“We have so many dollar coins, it makes sense to find a way to get them into circulation,” Bernanke said. “It will also help reduce the storage requirements to hold these coins.”
Bernanke, who has been both complemented and reviled over the Fed’s handling of the Great Recession, said that now that the economy was more solid, he would turn his attention to doing what he can for the federal government. Citing the GAO report that estimated the federal government could save at least $4.4 billion by using coins rather than money, Bernanke will use his power as Chairman of the Fed to determine the independent bank’s policy over circulating money.
“Not only will this keep our facilities busy but it will help the U.S. Mint maintain and increase its profitability,” said Richard A. Pederson, Acting Director of the U.S. Mint. “The reduction of dollar coins previous ordered by [then Treasury Secretary Tim] Geithner really hurt our bottom line. It significantly lowered our seigniorage and the size of our deposit into our Public Enterprise Fun.”
Pederson assured Bernanke that the U.S. Mint will be able to meet the new demand for circulating dollar coins.
Director of the Bureau of Engraving and Printing Larry Felinks said that this change will help increase productivity in other areas of their operation. “Printing of the one dollar note is over 50-percent of our production. This reduction will allow us to concentrate on other projects including trying to figure out why we have not been able to produce $100 notes.”
“Obviously, we are not happy about this,” said Violet “Blue” Crane, family spokesperson for the Sandhill Crane Company who manufactures the paper for the Bureau of Engraving and Printing. “Manufacturing paper for the one dollar bill was half of our business and gave us the most profit since that paper did not have to include anti-counterfeiting features.”
The U.S. Secret Service declined to comment for this story and any other story they were asked about.
Bernanke, sitting in his office obviously pleased with his new policy, also understood the impact of his decision on the numismatic industry. Leaning back in his chair, Bernanke closed with, “Collectors of United States coins will remember April 1, 2013 as the day I gave their dollar coin collection more meaning.”
Native American Dollar image courtesy of the U.S. Mint.