I received an interesting e-mail message earlier today sent by Scott McCartney, who is the author of The Middle Seat Terminal column for The Wall Street Journal, in which he says, “Believe it or not, the $1 coin story I did in 2009, showing how FlyerTalk members were getting free miles through a U.S. Mint promotion, apparently was the inspiration for the trillion-dollar coin debt ceiling solution idea that is sweeping Washington…”
I believe it — especially since I have met all of the FlyerTalk members mentioned in the story written in 2009, as well as Scott McCartney himself. When I read the story for the first time, I kept nodding my head — unlike someone reading about this for the first time. Although I did not personally take advantage of the one-dollar coin scheme, I felt connected to it.
“This” is the laundering of one dollar coins purchased from the United States Mint with credit cards that awarded frequent travel loyalty program miles and points by FlyerTalk members — at face value, and with free shipping. Once the coins were purchased, they were usually never used. Rather, they were deposited into the bank by FlyerTalk members, who purchased as many as 800,000 coins towards award trips, upgraded travel, free lodging — and even free lifetime elite status.
This went on for greater than three years — until the media was alerted about it. The United States Mint then eliminated the credit and debit card purchase of one dollar coins through its Direct Ship Program effective as of July 22, 2011. Customers who wished to purchase one dollar coins through the Direct Ship Program were still able to do so by wire transfer, check or money order.
How was the media alerted about such an incredible deal which allowed FlyerTalk members to earn frequent travel loyalty program miles and points without having to spend one penny or step outside of their homes? FlyerTalk members blame it on “bloggers” who seem to step all over each other to “scoop” a story and increase readership, which in turn supposedly increases advertising revenue and allegedly allows the “bloggers” to profit from credit card referrals. In the process, the “bloggers” apparently reveal secrets which — once they become public — are shut down shortly thereafter.
FlyerTalk members attempt to keep secrets such as “mistake airfares” and “mileage runs” and short-cuts to elite status as quietly as possible in order to keep the deals “alive” as long as possible. Let’s be realistic about this and face it — with a membership of 456,000 members and still growing, keeping secrets limited to FlyerTalk has become increasingly difficult. Even still, a very small percentage of the FlyerTalk membership actually takes advantage of the secrets to an extreme — but it is apparently enough for companies affected by the schemes to close known loopholes to protect themselves from the secrets becoming “viral” and spreading to the masses, which could possibly affect profit margins significantly.
Media coverage certainly exacerbates the issue of sharing travel secrets on loopholes with unintended purposes. The United States Mint attempted to circulate its one dollar coins to promote their use instead of than dollar bills, as coins are more durable and last longer — and therefore would save the United States Mint money over the long run. While not illegal, the laundering of one dollar coins to gain frequent travel loyalty program miles and points free of charge — only to deposit those coins back into a bank and out of circulation — was a consequence which was certainly not the intended purpose of the one dollar coin. I do not go to a bank and ask for one dollar coins — do you?
As a result of travel schemes and secrets being shut down due to media attention, I have known of FlyerTalk members taking matters into their own hands and sharing secrets off of FlyerTalk through little-known Internet web sites with passwords, as well as via e-mail messages. FlyerTalk members who are not a part of these private or semi-public networks cry “foul” and “unfair”, claiming that these secrets should be shared amongst all FlyerTalk members who want to take advantage of unintended deals such as the one dollar coin scheme.
No — I will not reveal these Internet web sites. Sorry.
However, one effect of revealing this specific secret is that FlyerTalk actually could significantly influence politics in Washington, D.C. in this particular case. Imagine a coin worth one trillion dollars — issued by the United States Mint, which reportedly has the power to manufacture such a coin — to circumvent a debt-ceiling crisis where the United States Treasury “could avoid borrowing and bypass the debt ceiling.” This idea — crazy enough that it actually just might work — was the idea of an attorney based in the state of Georgia who was inspired by the 2009 story written by Scott McCartney.
“I have long found the creativity and passion of frequent-flier mileage enthusiasts to be inspirational”, writes McCartney. “It’s good to know that serious students of fiscal policy do, too.”
While I am not naïve enough to believe that the United States Mint will actually produce a coin worth one trillion dollars, I am hoping that creative thinking “outside of the box” will lead to a viable, more plausible solution which will actually work to help mitigate the debt-ceiling issue. If the influence of FlyerTalk contributes towards the inspiration of such creative ideas, all the better. Perhaps that will throw a new spin on the debate about whether or not secrets and schemes should be shared — and I do not intend to debate that topic here in this article.
As for the United States Mint, you can still order one dollar coins in boxes of 500 — but you will pay a premium of $50.95 for the privilege. That means that if you earn a frequent travel loyalty program mile or point for each dollar you spend, you will pay slightly greater than ten cents per mile or point — which is out of range for most “mileage runners” who usually set their threshold at three cents per mile or less for an extraordinary deal of which they must take advantage — and the miles and points earned through purchasing one dollar coins may not count towards elite status, depending on the credit card you use.
If you are confused about the part pertaining to not earning elite status when I wrote earlier that lifetime elite status was attained through the purchase of one dollar coins, that was because the lifetime elite status was earned on American Airlines when all AAdvantage frequent flier loyalty program miles counted towards elite status before December 1, 2011.
Could FlyerTalk have a greater influence over politicians and governmental policies — in the United States and elsewhere in the world — in the future? Who knows?!?
Scott McCartney thought that we “might find this fun.”
We do, Scott. Thank you.