Thursday, May 8, 2008

Bad Money Drives Good Money Out?!



House passes bill to make coin-making cheaper
From the Associated Press
2:28 PM PDT, May 8, 2008
WASHINGTON -- The House voted for cheaper change today, the kind that would make pennies and nickels worth more than they cost to make and save the country $100 million a year.The unanimous vote advances the legislation to the Senate, but it's prospects are muddled by objections from the Bush administration and some lawmakers.The bill would require the U.S. Mint to switch from a zinc and copper penny, which costs 1.26 cents each to make, to a copper-plated steel penny, which would cost .7 cents to make, according to statistics from the Mint and Rep. Zack Space, D-Ohio, one of the measure's sponsors.It also would require nickels, now made of copper and nickel and costing 7.7 cents to make, to be made primarily of steel, which would drop the cost to make the five-cent coin below its face value.Advocates say that such actions would push back against surging metal prices and save taxpayers about $1 billion over a decade.But even the Mint opposes the House-passed measure.The legislation directs the Treasury secretary to "prescribe" -- suggest -- a new, more economical composition of the nickel and the penny. Unsaid is the Constitution's requirement that Congress have the final say.The administration, like others before, chafes at the thought that Congress still clings to that authority.Mint Director Edmund Moy said this week that the bill was "too prescriptive," in part because it does not explicitly delegate to the Treasury secretary the power to decide the new coin composition.The bill also gives the public and the metal industry too little time to weigh in on the new coin composition, he said.Sen. Wayne Allard, R-Colo., is expected to introduce another version of the legislation in the Senate.

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