5¢ coin now costs over 10¢ to mint
This coin isn’t pulling its weight.
It now costs more than a dime to mint a nickel, prompting Congressional action from lawmakers who say the boondoggle epitomizes wasteful spending in Washington.
The five gram five cent piece now mostly consists of copper and costs 10.4 cents to produce, according to the US Mint’s 2022 Biennial Report to Congress, released last week.
Quarters and dimes still cost less than they are worth, but profit margins on the more valuable coins have also recently shrunk by about 29 to 35% over the past two years, the report said.
Coin use had been decreasing for years but deposits to the Federal Reserve Banks plummeted by nearly 50% since April 2020 as much of the nation went into COVID-19 lockdown and very few coins exchanged hands.
Widespread digitized payment options for services like public transportation, vending machines and laundry combined with soaring inflation had also reduced the need to mint as many low denomination coins.
Mint officials have now proposed using a 80/20 copper to nickel ratio instead of the current 75/25 ratio on nickels, dimes, quarters and 50 cent pieces to save taxpayers $12 million a year. Other compositions could save more than $50 million, officials said.
The report prompted lawmakers to reintroduce the Coin Metal Modification Authorization and Cost Savings Act on Thursday. The 2020 bill had previously stalled on Capitol Hill in favor of more serious pandemic-related measures.
Nickels are currently composed of 75% copper, a ratio that lawmakers want to increase to save money. Shutterstock
“It’s absolute non-cents that American taxpayers spend ten cents to make just one nickel,” bill co-sponsor Sen. Joni Ernst (R – Iowa) joked in a statement.
“Only Washington could lose money making money. This commonsense, bipartisan effort will modify the composition of certain coins to reduce costs while allowing for a seamless transition into circulation,” Ernst said.
“A penny saved is a penny not borrowed.”
How’d you like a nice stack of these bad boys in your pocket? Shutterstock
The nickel isn’t the only low denomination coin that is punching well below its weight. Pennies now cost $2.72 to make, and billions are manufactured every year. Neither coin has turned the treasury a profit since 2006.
A poll conducted last year found that 58% of US voters believed production of the penny should be abolished, but legislative efforts to kill the penny have been met with resistance since the 90s.
Never before in US history have coins been less valuable. In 1857, officials did away with the half-cent coin, which was then worth about $0.14 in today’s money, according to an NPR report.
Source: New York Post
