Time and again, we hear that congress wants the government to save money. They want agencies to reduce costs and build efficiencies. How can agencies save money when members of congress introduce legislation that is counter to those goals?
Congress has been told that the U.S. Mint could save money if they standardized gold coins to 24-karat coins and silver to at least .999 fine quality. Aside from making the coins more attractive to more buyers including investors, the U.S. Mint does not have to pay more for someone to “dirty” the metals to create planchets that contain 90-percent of the metals.
Modern manufacturing methods are geared to process mined metals to create purer metals. In order for the gold or silver to be used to make the 90-percent alloy, it has to be dirtied with another metal, such as copper, before creating the planchets. While it makes the metals cheaper, the process increases the costs per planchet because of the extra work involved.
Congress exasperates this problem by not listening to the U.S. Mint and doing a virtual copy-and-paste from previous bills that says $5 gold commemoratives be made from 90-percent gold and silver dollars from 90-percent silver.
Rather than listening to the U.S. Mint, Rep. Sean Maloney (D-NY), or a non-responsive staffer in his office, did a copy-and-paste of previous commemorative bills to introduce the National Purple Heart Hall of Honor Commemorative Coin Act (H.R. 358) that calls for a 90-percent gold $5 coin and a 90-percent silver dollar.
Regardless of how one feels about the use of commemorative coins for fundraising, if congress is going to authorize a commemorative coin, why not allow the U.S. Mint to take advantage to more efficient manufacturing and stop making them dirty the metals?
It is possible that if the U.S. Mint could create commemorative coins worthy of being on par with investor grade coins, not only could they save money in the manufacturing process which could lower the costs of the coins, but they could sell more coins. If the U.S. Mint sells more coins they could collect more of the surcharges to benefit their intended causes.
If congress really cared about saving money and increasing efficiency in the government, members like Rep. Maloney will look beyond rhetoric and actually do something, no matter how simple it is.
Up next, why some members of congress should leave well enough alone!
I have a question. To my knowledge, gold especially is a soft metal. So, gold and silver coins were made 90% to make the coins stiffer for circulation when they were circulating coins prior to 1933. These coins are not made for circulation anymore. If this is the case, then why do we need to make gold and silver coins 90%?
There are two answers to why gold coins were alloyed. First is your answer: to strengthen the metals for circulation. This was more valid out west where gold circulated more freely. But most people could not afford to use or carry gold coins and gold was not used extensively. The other was to keep costs down. It was cheaper and easier at the time to mix gold and add enough copper to give a 90-percent mixture. It also meant that the purity of the gold did not have to be that great. There is evidence that most of the gold bars that the U.S. Mint assayed for gold coinage was 22-karat with the rest being whatever impurities were in the metal.
As for why they continued with the alloy mix, there is the thing people call “tradition” that perpetuates ideas even though the reasons for them do not exist. Traditions are maintained because “this is how we always have done these things.” Just because it has always been done this way doesn’t mean it’s the right way to do things. Times have changed. Technology makes it easier to assay gold and silver more efficiently and to finer levels. Why keep with the tradition if it is costing more to maintain?
Thanks for the information Scott. I agree with your views. I have said to people who want to keep traditions because things have always been that way that Jim Crow Laws were traditions, too.