Dollars and Sense Hearing Committee on Financial Services Us House of Representatives
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THE FUTURE OF MONEY: DOLLARS AND SENSE HEARING BEFORE THE SUBCOMMITTEE ON DOMESTIC MONETARY POLICY AND TECHNOLOGY OF THE COMMITTEE ON FINANCIAL SERVICES U.S. HOUSE OF REPRESENTATIVES ONE HUNDRED TWELFTH CONGRESS SECOND SESSION NOVEMBER 29, 2012 Printed for the use of the Committee on Financial Services Serial No. 112–162 ( U.S. GOVERNMENT PRINTING OFFICE 79–692 PDF WASHINGTON : 2013 For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800 Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001 VerDate Nov 24 2008 18:12 Mar 26, 2013 Jkt 079692 PO 00000 Frm 00001 Fmt 5011 Sfmt 5011 K:\DOCS\79692.TXT TERRI HOUSE COMMITTEE ON FINANCIAL SERVICES SPENCER BACHUS, Alabama, Chairman JEB HENSARLING, Texas, Vice Chairman BARNEY FRANK, Massachusetts, Ranking PETER T. KING, New York Member EDWARD R. ROYCE, California MAXINE WATERS, California FRANK D. LUCAS, Oklahoma CAROLYN B. MALONEY, New York RON PAUL, Texas LUIS V. GUTIERREZ, Illinois DONALD A. MANZULLO, Illinois NYDIA M. VELA´ ZQUEZ, New York WALTER B. JONES, North Carolina MELVIN L. WATT, North Carolina JUDY BIGGERT, Illinois GARY L. ACKERMAN, New York GARY G. MILLER, California BRAD SHERMAN, California SHELLEY MOORE CAPITO, West Virginia GREGORY W. MEEKS, New York SCOTT GARRETT, New Jersey MICHAEL E. CAPUANO, Massachusetts RANDY NEUGEBAUER, Texas RUBE´ N HINOJOSA, Texas PATRICK T. MCHENRY, North Carolina WM. LACY CLAY, Missouri JOHN CAMPBELL, California CAROLYN MCCARTHY, New York MICHELE BACHMANN, Minnesota JOE BACA, California KEVIN McCARTHY, California STEPHEN F. LYNCH, Massachusetts STEVAN PEARCE, New Mexico BRAD MILLER, North Carolina BILL POSEY, Florida DAVID SCOTT, Georgia MICHAEL G. FITZPATRICK, Pennsylvania AL GREEN, Texas LYNN A. WESTMORELAND, Georgia EMANUEL CLEAVER, Missouri BLAINE LUETKEMEYER, Missouri GWEN MOORE, Wisconsin BILL HUIZENGA, Michigan KEITH ELLISON, Minnesota SEAN P. DUFFY, Wisconsin ED PERLMUTTER, Colorado NAN A. S. HAYWORTH, New York JOE DONNELLY, Indiana JAMES B. RENACCI, Ohio ANDRE´ CARSON, Indiana ROBERT HURT, Virginia JAMES A. HIMES, Connecticut ROBERT J. DOLD, Illinois GARY C. PETERS, Michigan DAVID SCHWEIKERT, Arizona JOHN C. CARNEY, JR., Delaware MICHAEL G. GRIMM, New York FRANCISCO R. CANSECO, Texas STEVE STIVERS, Ohio STEPHEN LEE FINCHER, Tennessee FRANK C. GUINTA, New Hampshire JAMES H. CLINGER, Staff Director and Chief Counsel (II) VerDate Nov 24 2008 18:12 Mar 26, 2013 Jkt 079692 PO 00000 Frm 00002 Fmt 5904 Sfmt 5904 K:\DOCS\79692.TXT TERRI SUBCOMMITTEE ON DOMESTIC MONETARY POLICY AND TECHNOLOGY RON PAUL, Texas, Chairman WALTER B. JONES, North Carolina, Vice WM. LACY CLAY, Missouri, Ranking Chairman Member FRANK D. LUCAS, Oklahoma CAROLYN B. MALONEY, New York PATRICK T. MCHENRY, North Carolina GREGORY W. MEEKS, New York BLAINE LUETKEMEYER, Missouri AL GREEN, Texas BILL HUIZENGA, Michigan EMANUEL CLEAVER, Missouri NAN A. S. HAYWORTH, New York GARY C. PETERS, Michigan DAVID SCHWEIKERT, Arizona (III) VerDate Nov 24 2008 18:12 Mar 26, 2013 Jkt 079692 PO 00000 Frm 00003 Fmt 5904 Sfmt 5904 K:\DOCS\79692.TXT TERRI VerDate Nov 24 2008 18:12 Mar 26, 2013 Jkt 079692 PO 00000 Frm 00004 Fmt 5904 Sfmt 5904 K:\DOCS\79692.TXT TERRI C O N T E N T S Page Hearing held on: November 29, 2012 ........................................................................................... 1 Appendix: November 29, 2012 ........................................................................................... 35 WITNESSES THURSDAY, NOVEMBER 29, 2012 Diehl, Hon. Philip N., former Director, United States Mint ................................ 22 Lepine, Beverley, Chief Operating Officer, Royal Canadian Mint ...................... 5 Miller, James C. III, former Director, Office of Management and Budget ......... 20 Peterson, Richard A., Acting Director, United States Mint ................................. 2 St. James, Lorelei, Director, Physical Infrastructure Team, U.S. Government Accountability Office ............................................................................................ 3 Weller, Mark, Executive Director, Americans for Common Cents ...................... 23 APPENDIX Prepared statements: Diehl, Hon. Philip N. ........................................................................................ 36 Lepine, Beverley ............................................................................................... 41 Miller, James C. III .......................................................................................... 49 Peterson, Richard A. ......................................................................................... 52 St. James, Lorelei ............................................................................................. 58 Weller, Mark ..................................................................................................... 71 ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD Luetkemeyer, Hon. Blaine: Written statement of Thomas A. Schatz, President, Citizens Against Gov- ernment Waste .............................................................................................. 80 Schweikert, Hon. David: Written responses to questions submitted to Lorelei St. James .................. 85 (V) VerDate Nov 24 2008 18:12 Mar 26, 2013 Jkt 079692 PO 00000 Frm 00005 Fmt 5904 Sfmt 5904 K:\DOCS\79692.TXT TERRI VerDate Nov 24 2008 18:12 Mar 26, 2013 Jkt 079692 PO 00000 Frm 00006 Fmt 5904 Sfmt 5904 K:\DOCS\79692.TXT TERRI THE FUTURE OF MONEY: DOLLARS AND SENSE Thursday, November 29, 2012 U.S. HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON DOMESTIC MONETARY POLICY AND TECHNOLOGY, COMMITTEE ON FINANCIAL SERVICES, Washington, D.C. The subcommittee met, pursuant to notice, at 2 p.m., in room 2220, Rayburn House Office Building, Hon. David Schweikert [member of the subcommittee] presiding. Members present: Representatives Schweikert, Leutkemeyer, Huizenga; Clay, Maloney, and Green. Also present: Representative Stivers. Mr. SCHWEIKERT [presiding]. This hearing will come to order. I ask for unanimous consent that Mr. Stivers of Ohio, as a member of the Financial Services Committee, be permitted to sit with mem- bers of the Subcommittee on Domestic Monetary Policy and Tech- nology for the purposes of delivering a statement, hearing testi- mony, and questioning witnesses today. Hearing no objection, it is so ordered. We have an agreement already of a limitation of 10 minutes on each side for opening statements. Without objection, the Members’ opening statements will be made a part of the record. Let me just start with some opening comments, because in many ways I am much more interested in hearing your comments, some education for us, than hearing me go through a 5-minute hyper- bole. This is one of those issues that on the face should be almost bla- tantly simple. Out of the things we deal with here in Washington, trying to find a way to save money for this country shouldn’t be political theater. I am, in many ways, on a personal level, almost heartbroken. I accept that we have industries out there that make their living making paper for currency, people who have sort of unique sole source contracts and they use the political process to defend those. But to engage in some of the levels of political the- ater have bordered on just absurd. I really want this to be one of those where let’s deal with the truth, let’s deal with the math. What was it—the 2012 GAO study had $4.4 billion savings over 30 years. And if we actually take a look at what happened in Canada, they blew past their projections of savings. As both of us even on a bipartisan basis are trying to find ways to keep this government marginally solvent, this is maybe just one of those little grains of (1) VerDate Nov 24 2008 18:12 Mar 26, 2013 Jkt 079692 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 K:\DOCS\79692.TXT TERRI 2 sand that we need to step up and embrace if it drives us in the right direction. I now recognize Mr. Clay for an opening statement. Mr. CLAY. Thank you so much, Chairman Schweikert. Let me also thank you for conducting this hearing which is entitled, ‘‘The Future of Money.’’ This hearing will look into the cost of replacing the dollar bill with a $1 coin, which I am looking forward to hear- ing the testimony on. It is always good to have you here, but I also wanted to mention the current chairman of this subcommittee, Ron Paul, and I wanted to thank him for his long-term service to this Nation. And of course, this is one of the key issues in which he has always been interested. Hopefully, I will get to see him before we have finished our work here in the Congress. I will stop there so that we can take testimony, and again, thank you for conducting the hearing. Mr. SCHWEIKERT. Mr. Clay, you actually—maybe that is my fail- ing—for all of you who have never had the chance to really get to know Congressman Paul, he truly is one of the nicest individuals you can ever make acquaintance of. I was a little nervous when they first put me on this subcommittee, but it turned out to be one of my great joys. I know Congressman Stivers is on his way up. Do we break a little bit of protocol, let Mr. Peterson start, and then maybe we will have another opening statement? Okay. We are going to play this somewhat on the fly. Mr. Peterson, you are recognized for 5 minutes for a summary of your testimony. STATEMENT OF RICHARD A. PETERSON, ACTING DIRECTOR, UNITED STATES MINT Mr. PETERSON. Good afternoon, Mr. Chairman, Ranking Member Clay, and members of the subcommittee. I