striking palladium coins in 2012.
- Coin Modernization, Oversight, and Continuity Act of 2010 will pass with the possible modification that the report is due to congress within 15 days of the end of the 2012 fiscal year.
Bills that are modified are required to be reconciled by a conference committee or just accepted by the House. It is expected that the House will accept the modifications by unanimous consent and will be signed by the president.
Bills Introduced in the House of Representatives
There are 13 commemorative coin bills waiting for action in the House Subcommittee on Domestic Monetary Policy and Technology. None of the bills are expected to receive attention and will “die in committee” at the adjournment of the 111th Congress.
In addition to the commemorative bills, there are three other bills related to collectors and investors that are likely to see some action:
- Free Competition in Currency Act of 2009 was introduced by Ron Paul (R-TX) and referred to the Subcommittee on Commercial and Administrative Law. The basic provisions of this bill calls for the elimination of all taxes on the sale and transfer of bullion and coins. It also changes the law to allow precious metals to be used as coins or a medium of exchange. As the future chairman of the Domestic Monetary Policy and Technology Subcommittee, Paul may not push this bill. Rather, he will wait until the 112th congress to have it assigned to his subcommittee so he can control the outcome. This bill is unlikely to pass in the Democratic-controlled lame duck congress.
- Coin and Precious Metal Disclosure Act was introduced by Anthony D. Weiner (D-NY) and referred to the House Committee on Energy and Commerce. This bill is referred to as the Goldline Act since Rep. Weiner has targeted Goldline in his commentary regarding this bill. Because of the controversial nature of this bill and the potential for side effects that could hurt other industries, it is unlikely that this bill will be brought up again in committee.
- Small Business Paperwork Mandate Elimination Act was introduced by Dan Lungren (R-CA) and referred to the House Committee on Ways and Means. This is the bill that will remove the requirement to report all goods and services purchased in excess of $600 with an IRS 1099 form beginning in 2012 that was part of the health care reform legislation. Almost everyone in almost every industry is in favor of this bill’s passage. Sen. Mike Johanns (R-NE) has introduced S.3578 as a companion bill in the Senate. Although this bill has bipartisan support and should pass with few issues, there is a concern that more conservative members will create a problem when demanding that revenues lost by this measure be made up elsewhere. Revenue enhancements (read: taxes) will be deferred to the 112th congress allowing this bill to pass. The president is expected to sign this bill into law.
Bills Introduced in the Senate
There are 11 commemorative coin bills waiting for action in the Senate Committee on Banking, Housing, and Urban Affairs. Only the Mother’s Day Centennial Commemorative Coin Act introduced by John D. Rockefeller (D-WV) as S.1012 may receive some consideration. Sources report that this may be done as a favor by outgoing Chairman Christopher Dodd (D-CT) for Sen. Rockefeller. If this bill is voted on by the Senate, it is unlikely to be considered in the House.
No further bills are expected to be introduced.
This will end the 111th Congress. It will certainly make for an interesting study for future historians. But for today, we can only wonder what the 112th Congress will have in store for collectors.
Ron Paul to Chair Mint Oversight Subcommittee
Now that the dust has settled from the November 2 mid-term elections, there is a consequence for collectors of United States coins: Rep. Ron Paul (R-TX) will be the chairman of the Subcommittee on Domestic Monetary Policy and Technology, the subcommittee with oversight authority over the U.S. Mint.
Prior to the election, Rep. Melvin Watt (D-NC) was chairman of the subcommittee and Rep. Mike Castle (R-DE) was the ranking member. With the 60-seat gain by the Republican party, they will change the makeup of committees. Since Castle lost his primary race, the Republican leadership in the 112th congress will likely elevate Rep. Paul to be the chairman of the committee. It is likely Rep. Watt will become the Ranking Member.
While there will be other changes in the governing structure in the various committees that provide oversight to the U.S. Mint, this subcommittee provides the direct oversight where bills on coins, commemoratives, and medals are first assigned. Considering the legislative history of its new potential chairman, it is likely that it will be an interesting session.
To say that Ron Paul has an economic agenda that differs from current policies and similar policies that have existed since 1964 would be an understatement. Paul wants to go back to a precious metals-based standard specifically using gold and silver. While it is recognized that a precious metals standard would make it difficult to manipulate currency markets, it has its limitations to be able to supply a demand for money.
Although Paul’s policy preferences are something to be debated, policies dealing with the operation and production of the U.S. Mint is not the place for that discussion. During the hearing of “The State of U.S. Coins and Currency” held on July 20, 2010, Paul’s opening statement was more about not about his view of monetary policy. In his opening statement, Paul commented on the prosecution of Bernard von NotHaus by saying, “the federal government insists on printing trillions of dollars out of thin air, and prosecuting individuals who attempt to create precious metal currencies to compete with the devalued US dollar.”
Later during the same hearing there was a discussion regarding the U.S. Mint not issuing the 2009 American Silver Eagle Proof coins. Paul asked U.S. Mint Director Ed Moy why the U.S. Mint could not just strike 2009 Proof American Silver Eagles. Moy rightfully pointed out that doing so was not legal (see 31 U.S.C. § 5112(d)(1)).
In fact, during the questioning of Director Moy, it was as if Paul did not understand that the “Mint Does What It’s Told by Law to Do.” Although Paul said, “It is a shame that Congress has already unconstitutionally delegated its coinage authority to the Treasury Department,” he underestimates congress’s role as outlined in Title 31 of the United States Code.
I am not encouraged by Ron Paul’s potential elevation as chair of this subcommittee. Rather than provide oversight to an already over-regulated agency, Paul will use his position as a platform for his policy preferences. Oversight of the U.S. Mint is not the place to promote these policies. If Rep. Paul wants to promote his policy preference, I suggest he chooses another committee for which to serve or learn what the U.S. Mint actually does before accepting the role as chairman of its oversight committee.
Brief History of Crane & Co. (CORRECTED)
Since 1879, Crane & Co. has been the exclusive currency paper supplier to the Bureau of Engraving and Printing. The company was founded in 1801 by Zenas Crane. Crane, the fourth son of Liberty Paper Mill’s owner Stephen Crane, knew he would not be able to take over the family visit. After learning about paper making, Zenas moved to Dalton, Massachusetts and founded his own mill.
According to CNN Money, Crane & Co. became the supplier of currency paper to the BEP by applying business practices that would not be tolerated today* outbidding other potential bidders:
In May 1879, Zenas’ son, W. Murray Crane was in Washington, D.C., and heard that the Treasury Department was unhappy with their paper currency supplier and was accepting bids for the business.
After all the bids were submitted, Murray learned the amount of the lowest bid and raced back to his hotel room to prepare a second, much lower bid, says Crane historian Peter Hopkins. When the other bidders heard about Crane’s plan they locked him in his room, according to the story, but he managed to slip out and get his bid in just in time. Ever since, Crane & Co. has manufactured the U.S. currency paper.
Today, Crane & Co. is providing the currency paper for the new $100 note with technical features not found on any other note in the world. Interestingly, Crane & Co. is owned and managed by the eighth generation of the Crane family and continues to survive using its currency paper and stationary business.
The following video interviewing Crane & Co. CEO Charles Kittredge about the company’s history and the current economic climate for paper appeared in the Small Business Section of CNNMoney.com:
* CORRECTION: I was contacted by Peter Hopkins, who was quoted in the CNN story. He pointed out to me that while the CNN story may have made the practice of submitting a last minute bid was not exactly ethical, the telegram Murray Crane sent back to Crane & Co. noted that up to three bids could be submitted. Thus, Murray Crane was acting in accordance with the rules while his competitors were not acting professionally. I apologize for the error and corrected the story.
Video courtesy of CNN Money.com
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