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Pennies, the Most Annoying Coin
The penny costs more than it is worth. This is definitely true in terms of production costs but also in that most Americans don’t use pennies. In 2014 alone, 8.15 billion pennies were created. Think about the last time you actually went to the register and used a penny. If you are like me you probably can’t even remember. Most of the time the cashier hands you a penny back and you think, “what the heck can I do with this?" Reasons like this and more prove that there could be a better America without pennies.
Comedians Talk and Joke About Pennies
Pennies—Where Are They Now?
Possibly as much as 66% of all pennies produced are not in circulation—they are sitting in somebody’s piggy bank collecting dust. On average, a penny will last 25 years before being taken out of circulation and recycled. With all these treasure troves of pennies waiting to be used, our government should just cease production and use the existing pennies. Over 9 billion pennies were ordered by banks in 2015, and although they use them, the average citizen does not. Even Philip Diehl, former director of the U.S. Mint, voiced his opinion in 2015 that the penny should not be produced anymore.
American Views on the Penny
This pie chart above shows that 55% of Americans say the penny is useful and production should continue, 43% say that it should be discontinued. Back in 1993, a ABC news poll reported that 64% of Americans thought the penny was needed, and 33% thought its production should be stopped.
How Frequently Are Pennies Used?
Environmental and Financial Cost of a Penny
A penny costs about 1.4 cents to produce, although the cost has been higher than 1.6 cents. The true cost when considering all the mining for the raw materials, transportation, and the minting process makes the penny worth even more and strengthens the argument against them. A government report in 2014 found that there is no way to make the penny any cheaper to produce. The composition of the penny has remained about 98% zinc and 2% copper since 1982. In 2014 563 tons of copper was used to make pennies, this is huge considering that also in 2014 a meager 98 tons of copper was used in products bought by consumers. This includes all appliances, electronics, ammunition, and more. Pennies are not more important than selling products that actually make a profit.
Penny Production at U.S. Mint
A Taxing Problem
Another big reason the penny has not already been discontinued is that it would mess with the economy. Think about how many items end in .99 in the store—without the penny, the prices would have to be rounded up. Some say that every item in the store would have to be rounded up, but in reality, all you would have to do is round up at the register. The price of gasoline always ends in fractions of a penny, so they would face rounding up as well. State sales and meal taxes also make use of pennies.
More Nickels, More Problems
Yet, without the penny, the nickel would logically be used more, as prices would have to be rounded to the nearest 5 cents. But nickels cost even more to produce than pennies, fluctuating in fractions of a penny between 7 cents and 8 cents. In the past, the nickel has reached over double what its face value, costing 11 cents to produce. Without the penny, it would mean more nickels would be needed and thus the government would lose even more money. The U.S. Mint calculated that without the penny. the United States would need double the amount of nickels annually than is currently produced. Also, without the penny, the U.S. Mint buildings would shut their machinery down, but still cost money, over $40 Million according to the U.S. Mint.
Canada Stops Penny Production
Why Can't We Do It Too?
Other countries have found a way to ditch the penny or similarly lowest-valued coins without catastrophic results. This includes Canada, Netherlands, Brazil, Israel, Britain, Finland, Australia, and Sweden. It has seemingly worked out well for these countries so America should follow suit. It seems when it comes to making sense of making cents we have fallen behind as a nation.
Ben Franklin's Wisdom
Benjamin Franklin famously stated, “a penny saved is a penny earned.” You have to remember that was back when the penny had real value and could buy a candy bar. Still the spirit of that quote, being smart and saving money, still is applicable today.
Physical Currency Is Declining
An increasing amount of Americans are using different payment options that make physical currency like coins and bills unnecessary. Credit cards have been around for decades and are accepted basically everywhere, eliminating the need for physical money. Ever since its creation, eBay has accepted the use of PayPal, which allows people to transfer money to and from their bank accounts. Now many popular retailers accept PayPal online. There is also Apple Pay which allows people to pay in stores via a smartphone. And Google wallet as well. With all of these various payment options over a third of all Americans (39%) don’t even carry around coins or dollar bills when they go to physical stores to shop.
This content reflects the personal opinions of the author. It is accurate and true to the best of the author’s knowledge and should not be substituted for impartial fact or advice in legal, political, or personal matters.