Wednesday, April 4, 2012

Geithner Wants To Change Composition of Coins

In a "cost cutting measure" - Treasury Secretary Tim Geithner said a good portion of next year’s savings at the Treasury will come from changing the composition of U.S. coins to more cost-effective materials.

Plastic casino chips sounds appropriate to me.

But imagine that... the Treasury Secretary is complaining that the cost of minting coins is too expensive .. how ironic ... since he is one of the ones responsible for the inflation and resulting higher commodity prices that he is now having to deal with!

A WSJ report stated:
Treasury Secretary Tim Geithner outlined how his department will find savings, including $286 million in the next fiscal year, by changing the materials that go into coins, replacing paper with electronic communications and consolidating internal agencies.

The effort to find efficiencies is part of a broader effort by the Obama administration to reduce budget deficits by $4 trillion over the next 10 years. ...

“Currently, the costs of making the penny and the nickel are more than twice the face value of each of those coins,” Geithner said in his remarks.

The cost of making pennies and nickels are about twice the face value of the coins–2.4 cents for a penny and 11.2 cents for a nickel, the Treasury Department said earlier this month. Rising commodity prices have driven higher production costs. The Mint said it used 16,365 tons of copper, 2,311 tons of nickel and 11,844 tons of zinc to produce all coins in fiscal year 2011.

Changing the makeup of coins and improving the efficiency of currency production will save more than $75 million in the next fiscal year. In addition, the suspension of presidential dollar coin production, announced in December, will save another $50 million.

Geithner said the department is also finding savings by encouraging electronic communication instead of paper. For example, this year 77% of taxpayers will file returns online. Treasury has saved $63.9 million since 2009 by encouraging electronic filing.

Treasury is also working to consolidate the Bureau of the Public Debt and the Financial Management Service. This consolidation will save $36 million over five years, Geithner said.

Geithner said the broader deficit reduction plan outlined in the president’s 2013 budget is “sufficient to stabilize our debt as a share of the economy by 2015.”

You might want to start sorting out your coins and find some older ones too - the metal alone as a commodity is worth much more these days. Such is yet another result of the inflation that Mr. Geithner and company has set upon us all.

You can bet that Timmy and Company are also lusting after a cashless society like Sweden is planning.

That way every single transaction can be tracked and no transaction can be anonymous. Money - or transactions - can be completely controlled and your bank account can be completely shut off if you step out of line. These schemes are not borne out of the desire for "convenience", but rather the desire to control.

As an aside - I think if the Obama administration is so hot on the idea of cost cutting then perhaps they ought to tell Michelle to stay home for a week instead of gallivanting on yet another vacay... with kids, mother and secret service in tow.