On my post about the transit speed benefits of abolishing the US$1 bill, many commenters re-emphasised that $1 coins do exist. The US Mint wants to promote them, but that they are failing to catch on with the public. Cashiers encounter resistance when they give them out in change. The resulting back and forth with the customer takes far more time than it’s worth, so even a cashier with revolutionary impulses learns it’s just easier to give out dollar bills.
I wonder if a concerted high-visibility campaign in one transit-intensive US city might drive the issue to prominence. It wouldn’t even need to come from the government. Suppose, for example, that one prominent locally-based merchant in, say, San Francisco announced that from now on, they’d be giving out only $1 coins as change. This could be one of those good-corporate-citizen moves, designed to support transit patronage by putting dollar coins in people’s pockets. (I suspect they would also find that the change would result in faster service for the merchant’s customers, since coins are faster to grab and count than bills.)
Why has nobody done this by now? Was it tried, and if so, what was the resistance? It clearly would need to be a campaign, with some media buzz so that customers knew what to expect. But I have trouble imagining that the resistance would be so great in a place like the Bay Area.
Meanwhile, be the change you seek. From commenter “Calwatch”
Like one of the above posters said, the best way to show your support is to buy the coins and spend them. Luckily, the US Mint is selling them – $250 at a time – on your credit card.
Some enterprising people have used their 2% cash return credit cards and are just ordering boxes of them and wheeling them direct to the bank, thousands of them at a time, which defeats the whole purpose of the program. But, if your transit agency doesn’t accept credit cards, you can get these “tokens” at a 1-2% discount, depending on what credit card you have.
Place your orders here. (And no, I don’t get a percentage. You’ll notice I don’t even have a tip jar.)
I’m probably a strange American by many standards, but when I visited London, UK in 2002 I absolutely fell in love with the design of their pound and 2 pound coins (especially the 2 pound ones with their multi-metallic finish). As soon as I got back to the US I started making sure that I always asked for $1 coins whenever I happened to go inside a bank (which isn’t very often, but maybe once a month). I usually leave the $1 coins as tips at restaurants, since I figure servers won’t immediately rush them to the bank and take them back out of circulation.
I think if vending machines would stop having dollar changers on them and would put up a small sticker saying “accepts $1 coins” (which they do accept, already, but no one is really aware of it) then people would start to warm up to the idea of carrying dollar coins. But, unfortunately, Americans aren’t as accepting of change (pun intended) as our European counterparts.
First, if a business were to want to make the change to $1 coins only, it would have a problem with the dollar bills coming in. Many convenience stores have a bill-acceptor safe that all large bills (and excess small bills) are placed into immediately, to keep cash-on-hand low. This would be the ideal type of business to start such a policy: incoming ones are, as a matter of policy, dropped immediately.
Also, this can be sold as a theft-deterrent policy: A thief does not want his loot to be heavy. $3 in dollar coins is about an ounce, and $30 would weigh about the same as a roll of quarters. Most convenience stores limit their cashiers to $20 in ones and $30 in bills, but if the ones are heavy and awkward in large groups, the thief is looking at his take in 5s and 10s, which could still be limited to $20.
The second point is that if your card only offers 2% cashback (or “miles” or whatever), the profit on the dollar coin program is tiny: shipping on a $250 order is $4.95, and 2% back would be $5.00, for a net gain to you of $0.05 on the transaction.
Ah, but vending machines don’t often take dollar coins. The many well-maintained and recent model vending machines at my workplace, for example, won’t take them.
I also think coin design is part of it. The Susan B. Anthony coin was too small and felt too much like a quarter in your pocket. The Sacajawea coin and the current presidential coins seem to have the right size, feel, and appearance, but the images on the obverse just don’t seem coin-like. I mean, the only dollar coin I have gotten recently has Martin Van Buren on it. It looks like a fake coin on that basis alone.
I’d like to see the current coin replace images of obscure presidents and instead embrace the Lady Liberty image from the reverse as the obverse. The reverse could use the same state images as on the recent series of quarters. That would feel like a real dollar coin to me, as would simply using the image of George Washington as on the dollar bill.
People already have the option of using dollar coins if they want to, at least in transit systems that were smart and made their machines accept them. If using paper dollars adds to the cost of each transaction then why don’t you just penalize people who use them by taking a few cents off each paper dollar they put in? Then those who choose to switch to coins will be rewarded while those who wish to continue with paper can still do so but must “pay extra” for the “luxury” of not having to carry five pounds of coins with them everywhere.
You could just provide a separate machine for those who want to pay only with coins–a sort of “express” vending machine–but I have a feeling that it would be a very small minority of ticket purchasers who would choose to do so, and in that case it would be extra expense for very little benefit. I don’t think I’ve ever bought tickets from a machine using any coins at all, just cash or credit, and that’s probably the case for most people.
But in any event, I fail to see how this is such a pressing issue for transit systems that we need to even consider banning the use of paper dollars. I think it would make much more sense to focus on payment system optimization and standardization, like you’ve done in previous posts, as then more people would be able to just put money on their transit card once in a while–even at home–and then use it for whatever transit system they want, and not have to worry about feeding a machine, or at least have to worry less often.
Perhaps legislation is in order requiring that vending machines accept the coins? (There are good reasons why the old silver dollar and the 50-cent piece aren’t generally accepted; they’re huge). Start with new mechanisms, and then eventually require existing machines be upgraded.
As far as customers who don’t want dollar coins–perhaps vendors can tell ’em “its this or nothing”. After all, the definition of “legal tender” means that a creditor MUST accept it in payment of a debt or the debt is cancelled…
Interesting: you feel that the Susan B. Anthony dollar was “too small”, while the current coins “have the right size”. They are exactly the same size.
The problem was that the Anthony dollar was not easy to distinguish from a quarter, by size or appearance. Making the coins a different color seems to have largely fixed that.
The Anthony dollar was originally supposed to have a significantly different shape from a quarter, but vending machine makers complained that their machines could not easily take coins that would not roll, which necessitates coins that are round.
My mistake, the payment system optimization and standardization debate was over at Second Ave. Sagas. All you transit blogs look alike…
US Mint website says it will pay for shipping and handling for “circulating” $1 coin orders within the US. So yeah… you pocket the credit card rebate. But yeah… it’s a lot of work to earn $5.
This reminds me of the time when IKEA USA tried to implement a “no checks” policy and ended the campaign after only 3 weeks (around 2003 or 2004 I want to say but not quite sure). IKEA wanted to reduce the time it takes to process a transaction at the cash register (and therefore in theory, reduce the staffing needs) so it put up signs at its stores saying personal checks will no longer be accepted after XX date. They even printed a pamphlet educating customers on how to apply for an ATM card from customer’s bank. After about 3 months of awareness campaign in-store and 3 weeks of implementation, IKEA decided to pull the plug because too many of its customers do not have credit or ATM cards… and a good portion that do have ATM cards insisted on paying with a check.
If you’ve been on the Metro in the D.C. area recently, you’ll notice a lot of posters promoting dollar coins (along with the other not-for-profit ads). I assume Metro vending machines and Metrobus accept dollar coins but frankly I don’t use cash at all on transit, I’ve never seen a bus rider not whip out a card or bill, and the only place I’ve ever gotten dollar coins is from the post office.
Taking the SF example, perhaps this is well timed to coincide with the new $2 Muni fare?
The only way this can work is if the government mandates it. Individuals can’t really change this – and I say this as someone who sometimes requests dollar coins, finding them more convenient than bills.
The Canadian dollar coin has a different shape and doesn’t seem to have any problems in vending machines. The only problem was that it took a while for vending machines to be converted to accept the larger size. It was common for vending machines to have stickers advising that they would accept $1 (and $2) coins.
San Francisco won’t work. Last I checked, the San Francisco Bay Area Rapid Transit District does not acknowledge the existence of dollar coins and will not accept them as payment in its ticket vending machines. This despite the fact that Muni TVMs and change machines give them out. BART is just a whole little world unto itself in so many ways.
Thanks for all the comments.
Remember that any change involves pushing against the previous habit, and some of that habit is always encoded in old machines, so I would counsel courage in the face of old vending machines and old transit ticket machines that don’t take the coins.
Remember too that nobody much cares if you like the look of the coins; after all, nobody much cares if you like the look of the bills either.
I’d like to hear more from Alon Levy on why a business couldn’t lead on this.
I’m thinking it’s something that could get going in a place San Francisco, by one or more businesses that interacts with a lot of transit customers, and spread from there as the coins do.
Ah, but vending machines don’t often take dollar coins. The many well-maintained and recent model vending machines at my workplace, for example, won’t take them….
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One problem with this discussion is while nice; it’s an example of the tail trying to wag the dog. The needs of transit authorities to be able to collect small payments rapidly probably is not high on the list of lawmakers’ concerns, especially since in the US the jurisdictions running transit agency are not those printing and coining money.
The better solution is to move to electronic fare collection systems (RFID-based, smartcard-based, whatever) for most trips. For one-off trips by non-regular transit users; onboard (or platform-located) vending machines can sell single-ride tickets.
At a very minimum, transit authorities who have little cash to upgrade their onboard equipment, could still switch to a proof of payment system (enabling faster boarding and rear-boarding) by having the driver give out transfers for all cash fares; anybody with a pass or a ticket purchased elsewhere is free to use the rear door; anyone who wants to do it the old fashioned way has to board in the front, pay exact change, and keep their receipt.
This will help transit agencies run efficient operations more than hoping the greenback goes away; even if the US currency is excessively paper-based.
I do agree that the coin design is still part of the problem. When I dig into a pocketful of US $ & quarters, I have a hard time distinguishing between them, particularly in poorly lit situations. On a recent trip to Canada I ended up with a pocketful of change there, but the variation in both size & width was such that I didn’t have any confusion. Additionally, the coins seemed to be much lighter than a pocketful of US, which made hauling them around a non-issue.
There’s still one major obstacle to rear-door boarding: the rear doors themselves.
Transit agencies in North America spec their buses for narrow rear doors to prevent two-way flow.
Rear-door boarding won’t be that much faster until we see the European-style buses with all wide doors, and even a third door on non-artic buses. (Even this may be a barrier, as the U.S. in particular would frown upon more doors because they would compromise the structural integrity of a bus.)
Almost all vending machines built after 1975 can and do accept $1 coins. However, inside the machine theres a small switch that says ” accept” or ” deny”. Next time you see the company person with the machine open, ask them to flip the switch so that the machine will take your coins!
Also, it confuses me that in the era of $2 transit fares, no transit agency has machines that take $2 bills! Its evene asier to accept than coins, because bill readers have memory that can be updated (cheap machines may only take a $1 bill inserted in one direction, while better machines can accept any bill in any direction, it just depends on whats programmed).
The american public will better accept $1 coins when $4 in change is given as 2 $2 bills.
And yes, the $2 bills are still printed.
So… where are the bulk of the dollar coins that were minted? Have they been returned to the Fed? Are they sitting in bank vaults somewhere? Are they being kept by collectors?
The majority do end up in storage, followed by a good amount in circulation, especially after a law was passed requiring government machines to give them as change (post office and mass transit). A small amount is sent to dollar economies like ecuador and panama to circulate.
As EngineerScotty said, discussing whether coins or notes should be accepted is irrelevant. Smart cards, such as the Oyster card in London, have superceeded all forms of cash already. Drivers are safer as tehy carry less money, and boarding times are much quicker, with passengers simply holding their Oyster Card to a validator as they board.
The Oyster card is likely to be extended to allow payment for bike-sharing/hire and other transport services in the near future and other cities in the UK – an hopefully all UK transport cards will be linked.
Sorry I just saw this now. The reason a business can’t lead on this is that businesses are too small, and have no ability to mandate anything. Small lifestyle changes – abolition of the penny, metrication, $1 coins – face a lot of inertia with little momentum, so they can only be changed if the government requires it. Even big changes, such as universal health care, face the same hurdles, but they can generate momentum because they attempt to solve major social problems, which smaller changes don’t.
Wonderful. You’re advocating more pain-in-the-ass coins to wear a hole in my pockets. We need fewer coins, not more. Let’s start by getting rid of the worthless penny and rounding to the nearest nickel. And lets encourage more cashless transactions.
Canada abolished its $1 and $2 bills years ago. there was some complaining until everyone realized how much more convenient the $1 and $2 coins were. I was in New Orleans a couple of weeks ago and could not get over how inefficient those fare boxes were that “read” bills and printed out transfers and passes. Most passengers had to straighten out their bill and re-insert it 4 or 5 times before in was accepted. We often sat through 2 or 3 light cycles.
The mint has to abolish the bills instead of hoping people will stop using them. Their manufacture should be stopped without warning the day after the November elections so people have two years to get used to the benefit of no $1 bills, then do the $5’s.
SpyOne wrote: “vending machine makers complained that their machines could not easily take coins that would not roll, which necessitates coins that are round.”
Actually, it is perfectly possible to have coins that are not roudn but roll just fine. The only requirement is the coins be constant width. See the UK’s 20p and 50p coins, for example.
Actually, the UK has some of the best coinage for ease of identification..
* 1p and 2p are copper, circular and smooth edged
* 5p and 10p are silver, circular with milled edges
* 20p and 50p are silver, non-circular with flat edge
* £1 is heavy brass, round, with milled edges
* £2 is heavy brass/silver, round, with milled edges
* In each pair (1p/2p etc.), the more valuble coin is much larger.
(It’s taken me nearly 18 months living in Canada to get used to 10c being *smaller* than 5c. The other coins were easy)
The big thing to get dollar coins accepted is to make laundry machines take them. I got really sick of carrying a full bag of quarters before I finally insisted on having W/D in my home. When it’s $2.50/ load and $.75 to dry and you have 5 loads to do, that’s a lot of quarters. Unfortunately it seems like laundries are going to card reader systems where you have to get thier plastic card – and then you always have the mystery $.20 left over that is good for nothing….
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Do what we did in Canada. No body wanted the $1 and $2 coin but once they got used to them and after the government stopped printing the $1 and $2 bill people began to love them. No one would switch back to the bills. You have to stop printing the bills in order to get people to try the coins. Trust me, you will love them.
As an aside I hate the stupid bill readers as they take forever to read an old bill. The fare boxes on many transit lines that “read” bills take forever to read an old bill. This causes many delays in transit services, especially if there are a lot of tourists.
Granted most transit systems don’t get a lot of tourists and New York doesn’t accept bills for fare on its buses. New Orleans gets a lot of tourists on it St. Charles and Canal street lines and the delays caused by bills that can’t be read by the fare boxes are huge. Most of the operators just have people with passes hold them up and enter with out having the fare box read them to speed up the service. This does not give the system all the information it wants but it keeps the system running.
Keep up the fight to get rid of any bills under $5. It is worth it in the end.