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Mr. WIGGEN. That is right.
Mr. WIGGEN. That is right from a cost viewpoint; however, seigniorage on the additional coinage will amount to $40 million.
Mr. STEED. What is the reason for the estimated cost of silver coins going up substantially as production is increased ?
Mr. WIGGEN. They are going up to some extent but not substantially. One of the reasons for that is that we have, like everyone else, wage increases. When we attempt to operate on a three-shift basis you
do not get the same efficiency as you have on a one- or two-shift operation.
In other words, when you have downtime in one operation it might affect another operation.
MACHINERY FROM DEPARTMENT OF DEFENSE
Mr. STEED. You speak of getting some machinery from the Department of Defense. How did they happen to be in possession of such equipment ?
Mr. WIGGEN. The equipment we are getting from them is equipment which was used in making cartridge shells, stamping equipment similar to that used in the mint although not exactly the same type of equipment. It is not as fast as our presses but by converting them and putting feeders on them they can be used for stamping coins.
Mr. STEED. Is this a very expensive matter to convert those machines from the original purpose to coinmaking ?
Mr. WIGGEN. We are converting 16 presses for about $140,000. That is slightly under $10,000 apiece.
Mr. STEED. What would be the cost if you were buying new coin machines?
Mr. WIGGEN. The new presses would cost a minimum of $20,000 and we would not be able to get delivery in the same period of time. In other words, this is something we are doing to get presses to go
into production at a much earlier date. We will get delivery on these presses in October and November of this year.
Mr. CARWILE. This also involves 16 blanking and stamping presses.
Mr. STEED. I understand you are going to discontinue making proof coin sets for collectors.
Mr. WIGGEN. We have to continue making those until we manufacture the proof coins for which we have taken orders. After that has been done we plan to discontinue it. In that way we will be finished making those coins in December of this year.
FOREIGN COIN WORK
Mr. STEED. Are you doing any foreign coin work now? Mr. WIGGEN. No. Mr. STEED. There was a time when you did quite a bit of work for other governments!
Mr. WIGGEN. Yes; when we had the capacity to do it and meet our own demand at the same time.
Mr. STEED. That is all.
Mr. Gary. You were asked about collectors. The number of dealers in coins has tremendously increased in the last year or two; has it not?
Mr. CARWILE. According to the trade papers it appears so.
Mr. Gary. I have seen some figures which seemed to indicate they have doubled or trebled.
Mr. CARWILE. I have heard this but I have no personal knowledge of it.
Mr. BELIN. Certainly their advertising has become ever so much more aggressive, too.
Mr. GARY. Mr. Conte?
MANUFACTURE OF BRONZE STRIP
Mr. CONTE. When do you anticipate you will be able to manufacture again your own bronze strip?
Mr. WIGGEN. We may not be in a position to manufacture our own strip until the new mint goes into production in Philadelphia. This depends on the coin demand.
PRODUCTION OF PHILADELPHIA MINT
Mr. CONTE. What will be the full production capability of that mint at Philadelphia ? Give it to me in two shifts and three shifts.
Mr. CarWILE. I think we had better get that for you for the record. It seems to me that eventually we can make about 6 billion pieces. This would require much additional equipment.
Mr. HOLLYFIELD. On two shifts.
Mr. WIGGEN. So far we have only placed one order for bronze strip and that order was with the Chase Brass & Copper Co.
Mr. CONTE. And you are buying all your nickel strip?
SILVER CONTENT OF NEW SILVER DOLLARS
Mr. CONTE. Will the new silver dollars have the same amount of silver in them as the old ones?
Mr. WIGGEN. Yes.
DISPOSAL OF OLD SILVER DOLLARS
Mr. CoNTE. And further questioning you in regard to the chairman's question, why would it not be a good idea---maybe it would cost a little more money—but why would it not be a good idea to melt the present silver dollars you have in the mint ?
Mr. WIGGEN. We are not holding silver dollars in the mint. The remaining silver dollars are held in the Treasury.
Mr. Belin. Could I answer that? They are in the Office of the Treasurer of the United States. There are just under 3 million old silver dollars and, as you know, a number of these we believe have high numismatic value and the Secretary told the congressional committees he would wait and consult with Congress before he made a proposal as to how to dispose of them. We have had a large number of suggestions ranging from auctions to numerical receipt of requests, but we have not reached a plan for disposal yet.
Mr. CONTE. I hope you give it a lot of serious thought because if they are thrown on the market some people will get rich and a lot of people will get mad.
Mr. Belin. We are aware of the problem.
Mr. STEED. If the gentleman will yield there, it would seem to me the smart thing to do would be to put the Treasury Department in this coin business and make all we can out of them.
Mr. Belin. We have given some consideration to that. Traditionally, the Treasury has not wanted to get in the numismatic business. But your suggestion has received a lot of thought.
Mr. STEED. I do not believe there is any way you can dispose of those 3 million coins without bringing criticism on your head unless you sell them to the highest and best bidder.
Mr. Gary. You will be subject to criticism anything you do.
I read in the newspapers a couple of days ago about a charge made by Charles Slade III in regard to silver dollars and he accused certain people working in the Treasury of switching silver dollars and using the old Morgan silver dollars and the ones from New Orleans dated 1880 and 1890 and selling them. He further goes on to state that several employees have been fired down there. He contends 800 bags have been switched.
Do you have anything to say on that? Mr. Wiggen. I have read about it. There have been no employees of the mint fired for reasons of that kind.
Mr. Conte. They would not be in the mint. They would be where those silver dollars are located.
Mr. BELIN. I do not know about that except I have read there was a denial by the Treasury.
Mr. CONTE. That is another good reason why they should be melted down.
STAMPING OF COINS AT SAN FRANCISCO MINT You mentioned San Francisco will not stamp coins, and you used the words "at present."
Mr. WIGGEN. That is right.
Mr. WIGGEN. I understand there has been a bill introduced to authorize the stamping of coins at San Francisco.
Mr. Gary. At the present time it is prohibited by law.
Mr. CONTE. So it all depends on whether legislation is passed by the Congress?
Mr. WIGGEN. Yes.
COST OF SAN FRANCISCO MINT
Mr. CONTE. Do you have a comparable cost of doing whatever you are doing in San Francisco with the cost at Denver ?
Mr. WIGGEN. Well, the cost of what we are doing at San Francisco should not be any higher than at Denver because the one thing we are doing is making blanks and annealing them. We are not in operation yet so we do not know what the cost will be, but we do not anticipate there will be any large difference between doing the same work in Denver and San Francisco.
Mr. CONTE. You will need guards, will you not?
Mr. WIGGEN. Yes, we already have a guard force at San Francisco, but we will need a few more.
Mr. CONTE. That will be additional because if you were doing this in Denver or Philadelphia you would use the guards you have.
Mr. CARWILE. As a matter of fact, we have to go to San Francisco because we do not have the space in Denver.
Mr. CONTE. This strip you say is bought from the Chase Co., where are they located ?
Mr. WIGGEN. The strip is being made in Cleveland.
Mr. Wiggen. We would buy from the lowest bidder, probably in the San Francisco area.
Mr. CONTE. And after you stamp the blanks you have to transport them to Denver ?
M". WIGGEN. We transport the blanks to Denver.
Mr. Wiggen. Probably they would be shipped by truck. We ship them in truckload lots of about 30,000 to 40,000 pounds.
Mr. Gary. The containers probably would be shipped from San Francisco to Denver by truck?
Mr. WIGGEN. Yes.
Mr. WIGGEN. We are certainly going to try to hold shipments to Philadelphia to a minimum.
Mr. CONTE. That would be a costly operation.
NEW SILVER DOLLARS
Mr. CONTE. What do you anticipate will be the length of time required to mint the 45 million silver dollars?
Mr. WIGGEN. Well, that, of course, would depend upon how many presses we would put on silver dollars. We would try to mint the silver dollars in such a way that would not interfere too much with the other coin production. So we might just spread the manufacturing out over the fiscal year. In other words, we may just put two presses on silver dollars.
Mr. CONTE. You could put those same two presses on lesser coins? Mr. WIGGEN. Yes.
Mr. CONTE. So you cannot say it will not hinder the production of lesser coins?
Mr. WIGGEN. We would hold it to a minimum. Because of the large amount of metal required for the silver dollars it will take up a greater proportion of our annealing capacity than when we are annealing smaller denomination coins.
USE OF ANNEALING AND ROLLING EQUIPMENT
Mr. CONTE. Is your annealing and rolling equipment kept going on a 24-hour basis now?
Mr. WIGGEN. Yes.
Mr. CONTE. So when you are annealing and rolling silver dollars you will have to take your equipment from annealing and rolling the lesser coins to anneal and roll the silver dollars?
Mr. WIGGEN. To some extent.
Mr. CONTE. I am using your own words. You say you are using your rolling and annealing machines 24 hours a day on lesser coins so you are using them to full capacity ?
Mr. WIGGEN. At the present time we can produce more silver blanks than we can stamp so until we get the new equipment we will save up blanks which we will use for stamping at the time that we are melting and rolling the silver dollars so as to minimize the effect of the silver dollar operation on the other coins.
Mr. STEED. Will you yield?
As I understand it, the thing that determines how many coins you can make is the stamping machine?
Mr. WIGGEN. The annealing and stamping. But we have made arrangements to get some blanks annealed at the Frankford Arsenal.
Mr. Conte. In other words, you have gone to a third source, the Frankford Arsenal, to take care of this operation ?
Mr. WIGGEN. Yes.
Mr. WIGGEN. We will be billed on a reimbursable basis, whatever the cost is.
Mr. CoNTE. You do not have any estimate?
Mr. Gary. It will cost more, however, than if you annealed these yourself?
Mr. CARWILE. As far as we can tell it will cost about 18 cents for 1,000 pieces. It costs us about 4 or 412 cents.
Mr. CONTE. That is all, Mr. Chairman.
Mr. STEED. Mr. Chairman, might I ask one more question of Mr. Belin?
Mr. Gary. Yes, sir.
Mr. STEED. It is my understanding that in the "Public debt" item, this money is asked for on the basis of estimates and in the event these estimates prove erroneous, the money would not be spent. It would revert then?
Mr. BELIN. Maybe Mr. Burris can answer that better than I can.
Mr. BURRIS. This money would be placed in reserve in the regular budgetary process
Mr. STEED. In other words, if we allowed this it would not necessarily be spent ?