If I needed one more reason why I think it is a mistake for the Federal government to take over our health care system, it was provided by a story on NPR last week.
The gist of the story was a government idea that we could save a lot of money if we stopped printing dollar bills and forced the use of a dollar coin. This was not a new concept as Susan B. Anthony and Sacagawea could testify if they were still around. The twist was that they would put an incentive into the purchase: They would allow purchase by credit card.
The unintended consequence of this well-meaning effort was the focus of the story, which introduced a new term: Airline Hacker. But first a little background.
The treasury prints millions of dollar bills a week and sadly they have a life expectancy of little more than a year. A coin however, especially now that there is no requirement that a coin have any precious metal content, can be minted cheaply and stay in circulation virtually forever. We find Roman coins on sunken ships all the time. A dollar coin has other advantages. Parking meters, for instance. The new Los Angeles meters only take quarters and dollar coins. Oh, and credit cards. And with most of them only giving 15 minutes or less for a quarter using a dollar coin makes sense.
But the public has never taken to the dollar coin. Too close in size to a quarter. Too bulky to routinely have ten or more on your person. When the government made a decision to have a substitute coin for the bulky (and expensive) silver dollar, they never quite came up with a popular substitute. Hence the incentive to get the coin into circulation by demand rather than by default (a on time race tracks and other gambling sites paid off in coins).
But what has happened is that sales never achieved the desired result. Purchase was for $250 minimum, with shipment to your residence (not a bank). But what quickly became the game was to purchase with a credit card that gave points redeemable for miles. The recipient would then march the coins to the bank and redeem them for bills. The banks accumulated literally millions of coins but were forced to put more bills into circulation while the coins stayed in their vaults.
Not only was the plan ineffective, it resulted in the printing of more bills than would have been required for normal commerce.
It doesn’t require much of a stretch to draw a healthcare analogy. More tests, more unnecessary care. More entitlements. Hmm!
If you want to do your part with the coin circulation, or if you want to become an airline hacker, the site to purchase coins is: http://catalog.usmint.gov/webapp/wcs/stores/servlet/CategoryDisplay?langId=-1&storeId=10001&catalogId=10001&identifier=8100 .
Next post I’ll explain why a friend has a problem with her husband.