Could a U.S. lawmaker actually make sense from cents?

Finally, some federal legislation that actually makes sense … and cents … at the same time.

U.S. Sen. Joni Ernst, a Republican from the neighboring state directly south of us, is sponsoring a bill called the “Currency Evolution Now to Save,” or “CENTS” because you know, any good piece of legislation contains a clever acronym.

Essentially, this legislation would give the U.S. Mint the authority to change our change in terms of metals used to make them. Under provisions of the bill, any changes would simply have to reduce the cost to produce the coin while not affecting its diameter, weight, and functionality.

Over the course of the last several years, it has started to cost more to make the coins than they are actually worth. After a 12 percent increase in 2018, it now costs more than 2 cents (2.6 to be exact) to produce a penny. And a nickel is even worse, comparing actual value to production costs. Following a similar 12 percent production cost increase last year, the nickel went from 6.6 cents to 7.53 to make. Dimes (3.73 cents) and quarters (8.87) remain well below their value compared to production costs despite about 8 percent increases.

So essentially, Ernst wants to allow the U.S. Mint officials to use cheaper metals to produce those nickels and pennies. She estimates over a 10-year period, the changes would net $150 million in savings.

While $15 million a year is a grain of sand on the beach in terms of the federal budget, it is still $15 million and if using cheaper metals doesn’t affect the coin’s functionality, it seems like a no-brainer to make the change.

With that said, there may be even a better solution to the coin dilemma lurking in our nation’s history. Using cheaper metals may result in some savings, but in the end, it will still cost more to make a penny than the penny is actual worth, and the same will probably hold true for a while with the nickel.

So instead of reducing the production costs of those two pricey coins, why not eliminate them entirely and make a new coin?

In 1851, the U.S. Coin did half of that and released a new coin right in the middle of the nickel and penny: a three-cent coin. The new coin was released in conjunction with reduced postage rates that resulted in a three-cent stamp, thus simplifying that transaction.

Obviously, postage rates changed and the three-cent coin faded out of the public light within about 20 years.

But could it make a return in the 21st century at the expense of the nickel and penny? Why not?

Theoretically speaking, both coins could be discontinued but the execution of that would be difficult for retailers.

Obviously, transactions that ended with 3, 6, or 9-cent purchases would be easy for the three-cent coin to handle. Anything at 0 or 10 cents would be covered by the dime, so we have half of the potential transactions easily covered.

This where it gets tricky.

If you have a $5.02 purchase, you could use four three-cent pieces and get a dime back. Or, if you paid with $6, you get three quarters, two dimes, and one three-cent piece in return. That’s not too bad. But if it’s $5.32 and your change is 68-cents, you’re looking at two quarters and half a dozen of those wonderful three-cent pieces.

Ugh. Sounds complicated. And it gets worse … 21 cents would require seven 3-cent pieces, or you get 79-cents back, which would be three 3-cent pieces, two quarters and two dimes.

Cashiers who can’t count change would have their heads explode and millions of cash registers would have to be reprogrammed to help decode change for the mathematically challenged.

But, it could be done. And if legislators wanted to ease into it, they could still produce a greatly reduced number of pennies each year to help facilitate the change and still reap significant changes.

Incidentally, if you happen to come upon one of those three-cent coins from the 19th century, an 1851 proof sold for $172,500 in 2012. That definitely made a lot of cents.

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