The Penny Must Die

http://www.theecjournal.com/single-post/2016/02/14/Why-The-Penny-Must-Die

by elberto34 • 9 years ago

36 95 9 years ago

iLoch• 9 years ago

Not a fan of the "they cost more to make than they're worth" argument. How much does it cost to make a $100 bill?

Nevertheless, we Canadians have been without pennies for a few years now. I have no complaints, just less change, which is nice.

ClassyJacket• 9 years ago

15.5 cents

https://www.federalreserve.gov/faqs/currency_12771.htm

newjersey• 9 years ago

Wouldn't the next logical conclusion be to get rid of cash altogether?

Did I fall for a slippery slope fallacy?

seanalltogether• 9 years ago

At what point is the nickel not worth the effort to keep around as well? It might be easier to sell everyone on the idea of rounding to the nearest 10 cents to keep prices nice and even.

Shivetya• 9 years ago

well I suspect they would just push us to a digital currency and be done with it. slowly take away the small currencies and try to convince people that if they want to save money long term (as in get the penny values back) they need to convert

madeofpalk4• 9 years ago

Places like Australia got rid of 1c and 2c coins (with the 5c being the smallest denomination) long before 'digital currency' was on the minds of anyone.

jejones3141• 9 years ago

The problem with that rounding is that I suspect I know which direction the rounding will always go... and for things like gasoline or water (or even pork chops, which differ in size) there's no way to prevent a price that would require rounding.

mikeash• 9 years ago

I believe other countries solve this by legally mandating fair rounding.

MBlume• 9 years ago

...so what?

madeofpalk4• 9 years ago

Many other countries solve this by just rounding the final price up or down regardless. So if your fuel comes to $100.02, all you pay is $100. If it comes to $100.04, you pay $100.05.

It works fine, no one dies.

djsumdog3• 9 years ago

New Zealand phased out their 5cent coins a decade ago.

robocat2• 9 years ago

Context: NZD0.05 is worth about the same as 0.05USD ‡†

‡ Purchasing power to a citizen of the corresponding country, rather than exchange rate (exchange rate only makes ~30% difference).

† probably quite a good approximation given years difference.

abrowne• 9 years ago

Yes, the nickel is just as bad. New Zealand got rid of their 5¢ coin about 10 years ago, but they had (and have) a 20¢ coin instead of 25¢, so they could easily drop the decimal. My proposal would be to drop the penny and nickel, keep the dime, and replace the quarter with a 50¢ coin.

Coincoin2• 9 years ago

The problem with phasing out nickels is you have to phase out quarters first and replace them with 20c.

bryanlarsen2• 9 years ago

Or drop the dime too and round to the quarter like Denmark did.

M_Grey3• 9 years ago

The persistence of the penny is a symptom, in my view, of just how apathetic and dysfunction the political system is at every level. It's a small annoyance, with a small fix that has been done by other countries with good results. That it isn't done is largely just a matter of people not participating in the process at all, and congress not really doing their job.

It's a small thing, but then, so is a canary in a coal mine. This penny thing has been an irritant for years, and the things presaged by accepting that are starting to emerge... like failing infrastructure.

oceanghost• 9 years ago

Your thinking on the subject is a symptom of something else.

The "question before the question" is-- why is the penny worthless? That's the uncomfortable situation.

M_Grey3• 9 years ago

Your thinking on the subject is a symptom of something else.

Sure, if you're very new to this planet and aren't aware that, "The penny must die" has been published in some form for longer than you've been alive. The actual question isn't engaging, isn't new, and doesn't represent a significant issue facing any of us. The issue behind why we keep regurgitating the same issues and pawing at them like blind fools however, is interesting.

djsumdog3• 9 years ago

The EU still has 1/2cent coins (although I think Belgium no longer allows shops to give them as change).

Pennies are gone in AU/NZ and other south pacific countries.

wronskian• 9 years ago

The Netherlands no longer uses the 1 or 2 cent coins - they are not accepted for payment, even if you have enough to make a round 5 cent amount.

jpatokal• 9 years ago

But many EU countries, including Belgium, Finland, Ireland and the Netherlands, do not. (Technically, they do exist for collectors, but all prices are rounded up/down to the nearest 5c and you never encounter them in daily life.)

astrodust9• 9 years ago

Canada got rid of it a few years ago despite all the wild-eyed hysteria surrounding the phase-out. Senior citizens did not go bankrupt, stores selling inexpensive items did not go under, and a myriad of other nonsense proved to be utterly unfounded.

A penny is so worthless these days even homeless people throw them out.

Visiting the US is like visiting a time machine where pennies and dollar bills still exist, where chip and pin is only just coming into fashion, and where "checks" are still used for ordinary transactions like buying groceries.

madeofpalk4• 9 years ago

A huge feature of the AU detonation system is that we actually give the coins sensible names. Instead of making up confusing names like penny and nickel and what not (which I can never remember what they are, no matter how much time I spend in the US). Just call them by their face value and be done with it.

There's a particular coin in the US that doesn't actually say the value on it anywhere - it's particularly annoying.

jwilk3• 9 years ago

For a moment I thought you were talking about half-cent coins.

majewsky2• 9 years ago

The EU still has 1/2cent coins

I was confused there for a second because "1/2cent coins" looks like "half-cent coins", where you actually mean "one-cent and two-cent coins".

And yeah, I would like to see these go. I refer to them simply as "Buntmetall" (a German word that translates literally as "colored metal"; appropriate since the small coins are brown-ish) and throw them away at any occasion.

drfuchs• 9 years ago

At least as far back as the 1970's, every time our civil servants in the treasury ask congress to let them stop making pennies, the John Birch Society types raise such a stink about how this is a communist conspiracy to enable world government, that the politicians drop it as not being worth the fight. Source: Michael Blumenthal, Secretary of the Treasury 1977-79.

mnm1• 9 years ago

I know voting turnout is sadly low, but that does not constitute people not participating in the process. Senators and representatives are elected. These representatives' failure to do their job does not constitute a failure on the part of the people to do their job (voting). Pretending like people could do more when the system simply does not allow it is disingenuous and takes the blame away from where it rests: the elected representatives who refuse to do their jobs. And let's not pretend that calling/emailing/mailing/tweeting/etc. representatives is something that should be required to get our representatives to do their job. What kind of responsible, decent person needs to be prodded tens of thousands of times before they do their job?

M_Grey3• 9 years ago

I know voting turnout is sadly low, but that does not constitute people not participating in the process.

...It's the most basic level of participation; if that's not failing to participate in the process, what is? You're welcome to rail against the entirety of the history of who politicians are and how they behave, but it's at your peril.

In the same way that you can't just turn a computer on and leave it alone forever, you can't do the same thing with government. Politicians have always been, and will probably always been unrelentingly worthless scumbags.

raverbashing3• 9 years ago

Yes, several countries have done away with the smallest denomination. Nothing to miss about carrying less coins around

But the $1 bill really ought to be a coin instead

dkresge• 9 years ago

Chaos aside, I wonder what the impact would be of simply declaring that all pennies are now worth $1. Based on circulation ca. 2009 it would imply a $1.65 trillion "conversion"; ~10% of GDP.

ghaff7• 9 years ago

But the $1 bill really ought to be a coin instead

There have been various efforts at dollar coins and they've never really taken off.

I would hate this. I don't use a lot of cash in general but I really like the fact that, when I do use cash, except for some quarters I save for parking meters, coins are basically in the dump in a jar when I get home value. I dislike when I travel to UK/EU that there's coinage of sufficient value that I can't just ignore my loose change.

If I have to use cash I'd much rather just use bills. Coins require some sort of different container to carry them.

Retra• 9 years ago

They've never taken off because they get cancelled too soon. And now everyone knows a new dollar coin will get cancelled, so why bother doing anything to support them?

astrodust9• 9 years ago

The whole point of having a $1 coin is so buying something like a can of coke or paying for a parking spot doesn't involve stuffing ten or quarters into the machine. It's two or three coins if you're doing it right, max.

Parking meters. Laundry. Vending machines. Public transit. These are all things made immeasurably better by having coins that have value.

I can't just ignore my loose change.

Sure you can. Back when I was still using cash I'd just dump it all in a jar and at the end of the year I'd have at least $800-1000 of savings.

It's also nice that with a single coin you can buy something. A bagel? A muffin? A coffee? If you shop at the right place you might even be able to swing a muffin and a coffee for a single coin.

You really can't get much for $0.25 these days. Even a pack of gum is vastly more than that.

raverbashing3• 9 years ago

Yes it requires a different container. It's called a pocket. Or a coin purse, which can be easily found.

And it saves space, both in the wallet and in my pocket.

Phlarp• 9 years ago

They've tried multiple times now. The public loves their greenbacks.

dEnigma2• 9 years ago

As a European, I feel the exact opposite about the 1€ coin. I would much rather have a paper bill. The coins make my wallet heavy and tend to fall out far easier than bills.

astrodust9• 9 years ago

What are you doing putting coins in your wallet? That's your mistake.

You're also highly unlikely to have more than 3 or 4 of those. If you have 5 just trade up for a bill. Most stores will be very grateful to get some change back.

Animats2• 9 years ago

The US has dollar coins. They're not used much, despite decades of efforts from the US Mint to promote them. It's getting hard to get a roll of them from a bank. There are Susan B. Anthony dollars, Sacajawea dollars, and U.S. President dollars, all compatible.

If you want some, go to a US post office, put a $20 bill in the stamp vending machine, and press coin return. The older machines give change in dollar coins.

sbierwagen• 9 years ago

Metro ticket machines in Seattle also give them in change.

raverbashing3• 9 years ago

Last time I was at a US Post Office I had to use a credit card to buy a stamp.

Guess those machines are being phased out

david-given• 9 years ago

Well, I'm from Europe --- and I can't stand the dollar bill. It's just too niggling an amount of money to be worth getting my wallet out for. Whenever I visit the US I always ask for change in dollar coins instead of bills (which tends to get some rather odd looks), and once in Dallas I resorted to feeding banknotes into a DART ticket machine, because it would give change in dollar coins.

In the UK, where I grew up, the smallest (proper) banknote is five pounds (worth about seven dollars). (The (proper) is because there are still some Scottish one pound notes floating around. I believe they're still valid, but they're not printed any more and so are decades old and disgusting, and you need to be really unlucky to see one.) In Switzerland, where I live, it's ten francs (worth about ten dollars). Switzerland actually has five franc coins, which are amazingly chunky things.

...the smallest coin in Switzerland, BTW, is five rappen (one rappen is a hundredth of a franc). The two rappen coin was deprecated in 1978, and the one rappen coin in 2007.

djsumdog3• 9 years ago

The reason why we have money is so that they can facilitate trade of goods and services so that we don’t have to barter like savages.

This is entirely wrong. In high school you're taught that we went from barter to money to credit, but in reality, the earliest human economies were credit based.

People sometimes say, "x society collapsed and reverted to barter," but in every case, they "revert" to the currency of trade from the previous state .. or they use something generic like "Oxen" but they never actually trade in real Oxen; they just use it as a unit of measure.

I do agree the penny should be deprecated, and I know it sounds nit-picky, but myths like this prop up a narrative that doesn't match with history, and it distorts our perception of what money and markets truly are.

I highly recommend the book Debt the First 5,000 Years, as it goes into great detail about the history of debt, money and slavery.

zer00eyz• 9 years ago

There is a basic problem with this argument.

There are lots of places in the world that accept and use the dollar as a means of trade, where the penny is still of value.

https://qz.com/260980/meet-the-countries-that-dont-use-their...

What amounts to a rounding error for most Americans would quickly add up in places that depend on the dollar for currency (official or un officially) as they typically have larger marginal populations.

reddytowns• 9 years ago

This is not the problem of the USA.

astrodust9• 9 years ago

If somewhere the economy of a country is built on melting down pennies and making brass statues that's also not the problem of the US Mint.

planteen• 9 years ago

Huh? Ecuador uses the US dollar and issues their own coins.

https://en.m.wikipedia.org/wiki/Ecuadorian_centavo_coins

Americans were able to trade fine in the past when a penny had far more purchasing power. Other counties will manage.

robocat2• 9 years ago

And they should keep using pennies but valuing them at the base metal value ...

herbst2• 9 years ago

Afaik most of them use their own currency instead of american coins. Like in cambodia everything below 1$ is handled in their own currency

jwilk3• 9 years ago

Archived copy that can be read without JS enabled:

https://archive.fo/wM6HU

Animats2• 9 years ago

The penny lobby [1] is a front for the zinc industry. Mostly Jarden Zinc Products.

[1] http://www.pennies.org

jackyinger• 9 years ago

When I visited India I found that one rupee is the smallest increment offered. It's very roughly equivalent to the American nickel. Even though cost of living there is much cheaper, the coarser grain of currency does not cause trouble.

When available currency has limited resolution merchants simply adjust their quantities to match.

Wouldn't it be nice to just pay 3.50 and get a tad more product than 3.37 and futz with the change?

Taniwha3• 9 years ago

The problem in the US with getting rid of pennies is that the US does not quote prices with sales tax included (unlike every other country on the planet). If you do that then you can quote prices at appropriate price points (4.25, 5.95 etc)

Of course if you get rid of the penny then rounding only occurs when you pay with cash - when you pay with a card you still get to pay to the penny

ghaff7• 9 years ago

unlike every other country on the planet

That's not true at all. Many prices (in restaurants but also elsewhere) in both Canada and Europe don't include sales tax/VAT.

girvo• 9 years ago

In Australia and New Zealand it's certainly true.

herbst2• 9 years ago

Never seen that in europe. Examples?

maxerickson2• 9 years ago

What's wrong with rounding?

Taniwha3• 9 years ago

Nothing, but you don't need to round when you use a card

DerekL• 9 years ago

Some restaurants and coffee shops already display prices with tax, and round everything to the nearest nickel.

unabridged• 9 years ago

Americans are too sentimental, its why we could never switch to the metric system. And congress voting to get rid of the penny is so low on priority I wouldn't count on it happening soon.

Pennies are made because there is demand. If businesses stop requesting rolls of pennies, the mint would make less of them. If you want to get rid of pennies lobby businesses to round their after tax prices to the nearest nickel. Just McDonalds and Walmart dropping the penny might cut the amount in circulation by a significant amount.

jwilk3• 9 years ago

Do other countries have nicknames for their coins?

In Poland, if you want to talk about a particular coin, you use its denomination.

Taniwha3• 9 years ago

In NZ we used to have names like shilling and florin etc, we ditched them when we went decimal

ghaff7• 9 years ago

The flip side of US denominational conservativism that appeared starting in, oh, the 1950s or so is that $20 bills are effectively the maximum value you can depend on being routinely accepted.

I get $100 bills to travel overseas (and they're routinely accepted if I'm using US currency for something). But I'd in no way depend on getting a $50 or $100 accepted in a US store. I admit that I see fewer signs to that effect these days than I maybe did in the past but I do have to go int to a bank teller if I want to get $100 bills for travelling.

majewsky2• 9 years ago

Obligatory link to John Oliver discussing the same topic in his usual manner: https://www.youtube.com/watch?v=_tyszHg96KI

The Penny Must Die

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