Treasury Waste: Coins Cost More to Make Than Their Face Value
Here is a typical example of how inefficient government can be; the United States Treasury has for years spent more money on the cost of producing pennies and nickels than their face value, which means hundreds of millions of coins have been sold well below cost.
Incredibly, the government has knowingly done this for at least eight years and actually documented the egregious waste in several reports though nothing has been done to stop it. In fact, both the Treasury and the Bureau of the Mint have extensive documentation on this yet it continues today. If a private business operated in this manner, it would surely go broke in no time.
However, the government has the privilege of using American taxpayers as a cash cow even when senseless business decisions like this are the norm. Just check out the language in this 2012 Treasury Inspector General report, brought to Judicial Watch’s attention by a lawyer and investigative reporter dedicated to exposing government wrongdoing. Buried on the second-to-last page of the 2-year-old document is the admission that “challenges also exist with coin production.”
It goes on: “In recent years, the Mint reported that the cost of producing penny and nickel coins were double their face value and that metal prices have caused the production costs to be higher than the coins’ face value for the past 6 years.” The audit also mentions the boondoggle surrounding the suspended dollar coins. Low demand and the high cost to store the excess supplies led the Treasury to stop making them yet in fiscal year 2011 production costs of the unpopular dollar coin were about a fifth of its value, according to the report.
The Treasury, like many other bloated government agencies, is well known for its transgressions not to mention wasting public funds. Earlier this year Judicial Watch reported on yet another example, that the Treasury paid an upscale public relations company an astounding $112.7 million to actually promote money. The Treasury Department’s Bureau of Engraving and Printing (BEP) doled out the cash to educate the public about the redesign of the $100, $50, $20, $10 and $5 notes. It was part of a public education and awareness program intended to promote a seamless introduction of new currency into global commerce.
Here’s what American taxpayers got in the fleecing to promote an established product—U.S. currency—that hardly needs it; education materials on the new bills in 18 foreign languages, awareness programs aimed at domestic and Latin American markets, stakeholder and media outreach and an interactive website. There was also a special focus on the gaming industry and international markets, which didn’t come cheap. A federal audit found that the promotion campaign was grossly mismanaged and the Treasury tried to hide records associated with the deal.
JW also sued to force the Treasury to release documents involving the scandalous bank bailouts that stuck it to American taxpayers to the tune of hundreds of billions of dollars. Last year JW reported that the Treasury awarded executives at companies bailed out by the government under the $700 billion Troubled Asset Relief Program (TARP) millions of dollars in raises, even after Congress passed a law forbidding it. Combined the government-rescued firms—including General Motors Corp and American International Group (AIG)—got an astounding $135 billion from Uncle Sam yet the Treasury approved 18 raises totaling $6.2 million for the executives responsible for the companies’ failures.