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Mint Misregulation

The U.S. Mint is issuing regulations to "prohibit, with certain exceptions, the melting or treatment of all one-cent and 5-cent coins."

Prevailing prices of copper, nickel and zinc have caused the production costs of pennies and nickels to significantly exceed their respective face values. The United States Mint also has received a steady flow of inquiries from the public over the past several months concerning the metal value of these coins and whether it is legal to melt them.

The new regulations authorize a fine of not more than $10,000, or imprisonment of not more than five years, or both, against a person who knowingly violates the regulations. In addition, by law, any coins exported, melted, or treated in violation of the regulation shall be forfeited to the United States Government.

Inflation is the deliberate policy of the U.S. Government and has been ever since the creation of the Federal Reserve. The government forced us off the gold standard in 1933, ended silver coinage in the 1960s, and in 1982 even had to debase the penny from mostly copper to mostly zinc. Now the copper content of pre-1982 pennies, and the nickel content of nickels, are worth more than the face values of the coins. People are naturally interested in selling them as scrap metal instead of using them as currency.

The U.S. Mint is overreaching — these regulations are illegal. The proper scope of regulation is only "to make regular" certain things or activities, to lay down rules about how they are to be done. The power to regulate is not the power to prohibit. Only a legislative body like the U.S. Congress has the authority to issue prohibitions and set criminal consequences.

I intend to submit a comment about this rule once I've read it, but the press release is only a summary and the rule itself has not been published yet. I called the Mint to ask where I could find it and they said it won't be published until tomorrow in the Federal Register, despite their press release today saying "The interim rule appears on the United States Mint website."

They should have held the press release until the rule was published. That was bad of them. But I can wait a day…

UPDATE 2007-01-05 15:43:02 UTC: Actually, Congress did give the Secretary this power, and quite explicitly, in 31USC5111(d)(1). Read this for more information.

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