Should the penny be abolished?

[Lief 🗽]

http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2008/02/29/national/w084603S20.DTL&feed=rss.business

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I'd have to agree with Paulson. The penny is nearly useless. I throw them in tip jars every chance I get.

[True Federalist (진정한 연방 주의자)]

Yes, and next year would have been the perfect time to give this coin the send off it deserves.  Rather than celebrating 2009 with multiple designs before settling on a new Lincoln penny design that Illini hope lasts another 50 years, we should have chonse to celebrate 2009 with muliple designs as we retired the penny from circulation.

[Ban my account ffs!]

No.

It is ridiculous that we are at a point where getting rid of the penny would make sense.

Prices would inevitably be rounded UP to the nearest 5¢ while wages would be rounded down or remain unchanged.

[2952-0-0]

No.

It is ridiculous that we are at a point where getting rid of the penny would make sense.

Prices would inevitably be rounded UP to the nearest 5¢ while wages would be rounded down or remain unchanged.

We've come to the point where the penny is worth less than the copper it's minted on. So someone can now make big bucks by collecting pennies, melting them, and sell them to the US Mint (or the mint of any other country). So either they design pennies that shrink in radius every ten years, or they abolish it entirely.

[dead0man]

Get rid of it.  Round everything up to the nearest nickle, call the difference a "tax" and lower the income tax in the lowest brackets that actually pay an income tax.




Now somebody can call me unlibertarian.

[John Dibble]

No.

It is ridiculous that we are at a point where getting rid of the penny would make sense.

Prices would inevitably be rounded UP to the nearest 5¢ while wages would be rounded down or remain unchanged.

That's my biggest concern here. I think we should instead just find a cheaper way to make pennies - change to a cheaper material, cut holes in the middle like some countries do with their coins, make them smaller, etc.

[True Federalist (진정한 연방 주의자)]

I think we should instead just find a cheaper way to make pennies - change to a cheaper material, cut holes in the middle like some countries do with their coins, make them smaller, etc.

We've already redone the penny multiple times, the latest being in 1982 when the current copper-plated zinc composition was chosen.  given the desire to maintain a visual difference with the dime, aluminum is not an option.  That leaves either copper-plated steel (as is used in the Canadian penny at a cost of about 0.8¢ each) or a radical redesign.  I can't see a radical redesign as being accepted by the public, so while we could probably eke out a few more years for the penny by switching to a steel core.  Copper-plated aluminum would be cheaper, but is probably out of the question as copper-plated zinc has problems as it is with corrosion due to the difference in the electronegativity of the two materials and the difference is greater with copper and aluminum.

As for the suggestion of using a hole, while holes are useful for making coins more easily distinguishable, they don't save much in materials cost.  Assuming you keep the same diameter and make the diameter of the hole as wide as the radius of the ring of metal around it, you've only managed to reduce the materials used by 1/9.  However, I suppose StatesRights would approve of putting a hole in Lincoln's head.

[Meeker]

The Salvation Army claims they would lose millions of dollars in donations each year if we abolished the penny. Why do you all hate poor people?

[JSojourner]

I'd like to know whatever happened to 50 cent pieces.  I mean, I used to get them all the time.  Now, almost never.  I thought they were great!

[Stranger in a strange land]

why not just make it smaller to use less copper or make it from cheaper metals, or even from plastic?

[dead0man]

The Salvation Army claims they would lose millions of dollars in donations each year if we abolished the penny. Why do you all hate poor people?

Mainly its the smell....but the reasons are varied and numerous.

[dead0man]

I'd like to know whatever happened to 50 cent pieces.  I mean, I used to get them all the time.  Now, almost never.  I thought they were great!

Everybody collected them out of existence or gave them to their grand kids who shoved them in their underwear drawer never to be seen again.  At least that's where I kept the 2 or 3 I had as a child.  They did it right with the quarters, they made so freggin many of each that they will never be collectable.  If only Americans would embrace the dollar coin like all sane peoples everywhere.  Actually, it probably doesn't matter anymore...who carries cash?  I keep a $20 bill in my coat pocket for emergencies (like $20 would help in an emergency:) ) but never ever use it.  It's all debit or credit card anymore.

[John Dibble]

We've already redone the penny multiple times, the latest being in 1982 when the current copper-plated zinc composition was chosen.  given the desire to maintain a visual difference with the dime, aluminum is not an option.  That leaves either copper-plated steel (as is used in the Canadian penny at a cost of about 0.8¢ each) or a radical redesign.  I can't see a radical redesign as being accepted by the public, so while we could probably eke out a few more years for the penny by switching to a steel core.  Copper-plated aluminum would be cheaper, but is probably out of the question as copper-plated zinc has problems as it is with corrosion due to the difference in the electronegativity of the two materials and the difference is greater with copper and aluminum.

Well, as I said, stick a hole in the middle. That'll counter any change in material to maintain a different look. You might also be able to change the shape instead - make is square or better yet an octagon, though there might be some issues with machines that use coins with that. (not that too many of those use pennies nowadays) The treasury needs to stop thinking in such outmoded ways and figure out a good solution.

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If you've reduced materials by 1/9, then you might not get a significant savings on each coin individually, but long term you would get a good chunk of change. Let's say we switched to steel cores and use the Canadian price of 0.8¢. Cutting out 1/9 of the material could make it about .71¢ per coin produced. The US government produces about 7 to 8 billion pennies every year. You would save a net $6.3 to $7.2 million annually. Sure, that's not much in terms of the federal government's budget, but it's still a significant amount when it comes down to it. If we use aluminum then we'll get less savings per penny, but it still over time it adds up.

[Grumpier Than Uncle Joe]

I could care less.......I never use change except in parking meters.

I end up with about $500 bucks when the jar gets to the point I can barely lift it.

[True Federalist (진정한 연방 주의자)]

I'd like to know whatever happened to 50 cent pieces.  I mean, I used to get them all the time.  Now, almost never.  I thought they were great!

By 1964, the price of silver reached the point where the dime, quarter, and half dollar were worth more to melt than to spend, so the government decided to redo them, but they didn't redo them all in the same way.  Starting in 1965, they began minting dimes and quarters that are the same as those minted today in composition, but they didn't abandon silver entirely as the new half dollar was 40% silver instead of the old 90% silver composition.  While it was a low enough silver composition to make the coins have a higher face value than melt value, it wasn't enough to keep people from hoarding the coins.  It got bad enough that in 1970, the mint only made half dollars for mint sets and proof sets as they waited for Congress to pass a law that would allow them to mint the half dollar using the same cupronickel clad composition as the dime and quarter dollar.  By then damage had been done and people were less accustomed to using the half than before. Strike 1.

Then there is the vending machine.  Once upon a time items sold in vending machines often required exact change and few items sold in them were priced high enough as to require a half dollar.  Even when vending machines got more complicated, the fact was that half dollars are the largest coin (even before the SBA was introduced in 1979, full size dollars hadn't been commonly used in decades)  and so eliminating the half dollar from the accepted coins meant that it was easier to design and build vending machines, so they generally didn't bother.  Strike 2.

Finally, there's good old fashioned human psychology.  While humans have shown through the years and many countries that they need at least one unit of money between adjacent multiples of 10, they don't really need two such units.  The 2¢ coin never took off in this country.  $2 bills suffered the same fate. And the $50 bill is less used than either the $20 or the $100.  There's no intrinsic advantage beyond being what people are used to for filling the void between 1 and 10, but if other factors cause one of two intermediate values to decline in use, it rarely manages a comeback.  Strike 3.

[True Federalist (진정한 연방 주의자)]

I end up with about $500 bucks when the jar gets to the point I can barely lift it.

Then use a smaller jar.

[StateBoiler]

No.

It is ridiculous that we are at a point where getting rid of the penny would make sense.

Prices would inevitably be rounded UP to the nearest 5¢ while wages would be rounded down or remain unchanged.

I've thought about this and this is how you arrange it. Increase the price of everything by two cents and always round down to the nickel in cash transactions.

$0.96 goes to $0.98, you pay $0.95, decrease of $0.01 in cost
$0.97 goes to $0.99, you pay $0.95, decrease of $0.02 in cost
$0.98 goes to $1.00, you pay $1.00, increase of $0.02 in cost
$0.99 goes to $1.01, you pay $1.00, increase of $0.01 in cost
$1.00 goes to $1.02, you pay $1.00, no change in cost

So if you add $0.01, $0.02, -$0.01, and -$0.02 together, sometimes you get money back and sometimes you give money back. Over the long run that comes to no change in amount paid. And it'll save the country an exorbitant amount of money from manufacturing pennies. The only people that want to keep using the penny are the State of Arizona and the zinc lobbyists, cause most of the zinc mined comes from Arizona.

[StateBoiler]

I'd like to know whatever happened to 50 cent pieces.  I mean, I used to get them all the time.  Now, almost never.  I thought they were great!

http://www.coinflation.com/unitedstates/

According to the great Coinflation website, the metal in the half dollars (from 1916-1964) if melted down would be worth $7.26 due to the price of silver (so a return of 1452% from the original 50-cent face value of the coin). The 1965-1970 half dollar, which was 40% silver, would be $2.97 (594%).

So you could pay someone with a half dollar and they'd gladly take it, but would immediately take it out of circulation as the coin is worth more than 50 cents.

Here's some others:

The penny from 1909-1982 (95% copper) is worth 2.6 cents, or 260% of the face value of the money.

The penny from 1982 to current (97.5% zinc) is worth 0.73 cents, or 73% of the coin's value.

The nickel is right now worth 7.3 cents, or 146% of the face value of the money.

The dime and quarter are each made from the same material, and as the area of the quarter is 2.5 times that of the dime on purpose, they each are worth 24% of the face value of the money.

So for those of you that want to keep using the penny, maybe you should join us in calling for sounder money policy from the Treasury and the Fed such that the value of $0.01 stops becoming more and more worthless. I still use coins and paper money just cause doing so ensures that I don't just go spend carelessly if all I ever do is swipe a card. And those Visa commercials are horrible. That's why this country is in so much debt by making people's only connection to spending money is a piece of plastic.

[MasterJedi]

I'm neutral on the topic, I could probably be persuaded either way.

[Storebought]

No.

I favor creating a new dollar that is worth precisely ten times of the old one. Then we would have no choice but to accept a penny, since it would be worth two weeks' minimum wage.

A loaf of whole grain bread in old money: $ 2.50
A loaf of bread in new money: $$ 0.25

An entry-level sedan in the old money: $ 22000
An entry-level sedan in the new money: $$ 2200

A starter house in a sunbelt part of the US: $ 125000
A starter house in sunbelt with new money: $$ 12500

It would be like 1940 all over again.

[Hatman 🍁]

I'd like to know whatever happened to 50 cent pieces.  I mean, I used to get them all the time.  Now, almost never.  I thought they were great!

By 1964, the price of silver reached the point where the dime, quarter, and half dollar were worth more to melt than to spend, so the government decided to redo them, but they didn't redo them all in the same way.  Starting in 1965, they began minting dimes and quarters that are the same as those minted today in composition, but they didn't abandon silver entirely as the new half dollar was 40% silver instead of the old 90% silver composition.  While it was a low enough silver composition to make the coins have a higher face value than melt value, it wasn't enough to keep people from hoarding the coins.  It got bad enough that in 1970, the mint only made half dollars for mint sets and proof sets as they waited for Congress to pass a law that would allow them to mint the half dollar using the same cupronickel clad composition as the dime and quarter dollar.  By then damage had been done and people were less accustomed to using the half than before. Strike 1.

Then there is the vending machine.  Once upon a time items sold in vending machines often required exact change and few items sold in them were priced high enough as to require a half dollar.  Even when vending machines got more complicated, the fact was that half dollars are the largest coin (even before the SBA was introduced in 1979, full size dollars hadn't been commonly used in decades)  and so eliminating the half dollar from the accepted coins meant that it was easier to design and build vending machines, so they generally didn't bother.  Strike 2.

Finally, there's good old fashioned human psychology.  While humans have shown through the years and many countries that they need at least one unit of money between adjacent multiples of 10, they don't really need two such units.  The 2¢ coin never took off in this country.  $2 bills suffered the same fate. And the $50 bill is less used than either the $20 or the $100.  There's no intrinsic advantage beyond being what people are used to for filling the void between 1 and 10, but if other factors cause one of two intermediate values to decline in use, it rarely manages a comeback.  Strike 3.

$2 coins are actually used quite often in Canada, but our 50 cent coin is much like yours, as it is rare and people will keep them if they find them.

[KEmperor]

http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2008/02/29/national/w084603S20.DTL&feed=rss.business
Asked Friday whether he thought the penny should be eliminated, Paulson agreed that it would make sense, saying, "The penny is worth less than any other currency."

I'm not exactly sure where he's going with this.  Of course it's worth the least, it's a freaking penny.  It's the smallest denomination of currency.  All others are naturally worth more.

[True Federalist (진정한 연방 주의자)]

http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2008/02/29/national/w084603S20.DTL&feed=rss.business
Asked Friday whether he thought the penny should be eliminated, Paulson agreed that it would make sense, saying, "The penny is worth less than any other currency."

I'm not exactly sure where he's going with this.  Of course it's worth the least, it's a freaking penny.  It's the smallest denomination of currency.  All others are naturally worth more.

Where he's going with this is that compared to the coins of other developed economies, the U.S. penny is the smallest in value of those currently minted and circulating.  It is worth less than the Canadian penny, the Euro cent, the British pence, the Japanese yen, the Danish 25 øre, the Hong Kong 10¢, the Iceland 1 króna, the South Korean 10 ₩, the Taiwan half dollar, the New Zealand 10¢, the Australian 5¢, the Norwegian 50 øre, and the Swiss 5 centimes.  It's also higher that in value than the smallest coin of a number of second tier economies such as the Brazilian 5 centavos, the Chilean 10 pesos, , the Slovak 50 halierov, and the Latvian 1 santīms.

[Ban my account ffs!]

http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2008/02/29/national/w084603S20.DTL&feed=rss.business
Asked Friday whether he thought the penny should be eliminated, Paulson agreed that it would make sense, saying, "The penny is worth less than any other currency."

I'm not exactly sure where he's going with this.  Of course it's worth the least, it's a freaking penny.  It's the smallest denomination of currency.  All others are naturally worth more.

Where he's going with this is that compared to the coins of other developed economies, the U.S. penny is the smallest in value of those currently minted and circulating.  It is worth less than the Canadian penny, the Euro cent, the British pence, the Japanese yen, the Danish 25 øre, the Hong Kong 10¢, the Iceland 1 króna, the South Korean 10 ₩, the Taiwan half dollar, the New Zealand 10¢, the Australian 5¢, the Norwegian 50 øre, and the Swiss 5 centimes.  It's also higher that in value than the smallest coin of a number of second tier economies such as the Brazilian 5 centavos, the Chilean 10 pesos, , the Slovak 50 halierov, and the Latvian 1 santīms.

Because the dollar is weak right now.

If you use this logic, then Europe should get rid of the €.01 and Britain should drop the pence piece.  One euro cent spends in Europe just like a penny in the U.S.  You can't use the whims of the currency exchange to justify dropping types of coins.

I would argue that the actual value of a penny is higher than the value of a euro cent, as the one euro cent piece is quite small and pathetic and annoying. (the 2 euro cent piece is actually closer to penny sized)

[True Federalist (진정한 연방 주의자)]

Because the dollar is weak right now.

If you use this logic, then Europe should get rid of the €.01 and Britain should drop the pence piece.  One euro cent spends in Europe just like a penny in the U.S.  You can't use the whims of the currency exchange to justify dropping types of coins.

I would argue that the actual value of a penny is higher than the value of a euro cent, as the one euro cent piece is quite small and pathetic and annoying. (the 2 euro cent piece is actually closer to penny sized)

Actually, Finland and the Netherlands have already withdrawn both the 1 and 2 euro cent coins from general circulation because they don't consider the coins worth the effort, though they still remain legal tender there.