Should the US abolish the penny?

[myp]

Canada recently passed a bill that will lead to no more pennies being minted. It is a very economically sensible move given the costs to make the pennies vs. their value. It is something the United States should really be considering and pushing too in my opinion as it is a pretty easy but effective idea. Maybe even rid of the nickel while we're at it. It would also leave room for greater dollar coin usage, which could also help minting costs since dollars are so widely used.

Any thoughts on this?

 

[mogur]

Yes. I have a thought. E pluribus unum. It means, from one, many. It was our motto until 1965. The religious right wants us to believe that it was the founders motto. What a load of crap. It was evangelistic imams that wanted us to change our motto to fit their narrow belief system. During the civil war, the union wanted god to be on the their side, but you mason dixons should be pissed. God may or may not have been on your side, but you surely don't want our money to claim that god is on the union side. Or do you? Down with 'In God We Trust' and up with from one, many, which is the core of this country's uniqueness.

 

[DodgeFB]

Canada recently passed a bill that will lead to no more pennies being minted. It is a very economically sensible move given the costs to make the pennies vs. their value. It is something the United States should really be considering and pushing too in my opinion as it is a pretty easy but effective idea. Maybe even rid of the nickel while we're at it. It would also leave room for greater dollar coin usage, which could also help minting costs since dollars are so widely used.

Any thoughts on this?

I hate dealing with pennies. And they are heavy in my pockets.

 

[rice_farmer]

I hate dealing with pennies. And they are heavy in my pockets.

All pocket change should be smelted down and built into a large statue/shrine to Obama.

 

[DodgeFB]

All pocket change should be smelted down and built into a large statue/shrine to Obama.

I hate dealing with him too.

 

[MPR]

I haven’t really considered this topic, but here are a few initial thoughts:

-I don’t really like the Canadian method (which I believe other countries have used too) of having the 1¢ denomination for all transactions except for cash. If they are going to get rid of the penny, then get rid of it everywhere. Just as when we conduct business in fraction of cents and the final product is rounded to the nearest penny, if you abolish the penny the final products should be rounded to the nearest 5¢ no matter what kind of transaction is conducted.

-The logic to abolish the penny is even more prevalent for the nickel. Therefore, if the penny goes, so too should the nickel. This would mean a shift from dealing in $.01 to dealing in $.1, i.e. units of 10 instead of units of 100. The only coins in this system would be the dime and the fifty-cent piece; the quarter would need to be removed due to using the hundredths place.

-The savings from going to dollar coins as opposed to dollar bills is calculated as a 30 year savings. For the first 10 years the government would actually lose money. And, even the authors of this study admit that the savings are theoretical and may not actually come to fruition.

-Every attempt to introduce the dollar coin has been so thoroughly rejected by the US markets that the government has billions of these coins stored in a Scrooge McDuck style vault. The added cost to businesses, the extra work for bankers, and the simple convenience of paper money have worked together to keep the coins from gaining much traction in the marketplace.

-The government subsidies so many industries, the gov/fed continually introduces a larger supply of money, fractional reserve banking basically creates money from nothing…theoretically, how is the government putting two cents in to the economy to generate one cent any different?

 

[myp]

The only coins in this system would be the dime and the fifty-cent piece; the quarter would need to be removed due to using the hundredths place.

You could still keep the quarter though- eliminating the 1 and 5 cent pieces does not mean you need to get rid of quarters to round to .50 etc (although I guess .50 pieces make more sense in that case)

-Every attempt to introduce the dollar coin has been so thoroughly rejected by the US markets that the government has billions of these coins stored in a Scrooge McDuck style vault. The added cost to businesses, the extra work for bankers, and the simple convenience of paper money have worked together to keep the coins from gaining much traction in the marketplace.

It has been rejected because it didn't consist of a large portion of all dollars and because paper dollars were easily available alongside the coins. A substantial increase in the coinsaper ratio would surely lead to greater coin usage if only because the market was forced to do it. It might seem inconvenient, but it'd still work and it might even encourage more electronic use reducing the need for physical one dollars all together.

-The government subsidies so many industries, the gov/fed continually introduces a larger supply of money, fractional reserve banking basically creates money from nothing…theoretically, how is the government putting two cents in to the economy to generate one cent any different?

Because you are adding to the deficit since these are fiscal transactions. Fractional reserve banking or the Fed's open market operations are monetary transactions/phenomena.

That and the extreme case where if the commodities keep appreciating vs. the usd, the incentive to meltdown pennies and nickels continues to grow over time leading to more and more people doing it (there are already some people who do it but mostly with older coins that have greater percentages of wanted elements).

 

[Schmidt]

if it is costing us more money than its worth and we are in hole with our econmic sitituation
than it seems like a needless extremitie we could do without

like an appendix

 

[DodgeFB]

if it is costing us more money than its worth and we are in hole with our econmic sitituation
than it seems like a needless extremitie we could do without

like an appendix

I would be happy to do without the penny. I only need one to check tread depth on tires.

 

[David]

if it is costing us more money than its worth and we are in hole with our econmic sitituation
than it seems like a needless extremitie we could do without

like an appendix

The appendix is part of the immune system. A secondary part, true but far from useless.

 

[Schmidt]

The appendix is part of the immune system. A secondary part, true but far from useless.

it is a vestegial organ used in the " old " days for processing bones

although if you remove it of course you will have the problems of some kind of systemic reaction if any at all

 

[David]

it is a vestegial organ used in the " old " days for processing bones

although if you remove it of course you will have the problems of some kind of systemic reaction if any at all

And in the here and now it produces/shelters bacteria that helps with digestion, balances hormones (especially in fetuses) and produces lymphoid cells. It can also be used surgically to rebuild a damaged bladder.

 

[Schmidt]

And in the here and now it produces/shelters bacteria that helps with digestion, balances hormones (especially in fetuses) and produces lymphoid cells. It can also be used surgically to rebuild a damaged bladder.

and can you live without it- yes

 

[David]

and can you live without it- yes

You can live without quite a few things.

 

[Comet]

The most recent numbers have the cost to manufacture a penny at 2.41 cents. This number fluctuates with the cost of metal, particularly zinc, which comprises 97.5% of a penny, with only 2.5% being copper.

 

[Schmidt]

You can live without quite a few things.

so you are defending the fact that the appendix is not a vestigial organ

 

[Schmidt]

so you are defending the fact that the appendix is not a vestigial organ

i say fact because you are implying it like a fact

 

[David]

so you are defending the fact that the appendix is not a vestigial organ

I'm defending the fact that the appendix isn't useless.

 

[myp]

I don't know why you guys are arguing about appendices It's not like its a perfect analogy for the penny...

 

[mogur]

Oh, but the appendage is just like the penny. We don't need it, it used to be good, but we are more evolved than that. Poor people can simply bite their nickels into fifths, the rich don't care two cents, and penny candy is a dime now, anyway. Wax lips, and those little wax tubes with kool-aid in them are still the best at a dollar fifty-five. And as long as I can place a penny on the railroad tracks, I'll always have an inflated penny. At least if we keep railroads running.