- By Joshua Keating
Joshua Keating is associate editor at Foreign Policy and the editor of the Passport blog. He has worked as a researcher, editorial assistant, and deputy Web editor since joining the FP staff in 2007. In addition to being featured in Foreign Policy, his writing has been published by the Washington Post, Newsweek International, Radio Prague, the Center for Defense Information, and Romania's Adevarul newspaper. He has appeared as a commentator on CNN International, C-Span, ABC News, Al Jazeera, NPR, BBC radio, and others. A native of Brooklyn, New York, he studied comparative politics at Oberlin College.
One of the more amusing sideshows of the debt-ceiling negotiations is the so-called "platinum coin option." Under this scenario, the president could sidestep Congress by exploiting a legal loophole that allows the Treasury to print platinum coins in any denomination it wishes. This is meant to allow the Treasury to mint commemorative coins, but there’s theoretically nothing stopping the president from just mining a $1 trillion coin to finance the government. Josh Barro makes the case for the $1 trillion coin here. Kevin Drum argues against it here. To be sure, the proposal is more of a "modest proposal," but it’s being taken seriously enough that one congressman has introduced legislation to close the platinum-coin loophole.
This got me curious: What’s the closest the world’s ever gotten to a $1 trillion coin?
First of all, it’s important to distinguish between the value of the metal and the value of the coin. As Barro makes clear, we’re not actually talking about $1 trillion worth of platinum, which would be absurd. (I know that’s a strong word to be throwing around in a discussion of $1 trillion coins, but work with me here.)
The most valuable coin in the world, face value aside, is probably the "flowing hair" $1 coin minted in 1794 and 1795 — the very first dollar coin issued by the U.S. government. One of these sold for $7.85 million in 2005.
According to the Guinness Book of World Records, the largest denomination monetary unit ever printed was the Z$100 billion banknote printed in Zimbabwe in 2008. In the midst of the country’s hyperinflation, it was enough to buy about one loaf of bread.
The highest denomination banknote in U.S. history was the $100,000 bill, ironically printed at the height of the Depression in 1934. It featured Woodrow Wilson’s face.
But the closest direct competition for the $1 trillion coin seems to be the 68-pound gold monster unveiled by Canada in 2007 with a face value of C$1 million. (About US$1.01 million.) The pizza-sized behemoth is 99.99 percent gold, meaning it’s probably worth about twice its face value. Only five were made.
I don’t know if it’s a solution to the budget crisis, but if nothing else, it’s time for the U.S. Treasury to take this super-loonie down a notch.