the money game

What Happened to America’s Quarters?

Illustration: Tamara Shopsin

Our government just dropped a hot new quarter featuring Maya Angelou with her arms dramatically aloft, posed before a bird’s giant wingspan. It’s the first of a series, each depicting women on the back. (George Washington is still on the front.) Arrival of the long-planned quarter was met with joy tempered with bafflement. Hey — aren’t we in a coin shortage?

The answer is complicated. For some time now, the United States of America, among her other struggles, has indeed been in the silvery throes of a slow-moving crisis of coin. It became apparent in the spring of 2020, when our sudden lack of desire to get breathed on forced many of us to stop transacting money IRL. The Federal Reserve found that in April 2020, only a third of Americans had made an in-person purchase within the past 30 days — and only slightly more than half of those people reported using cash. (In previous surveys, nearly everyone had reported recently making an in-person purchase.) We had ceased being cogs in the money-circulation system; we were neglecting our role as the pollinators of cash. It was yet another supply-chain issue, one in which the troublesome link was you and me.

With this disruption of the constant input of coins into banks and Coinstars and cash registers, the currency output hiccuped as well. That’s why, in the summer of 2020, you saw stores posting signs to warn customers that cashiers wouldn’t be able to make change. A Dollar Tree in the suburbs of Detroit was offering to buy coins from customers; Kroger stores were crediting change to customer-loyalty cards; and people in Belton, Texas, were charging into laundromats to use the change machines and then leaving, violating the social contract of laundromat fairness and making the problem of finding quarters even worse. Meanwhile, the Federal Reserve started rationing coins to local banks, placing a temporary cap on how many they could order.

A bit panicked, the U.S. Mint and the Federal Reserve introduced an entity called the U.S. Coin Task Force, bringing together government, big retail players, and commercial banks in order to make at least this one aspect of COVID less painful and less prolonged. This group included friends and competitors with a vested interest in the fate of coins, like Coinstar and the armored-car people. (Brink’s makes a big chunk of its revenue from ATMs and running money; a pillar of its cash-moving business is transporting new currency in and around the Federal Reserve system.) In the summer of 2020, this task force agreed on a diagnosis: that we lazy Americans were simply refusing to exchange these coins frequently enough, creating a “dramatic deceleration of coin circulation through the supply chain.” There was, in other words, no shortage. America still had tens of billions of dollars of coins. It just so happened that, like the murderer in the movies, they were in your house right now.

But the reasons our coins were building up in our piggy banks and under our couch cushions turned out to be greater than simply our lack of in-person shopping. In the U.S., while our bills have mostly remained a transaction currency (you give ’em a $20 at the deli and get a bacon and egg on a roll), our coins, worth just little bits of money, are mostly a settlement currency (the deli gives you back the difference in change). For many of us, we’d only be bothered to return that change to our economy when it’s time to do laundry or when we aren’t going to make it to payday — off to Coinstar we go!

From the Coin Task Force emerged a hashtag, #GetCoinMoving, giving an echo of 1989’s classic Soul II Soul track “Keep on Movin’. ” The task force created social-media images and captions that included “Calling all coin!” and “Spend your coins — they’re bored!” It called on Americans to empty their couches and car ashtrays like it was a war draft.

It didn’t work. And meanwhile, the idea that the U.S. was literally running out of quarters and dimes to keep our barely functioning society going had become a meme — obvious, self-reinforcing. (Twitter reactions to the Angelou quarter included “During a coin shortage? Comical” and “Isn’t there a coin shortage?? How the hell am I supposed to get one 😒.”) Even after people began returning to stores and transacting more normally, we saw coin scarcity everywhere. Some of New York’s retail darlings, in defiance of a 2020 city law mandating that businesses accept cash, stubbornly refused to open their registers. Last year, ice-cream parlor Van Leeuwen was fined for repeatedly violating the cash mandate; by November 2021, it still wasn’t accepting legal tender and hadn’t paid its fines, according to an Eater investigation. And while Roberta’s, holder of the hipster pizza crown, famously used to be an all-cash business, its South Williamsburg location was fined $1,000 for not accepting cash at all.

“Pseudo shortages are as serious as actual shortages, just as psychosomatic illness produces symptoms as real and painful as those created by actual illness.” That’s what Representative Dante Fascell said at a House subcommittee hearing on American coin shortages in 1964. The coin shortage of the 1960s, the subcommittee agreed, had pretty much one cause: People were hoarding silver coins because the value of silver was growing and the specie was worth more as an investment than as actual currency. Congress moved fairly swiftly, in government terms. By the next year, dimes and quarters were no longer made of silver. Case closed!

Now our coins are made of garbage (apologies to the zinc industry!), and as currency, they’re worth less and less to us every year. Despite our indifference, the U.S. Mint is ordered to keep up annual production — even if that means it’s drowning us in shiny new coins that merely add to our collection of coins we don’t use. But no matter how worthless they become, there’s always someone who can make money off coins: counting them, wrapping them, transporting them. And because of the constant flood of free new coins, there is no actual (as in financial) pressure on anyone involved to unlodge those old ones from our homes.

This coin quandary was minted long before the pandemic. In December 2018, the U.S. Mint privately gathered people in D.C. to brainstorm ways to reduce the country’s dependence on constantly pumping out new coins. Ideas usually include eliminating pennies or nickels or changing their composition. That’s not good business for the quiet interests involved. The zinc industry, for example, is heavily invested in the life span of the penny (and pays Americans for Common Cents for its lobbying powers). And if you change the composition of a coin, you’d pass on a large onetime cost to institutions that measure coins by weight or thickness or metal.

With the big issues of our time — global warming, a never-ending pandemic — we love to obsess about individual decisions: what we buy and how we throw it away, where we go or don’t go. When it comes to our slow coin-extinction event, we get the blame as well. But it’ll only be resolved when someone figures out a way to make money fixing it.

In the meantime, scarcity takes all forms, including the lengths to which people still go to gin up some quarters. Last year, Aja Lans, a bioarchaeologist, moved to the Boston area from New York City. Her basement laundry room in New York had a card system, but her Boston place was Quarter City. In the first month, she busted open a pineapple piggy bank. That ran dry quick. Lans thought she’d try her husband’s work, a large plumbing-supply company. Nope — it no longer had coins. Lans figured she’d go to the bank; a neighbor told her not to bother. “She was like, ‘I tried that. They don’t have any either,’ ” Lans said.

In December, she went home for Christmas to upstate New York. In a classic clear family coin jar, her mother had been stockpiling a small fortune in change. Mom passed her a Ziploc bag full of coins in exchange for Venmo. This ends one household’s crisis — for now — and their Christmas was mostly successful, though the family lost a few attendees to positive coronavirus tests along the way, a fittingly disruptive end to 2021. “So it was very small, and we had a little kind of dinner,” Lans said. “But at least I got quarters out of it.”

What Happened to America’s Quarters?