Mint seeks advice

September 28, 2016

Pat Heller

The U.S. Mint is conducting a Numismatic Forum at the Federal Reserve Bank of Philadelphia on Thursday, Oct. 13. According to Tom Jurkowsky, the US Mint’s Chief of the Office of Corporate Communications, “The purpose of the event is to gather leaders and stakeholders of the numismatic community to explore ways to stimulate and revitalize the hobby. As we approach the U.S. Mint’s 225th anniversary next year, we hope this unique opportunity to examine and discuss the Mint’s past, present and future will help move all the elements of the numismatic industry forward.”

Attendance at this event is by invitation only. The Mint was expecting to send out approximately 80 invitations to the heads of significant numismatic organizations, its primary distributors, the hobby media and other significant parties that influence the collecting of coins, paper money and related items. About 50 invitees are expected to participate. I was one of those invited and plan to attend.

The stated agenda for the day is highly focused upon the Mint’s past, present and future operations. However, through unofficial channels I understand that the main purpose of the event is to consider how to promote the hobby of numismatics. Consequently, it is my hope that the agenda can include the massive amount of numismatic history in this country outside of the U.S. Mint’s activities. This more comprehensive review of American monetary history can be useful in projecting what the future of numismatics might be like.

Also, there are a number of excellent practices or proposals from other countries that can also be useful references for influencing the future of the U.S. Mint. Perhaps the most acknowledged foreign influence was The Royal Canadian Mint’s 1992 series of 25-cent pieces that honored that country’s provinces and territories. The success of this program was described in Congressional testimony by proponents of what became the U.S. Mint’s Statehood Quarter Series on legislation enacted in 1997 and production begun in 1999.

The state quarter series was perhaps the most successful U.S. Mint program ever from two different perspectives. First, for every circulating coin that the U.S. Mint strikes at a cost below face value, currently the dime through dollar denominations, that is withdrawn from circulation by someone saving it, the U.S. Mint makes a profit. Second, the introduction of this series, according to U.S. Mint market research, sparked about 100 million collectors of the series.

Now, people whose interest in numismatics was sparked by the state quarters did not automatically go on to expand their collection beyond this series. However, a small percentage did. Coin dealers across the nation, including my own business, saw a significant increase in the number of people who started with the state quarters then take an interest in collecting by earlier year U.S. silver Eagles, U.S. proof sets, type coins and other products.

The U.S. Presidential dollar series also sparked new collector interest and reinforced it in others who began with the state quarters. The current America The Beautiful Quarter® series has not had the same attraction. I suspect that is because the general public is not as familiar with the themes honored on each of the coins, nor does the public necessarily know the date sequence when these places were federally recognized (the criteria for determining the order in which this series is issued).

There are a number of steps the U.S. Mint could take that would create profits for itself and would almost certainly attract more numismatists. I intend to propose several at the Numismatic Forum. Among my suggestions will be:

1. The ability to find interesting coins in circulation at face value is a significant draw to encourage new collectors of all ages. While collecting a coin series by date and mintmark may be somewhat less popular than it was 50 years ago, the constantly changing coin designs do spark attention and interest. I propose that the U.S. Mint issue circulating half dollar and dollar coins honoring significant themes.

While I think the state quarters and U.S. Presidents are the two top concepts, perhaps other series could show nations of the world with which the U.S. government has diplomatic relations (which could also spark some international collecting interest), a historical non-political figure from each state, famous inventions from each state, state animals, a combination of state trees, birds, fish and so forth.

2. The current process for creating designs for the America The Beautiful Quarter® series does not include public input. I think it should. The U.S. Mint had some experience most recently with public design concepts received for the 2014 Baseball Hall of Fame commemorative coins.

Alternatively, for the state quarter series, the process for deriving the designs was left to the state governors, who often appointed a committee that solicited public ideas, including some from students. While the U.S. Mint may not itself want to sift through thousands of design ideas, it can at least solicit polls of which candidate designs are preferred by the population in each state.

Note that, since coins and paper money can be used to teach multiple academic subjects, soliciting feedback from students is a project that many teachers would willingly incorporate into their lesson plans. When students study coins and paper money in school, this will tend to increase the number of young numismatists.

3. Although it may not be imminent, there is some prospect of the world’s coinage systems shifting from ounce weights to metric weights, especially for precious metals issues. If it has not already done so, I advocate that the U.S. Mint investigate the practicality of issuing precious metals coinage on the basis of metric weights. Any shift to metric weights would require modification of numerous laws and regulations, but this can be done. However, any change in weight standards would also doubtless spark more collector interest.
4. The U.S. Mint should consider the issue of legal tender precious metals coinage that is legal tender on the basis of its weight and not with reference to “dollars.” This was done in South Africa when the Krugerrand was introduced in 1967. Ultimately, legal-tender coins with precious metals trade on the basis of their metal content, not their stated face value. Therefore, a series of coins that are legal tender on the basis of the value of their metal could also encourage more collectors.
5. The U.S. Mint should review proposals by Hugo Salinas Price, an American-born Mexican businessman, investor and philanthropist. Over recent decades he has proposed that Mexico issue circulating coinage containing a quantity of silver in order to help stabilize the value of that nation’s peso denomination – where Mexico is the world’s largest producer of newly mined silver. America is also one of the top 10 silver producing nations. Should the U.S. Mint introduce such coins at a cost below face value, it is entirely possible that the public may hoard such coins. If this happens, it would yield additional operating profits to the Mint as well as fostering more collectors.
6. To improve public demand for and usage of dollar coins, the U.S. Mint should advocate the elimination of the $1 paper money now produced by the U.S. Bureau of Engraving and Printing. Studies have shown that the U.S. government would derive a financial gain from such a move, but political interests have thus far forestalled any action.
7. As Canada has done, the U.S. can discontinue production of one cent coins, which now cost more than face value to strike. There is no need to take the additional step that Canada has done of withdrawing such coins from circulation. The reasons to leave existing coins in circulation are that there are already large quantities outstanding and that it would avoid the U.S. Treasury having to spend funds for the redemption program. The elimination of an existing circulating coin denomination is almost certain to encourage more collectors.
8. The U.S. Mint has a history of striking coins for many foreign countries. To the extent that such work can be done by the U.S. Mint in the future, that could enhance operating profits. If this is done, perhaps the Mint could sell to collectors sets of coins struck for other nations.

There will be much more content in my finished report to the Numismatic Forum. At the conclusion of the event, I will publish my full report submitted to the Numismatic Forum and also give my impressions of the event itself.