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Editorial: Put penny out of its misery

Sunday, May 6, 2012
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Few people will stoop to pick up those pennies that are dropped (or thrown) on the ground these days, and there’s a reason: The coins are practically worthless unless you’ve got a ton of them, and almost no one besides a numismatist will argue that point. So why does the government still insist on making them?

The cost of minting each penny, which is now 97.5 percent zinc and only 2.5 percent copper, rose to 2.4 cents last year. Thus the government spends $100 million annually to create what, for most people, is mostly a nuisance. Yes, pennies occasionally come in handy to pay sales taxes, but you can’t actually buy anything — even a gumball — with them anymore. And with increasing numbers of consumers using plastic to pay for their purchases, there’s less need for pennies than ever.

In Canada last week, where the currency is virtually on par with ours, the government took the first step in phasing its penny out of circulation: It minted its last cent. According to a Wall Street Journal story, the country will continue distributing its inventory of remaining pennies for the next few months, while Canadians are encouraged to reduce their own stockpiles by donating them to charity. Then the government will embark on a plan to take the coins out of circulation, melting them down and selling their component metals (4.5 percent copper and 95.5 percent steel). The move will eventually save the Canadian government $11.15 million annually.

We’d like to see the U.S. government follow suit, not just because of the savings but the quality-of-life issue. There’s just no point in pretending that pennies have value, and carrying them around just to round off sales to the nearest nickel — or getting a bunch of them back when paying for something with larger coins — is a pain.

At the very least, to save money the U.S. should alter its penny’s composition, using steel instead of zinc and copper, as was done briefly during World War II. That wouldn’t save a lot, just 0.4 cents per coin, but it would be better than nothing.

Best of all would be to kiss the penny goodbye. Letting retailers round up or down to the nearest nickel wouldn’t be a burden on anyone, or very inflationary: some sales would round up, others down.

Maybe there’s even a way for those cents in the middle to be donated to charity. Then there would be no incentive for anyone to game the system, and the windfall would go to a worthy cause.

 
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comments

May 6, 2012
9:17 p.m.
myshortpencil says...

Exactly why has our currency become so devalued that a penny is worthless? That, by far, is the bigger problem.

May 7, 2012
10:37 a.m.
tonijean613 says...

Pennies, especially older ones, are made out of a precious metal (copper) and has real value. The only people trying to game the system is the bankers- They profit from taking a precious metal out of circulation. The devaluing of money comes from creating money out of paper, which can be easily destroyed in the laundry and more easily counterfitted. The better solution is to move to a real silver dollar coin and get rid of the expense of contantly printing dollar bills. If people want to preserve the value of the US dollar, they should start paying for more of their transactions in cash, and move their money from big banks to credit unions. And keep those pennies circulating so there is no need to continue to coin more.

May 20, 2012
4:08 p.m.
robbump says...

Send me your unwanted pennies!

If we are to emulate Canada, the better move might be to stop printing (and burning, and reprinting, and again burning ....) $1 bills.

One local TV outlet recently did a story about the cost of minting, then storing the "unwanted" presidential dollar coins. But there was no comparison to what we spend to maintain the dollar bills. Do away with the dollar bill and even introduce a $2 coin as well - but don't make any future coins so similar to a quarter as all the dollar coins in the past 25 years have been. Look at an Eisenhower dollar as an example of what a dollar to $2 coin should be.

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