So picture a road paved entirely with shiny golden
coins just stretching all the way from Los Angeles
to Chicago. Right, which sounds like something
out of a fairy tale. Yeah, exactly. But, you
know, realize that this isn't a metaphor at all.
It is the literal physical reality of a United
States government program. that just went completely
off the rails. It really is the ultimate example
of a grand vision just violently colliding with
stubborn everyday reality. Totally. Well, welcome
to your deep dive. We have this incredible stack
of sources today detailing the legislative history,
the bizarre production quirks, and frankly, the
massive economic fallout of the United States
Mint's operations in the early 2000s. Yeah, there
is a lot to cover here. There really is. Your
mission today is to explore the fascinating,
slightly absurd, and highly lucrative yet ultimately
failed world of the presidential $1 coin program.
Which is such a wild story, honestly. It is.
We're looking at how a government initiative
that was designed to, you know, educate the public
and generate billions of dollars somehow ended
up creating a stockpile of unwanted money so
massive that it practically became a logistical
crisis. And to really understand how we got to
that billion -dollar stockpile, we have to look
back at the massive success story that the government
was, you know, desperately trying to copy. Okay,
let's unpack this, because the government didn't
just wake up one day in 2005 with this sudden
passion for presidential trivia. No, not at all.
They were chasing a high. Exactly. They were
chasing the high of the 50 state quarters program.
So the presidential one dollar coin act was authorized
in December 2005. Right. And it officially launched
in 2007. Right. And the fundamental blueprint
was to release this series of one dollar coins
featuring relief portraits of U .S. presidents
on the front. You know the obverse and the Statue
of Liberty on the back. The reverse. And they
plan to release them in chronological order.
Right. Like starting with George Washington and
dropping four new designs a year. Exactly. For
a year. Which is exactly the cadence of the state
quarters. I mean, everyone remembers having those
little cardboard maps to push the quarters into.
Oh yeah, people went absolutely crazy for them.
They really did. The Mint knew the public loved
a collectible series, but more importantly, the
Treasury loved the math behind it. Right, the
money. Yeah. That quarter program generated about
$6 .3 billion in seniorage between 1999 and 2008.
Wait, seniorage, can you break that down real
quick? Sure. So seniorage is basically the financial
mechanism where the government profits from the
difference between the face value of a coin and
what it actually costs the Mint to physically...
produce it. Oh, wow. So because people were hoarding
these state quarters in their personal collections
instead of actually spending them, they were
effectively giving the government billions of
dollars in interest -free loans. So the government
looked at that $6 .3 billion and basically acted
like a Hollywood movie studio green lighting
a sequel. Pretty much, yeah. They saw the state
quarters make all that money and just thought,
you know, let's just swap out the states for
presidents. It's a guaranteed blockbuster. That
was the literal logic. They assumed the magic
was entirely in the rotating design. Yeah. Just
completely ignoring the fact that people actually
use quarters every single day, whereas nobody
uses dollar coin. Right. And the legislation
explicitly laid out that hope. I mean, the act
stated that the appeal of changing the design
would increase public demand for a new coin while
simultaneously serving as this pocket sized history
lesson for you, the public. But, you know, getting
a bill through Congress is never just a straight
line from a good idea to a finished product.
No, it never is. We have to look at the legislative
blueprint for this coin. Because this is where
the political compromises actually start to dictate
the physical shape of the metal. Yeah, and the
biggest compromise in that 2005 act actually
stems from the failure of the previous dollar
coin. The Sacagawea dollar. Exactly. The Sacagawea
dollar, which launched back in 2000, it just
never caught on in widespread circulation. Yeah,
I rarely ever see those. Most people don't. But
the Sacagawea dollar had a very powerful, very
vocal constituency, which was the North Dakota
congressional delegation. They viewed Sacagawea
as a local hero and a point of immense state
pride. So just to be clear To get the votes necessary
to pass the new presidential coin act, they had
to appease North Dakota. Yes, exactly. The law
literally mandated that the Mint had to continue
producing Sacagawea dollars alongside the new
presidential dollar. It did. Originally, the
recipe stated that at least one in three issued
dollar coins absolutely must be a Sacagawea dollar.
Wait, really? One in three? Yeah. They later
reduced that to one in five, but the strict production
quota remained in place. OK, wait, let me push
back on. logic here. So the solution to a coin
nobody wanted was to create a new coin, but legally
force the mint to keep making the old coin nobody
wanted, just in case. Yeah, that's about the
size of it. How does that solve the underlying
issue of Americans just preferring paper bills?
If we connect this to the bigger picture of how
legislation is crafted, it doesn't solve the
issue at all. It is pure political log rolling.
And the Federal Reserve actually saw this train
wreck coming from a mile away. Oh, they did?
Oh, yeah. They explicitly warned Congress, stating
on the record that if the new presidential program
didn't stimulate substantial organic demand,
forcing the mint to keep cranking out Sacagawea
dollars would just result in massive storage
costs and waste for the taxpayer. We're just
trying to impartially report what the sources
say here, but it's wild to see how the politics
of the moment just totally won out over the economic
warning. They needed the votes, so the quota
went into the bill. Wow. Exactly. When political
mandates went far beyond just production quotas,
they dictated the exact microscopic composition
of the coin itself. Right, because of the vending
machines. Yes. To ensure the new presidential
coins would actually work in existing vending
machines and transit systems, they had to be
electromagnetically identical to the old silver
-colored Susan B. Anthony dollar from the late
1970s. Because, yeah, a vending machine doesn't
look at the picture on the coin. It runs a magnetic
current through the metal to check its density
and composition. Right, it's checking the signature.
So if the new coin didn't match the old coin's
signature perfectly, every single subway turnstile
in America would just spit it back out. Exactly.
So to achieve that identical electromagnetic
signature while still giving it a totally new
look, they gave the presidential coin a pure
copper core. Okay. And then they clad it in this
very specific manganese brass alloy. We are talking
exactly 77 % copper, 12 % zinc, 7 % manganese,
and 4 % nickel. That is incredibly specific.
It had to be. That specific chemistry is what
gives the coin its distinctive golden color while
simultaneously tricking the machines into thinking
it's just a Susan B. Anthony dollar. There is
also this fascinating omission on the design
itself. Like if you look closely at one of these
coins, the word liberty is just entirely absent.
Which is incredibly rare for American currency.
But lawmakers decided that since the reverse
of the coin featured this giant engraving of
the Statue of Liberty, which is, you know, formerly
known as Liberty and Lightning World, the visual
image itself was sufficient to convey the concept.
They just felt they didn't need to actually spell
the word out. Right. So the mint has this incredibly
specific metal recipe. They have the political
compromises all along. They have the designs.
But moving from the theoretical blueprint to
the actual physical reality of stamping millions
of these out of metal is where this ambitious
project just immediately ran into total chaos.
Oh, absolute chaos. The physical production is
where things really fell apart, specifically
because of one highly ambitious design choice.
The edge lettering. The edge lettering. I love
this detail because it is such a cool historical
callback. It really is. The act mandated that
the year, the mint mark, 13 stars, and the mottoes,
e pluribus unum, and in God we trust, be inscribed
along the edge of the coin, not the face. Which
is a huge shift. A massive shift. It was actually
the first time since the St. Godden's double
eagle gold coin back in the 1930s that the U
.S. issued a circulating coin with edge lettering.
And historically, like going back to the 1790s,
they didn't do edge lettering just to look pretty.
It was actually a functional security feature.
Right, because of the metal value. Yeah. Back
when coins were made of actual precious metals
like gold and silver, people would literally
shave off tiny amounts of metal from the edges
before spending them. Just hoarding the shaving.
Exactly. If you shaved enough coins, you'd eventually
have enough gold dust to melt down and sell.
So by putting elaborate lettering on the edge,
anyone accepting the coin could instantly tell
if it had been shaved or tampered with. That's
right. But for the presidential dollars in 2007,
the edge lettering was purely an aesthetic choice.
They moved the text to the edge just to clean
up the face of the coin, allowing the presidential
portraits to be larger and more detailed. But
that aesthetic choice completely broke the manufacturing
process. It really did. Because applying lettering
to the edge of a coin requires a totally separate
step in the minting sequence. The coin has to
be stamped with the faces and then physically
moved into another machine to roll the text onto
the side. And that transition was the major point
of failure. In February 2007, right at the launch
of the program, an estimated 50 thousand George
Washington coins escaped the Philadelphia Mint,
having completely skipped that second machine.
50 ,000 of them. Yeah. They went out into the
world completely missing their edge lettering.
Which means they were missing the year, the mint
mark, and most notably, the mottos. And because
one of those missing mottos was, in God we trust,
the media and collectors immediately dubbed them
The godless dollars. The collector's market completely
lost its mind over this error. Oh, I bet. The
first discovered godless dollar sold on eBay
for six hundred dollars. Six hundred for a one
dollar coin. Yeah. Now, eventually, as people
realized there were tens of thousands of them
out there, the price settled down to around 40
to 60 dollars. Still a pretty good return on
investment. Right. But the Philadelphia Mint
wasn't the only one having issues. When they
moved on to the second president. John Adams,
the minting machines had the exact opposite problem.
Oh no. What happened? Instead of missing the
edge lettering machine entirely, some of the
John Adams coins passed through it twice. You're
kidding. Nope. So you had coins with double edge
lettering. Sometimes the text was overlapped
in a jumble and sometimes it was inverted, meaning
the second pass of text was printed upside down
relative to the first pass. My absolute favorite.
Error if you can even call it that is from a
couple in Colorado. Oh the blank one Yes, they
found a coin that had the edge lettering perfectly
applied But the coin itself was completely blank.
It somehow skipped the main stamping presses
entirely, but magically made it into the edge
lettering machine. It's hilarious. But honestly,
the most absurd part of the collector frenzy
wasn't the real mechanical errors. It was the
fake one. Yes, the upside down lettering scam.
Here's where it gets really interesting, because
it shows how a little bit of missing information
can just create a massive grift. because of how
that secondary edge lettering machine worked,
it created this hilarious fake error market.
The coins would be stamped with the president's
face and then they would just drop into a hopper
to go into the edge lettering machine. Right.
They dropped in completely randomly face up or
face down. That means on exactly 50 percent of
all the presidential dollars ever minted, if
you hold the president's face upright, the edge
lettering will be right side up. Naturally. And
on the other 50 percent, it will naturally be
upside down. It is just simple probability, a
completely normal intended variation of the minting
process. But scammers went on Amazon and eBay
and started listing the upside down ones as rare
upside down error coins. Which is so funny. They're
actually selling them to unsuspecting buyers
for a massive premium over their $1 face value.
It's exactly like flipping a quarter, having
a land on tails, and then trying to sell it as
a rare tail side up quarter. It is brilliant
in its audacity, but it really highlights the
informational chaos surrounding the whole launch.
But honestly, doesn't this show that the only
people actually paying attention to this billion
-dollar educational program were numismatic speculators
and internet scammers? Yeah, pretty much. The
general public wasn't using them to buy coffee.
They just didn't care. That is the harsh truth.
The public treated them as a novelty, not as
actual money. And that lack of public interest
leads us directly to the physical consequences
of the program. Because they couldn't just stop
making them, right? Exactly. Because while the
public was ignoring them, the United States Mint
was still legally obligated to produce them by
the millions quarter after quarter. So the public
is completely ignoring them, but the legislative
machine can't just be unplugged. The Mint is
legally bound to keep stamping these golden coins
out, which triggers an inevitable physical crisis.
Right. Where do they all go? They bypass the
cash registers entirely and went straight from
the mint into the heavily guarded vaults of the
Federal Reserve. Wow. By 2011, just four years
into the program, the Federal Reserve had amassed
a staggering stockpile of one point four billion
uncirculated one dollar coins. One point four
billion coins. I mean, that isn't just a number
on a spreadsheet. That is a physical nightmare.
It's unbelievable. We are talking about reinforced
concrete floors just groaning under the weight
of thousands of tons of brass. To give you a
sense of scale, the reports noted that if you
laid those 1 .4 billion coins flat, edge to edge,
they would stretch all the way from Los Angeles
to Chicago. That is insane. And the internal
projections were grim. If they didn't halt production,
that stockpile was projected to hit two billion
coins by 2016. That is literal physical money
being wasted by the sheer act of manufacturing
and storing it. Yeah. But there is a massive
financial irony buried in this failure, isn't
there? Because mathematically, the coin wasn't
actually a bad idea. No, the math heavily favored
the coin. A report by the Government Accountability
Office, the GAO, looked at the numbers and concluded
that discontinuing the paper $1 bill in favor
of the $1 coin would actually save the U .S.
government about $5 .5 billion over a 30 -year
period. And that mechanism comes entirely down
to durability, right? Exactly. A paper dollar
bill gets passed around constantly. It's crumpled
in pockets, torn in vending machines. It only
lasts an average of maybe 18 months to two years
in circulation before the Federal Reserve has
to pull it, shred it, and print a replacement.
It's a very short lifespan. Whereas a metal coin,
on the other hand, can stay in circulation for
decades. So even though the coin costs more to
manufacture initially, the long -term savings
of not constantly replacing paper are just enormous.
The savings are huge. So what does this all mean
for you the listener we hear about government
waste all the time But this seems like a completely
solvable problem, right? They did it in Europe
with euro coins. They did it in Canada with the
loony They just stopped making the paper bills
and forced the public to use the coins Why do
you think American lawmakers refused to just
eliminate the paper dollar bill to force the
issue? It really is a fascinating case study
in the friction between cultural habits and economic
efficiency. Americans simply love the paper dollar
bill. It is lightweight, it folds neatly into
a wallet, and it is deeply ingrained in the culture.
People are used to it. And politicians are highly
sensitive to that kind of cultural inertia. No
politician wanted to run for reelection as the
person who took away the dollar bill and forced
Americans to walk around with heavy pockets full
of jangling change. So because they lacked the
political will to retire the paper bill, the
newly minted coins were just forced into a system
that didn't need them and didn't want them. Exactly.
Turning a potential five point five billion dollar
savings to a massive sum cost. And eventually.
The optics of this giant vault of unwanted money
just got too bad for the administration to ignore.
I could imagine. In December 2011, Vice President
Joe Biden and Treasury Secretary Timothy Geithner
officially suspended the circulation program.
OK, so they finally pulled the plug. They did.
They announced that going forward, starting with
the 21st president, Chester A. Arthur, the coins
would only be minted in very small custom batches
specifically for collectors who wanted to complete
their sets. They essentially turned off the faucet.
But did that actually fix the stockpile? Slowly.
Very, very slow. How slowly? Well, by the end
of 2022, the stockpile of dollar coins had dwindled
from 1 .4 billion down to about 888 million.
That's still almost a billion coins. Right. The
Federal Reserve estimates that the remaining
inventory will last them for nearly 16 more years,
carrying them all the way to 2038. So we are
still going to be dealing with the physical hangover
of this program for another decade. At least.
But the story doesn't actually end when they
suspended circulation in 2011. Because this original
2005 law had all these strange legislative afterlives
and companion pieces attached to it. It did.
The law was remarkably rigid about who could
be on a coin and when. It created some incredibly
tricky historical puzzles for the mint to solve.
Let's talk about the two years' deceased rule,
which is just a fantastic piece of legislative
tripwiring. Yeah, the act specifically stated
that for a former president to be honored on
a coin, they must have been deceased for at least
two years prior to the time of minting. Right.
The law explicitly forbade putting a living or
recently deceased president on a coin. Which
created a really weird staggered endpoint for
the series. It did. When the program formally
reached its planned end in 2016, honoring Ronald
Reagan as the final eligible president, the Mint
had to skip several presidencies. Because they
were still alive. Exactly. Jimmy Carter, Bill
Clinton, George W. Bush, and the sitting president
at the time, Barack Obama, were all skipped because
they were still living. So if you want to add
a skipped president later, you can't just have
the Mint spin the machines back up. No, you can't.
It requires a completely new, literal act of
Congress to amend the program. Yes. And we've
seen this happen, right? Following the passing
of George H .W. Bush, Congress had to pass a
specific bill signed into law in early 2020 just
to authorize a presidential dollar honoring him.
Right, they had to legally add him back in. And
more recently, in early 2025, following the death
of Jimmy Carter, a new bill was introduced in
the Senate to extend the program for him as well.
And that rigid structure also applied to the
first spouse program, which was created by the
exact same 2005 law and is honestly a whole other
level of complicated. The first spouse program
was wild. It mandated the issuance of half ounce,
ten dollar gold coins featuring the images of
the spouses of the presidents. Yeah. And they
had to be released on the exact same schedule
as the presidential dollars. Solid gold coins.
They were intended purely for the collector's
market, not for circulation, and their prices
fluctuated wildly with the global gold market.
Right, because the price of gold changes daily.
Exactly. The mint was often selling them for
well over $400 or even $700 each. But applying
stripped rules to 200 years of marital history
created some really weird problems. Because what
happens if a president wasn't married? Right.
Four presidents served their terms while unmarried.
The law dictated that for those specific presidencies,
the gold coin couldn't just be blank. It had
to feature an obverse image emblematic of liberty
as depicted on a circulating coin from that specific
historical era rather than a portrait of a person.
But there is one exception to that generic liberty
rule that I absolutely love. Oh, the Alice Paul
exception. Yes, the Alice Paul exception. So
Chester A. Arthur was a widower. His wife Ellen
died before he took office. But instead of just
defaulting to another generic liberty design
for his slot in the schedule, the law explicitly
stated that his companion coin would feature
Alice Paul. Alice Paul, who was a famous leader
in the women's suffrage movement. He was incredibly
instrumental in the passage of the 19th Amendment,
which gave women the right to vote. And the connection
is that she was born in 1885, right during Arthur's
presidency. So, because he happened to be a widower,
lawmakers used that blank slate to insert an
incredible tribute to a major civil rights leader
right into the middle of the First Spouse program.
It really is a genuinely cool historical workaround.
Yeah, it's amazing. And this really raises an
important question about how legislation actually
functions in practice. Because this 2005 act
didn't just stop at the Presidents, the First
Spouses, and the Sacagawea quotas. No, it is
the ultimate example of a legislative Christmas
tree. That's what they call it. When a bill starts
out as one core idea, the trunk of the tree,
and then every politician starts hanging their
own pet projects onto it like ornaments. Which
is exactly what happened here. You have the main
branch, which is the presidential dollar, but
then someone says, we need a Sacagawea quota
to appease North Dakota. We need solid gold coins
for the first spouses. And they didn't stop there.
No. This exact same bill mandated a total redesign
of the Lincoln penny for its 2009 bicentennial,
requiring four different designs showing the
stages of his life. Right. and it authorized
the creation of the $50 American Buffalo gold
bullion coin. The bill just became a catch -all
vehicle for a dozen different numismatic projects.
They tied all these separate ambitions together
into one massive unwieldy law. They really did.
So looking at this whole journey, we're looking
at a program. that started with the best of intentions.
The presidential $1 coin program was supposed
to be a shortcut to a more efficient economy,
saving taxpayers $5 .5 billion, while giving
everyone a little history lesson right in their
pocket. But instead, it became a master class
in the absolute limits of government design.
It proves that you cannot simply legislate consumer
behavior. You can mandate the alloy, you can
mandate the edge lettering, and you can build
a massive legislative Christmas tree. But if
the public doesn't want to carry a heavy coin,
no amount of historical engravings or political
maneuvering is going to force them to use it.
It just stands as a billion -dollar physical
monument to the undeniable power of the paper
dollar bill. Which leaves us with a lingering
question, one that extends far beyond the vaults
of the Federal Reserve. What's that? Think about
the cash in your wallet right now if you even
have any. We reject coins today because they
are heavy and inconvenient. But as we rapidly
move toward a completely cashless society, reliant
on tapping phones and digital transfers, what
happens to the physical monuments of our history?
That's a great point. If a billion shiny new
coins couldn't make us care about former presidents
in 2007, will we ever have another physical touchstone
for our shared history? Or is the era of the
commemorative coin as a tool for public education
gone forever? That is definitely something to
chew on the next time you tap your phone to pay
for a coffee. Until then, thank you for joining
us on this deep dive. And seriously, go check
the change jar in your kitchen if you find a
presidential dollar. Check the edge. Even if
the upside down lettering won't make you rich,
it is still a pretty great piece of history.
Catch you next time.