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A Penny Abolished Is Two Pennies Not Collected Through Coercive Taxation
Last week Mrs. Cole and I took a trip to Niagara Falls. For those of you who don’t know, Niagara Falls is right on the border between the United States and Canada. So there’s a Canadian side and an American side. On this trip we stayed on the Canadian side and spent most of our time there. (By the way, everyone says the Canadian side is nicer and that is accurate. The American side looks like Atlantic City away from the boardwalk.)
Canada is, in theory, a foreign country. But if you live in upstate New York… well, not so much. Going to Canada is a lot like going to Vermont (or it used to be). I see as many cars with Quebec and Ontario license plates as I do Vermont plates.
For those of you who live in other places, we get Canadian pocket change mixed in from time to time. Canadian nickles, quarters, dimes and, of course, pennies, are the same size as their American counterparts, so you may not even notice. (Except that they don’t work in machines.)
But on our trip to Canada, I noticed this sign:
Canada, you see, having already banished the one-dollar bill in favor of a coin with a duck on it (the Canadian constitution requires all coins to have either a bird, a beaver or a caribou on it), is doing away with the penny. Transactions will now be rounded to the nearest nickle. There was a period of transition and a public information campaign and therefore it has been easy and drama free.
‘Nuff said.
Except it’s not ’nuff said! Not for nothing, but how the hell are Canadians ahead of us in this regard? Pennies are damn near useless.
Each penny the US government mints costs between one and a half cents to two and a half cents to mint (I’ve tried to nail down a more precise figure, but it depends on the cost of the metal and when you’re asking). Between pennies and nickles (also damn near useless) its costs 105 million dollars more to mint them than they’re worth.
Now, when you’re talking about a country with a 17,000,000,000,000 dollar national debt, 105 million dollars is small potatoes, but its still 105 million dollars that needs to be taken by force from someone (ME) or borrowed from Communist China.
And that 105 million dollars is just the government’s losses on the penny. Add to that the handling costs of all those pennies in a country with 300 million people. Every business has to have pennies. Every consumer who makes a cash purchase gets them in change, and since each of those pennies only has a third the buying power it had when I was born, they aren’t worth spending. That means we either have to spend time rolling them, fill mayonnaise jars with them, or worse.
If we abolished the penny, not only would less money need to be taken from my pocket, but we could banish this copper colored menace from our lives. You won’t notice, I promise. Mrs. Cole and I didn’t notice at all last week, especially since we paid for everything with cards.
Published in General
I think pennies are great and here’s why:
They have Lincoln on them (I am also a fan of the $5 bill).
You can make a battery using them
You can run them through those machines along with two quarters and produce a cool thing
You can use them as counters
You can use them as poker chips
That is all.
In order to pay for one gallon of gas, I need nine 1/10 pennies.
The common loon is not a duck!
I bet those prices would remain, and the vendors would simply round up when they calculate the total. If you buy five items you’d save a nickel though!
I’m with Fred – let’s deep six the penny.
Whenever a retail clerk gives me pennies I leave them on the counter – my little civil disobedience.
Okay, valid points perhaps, however
Are those things worth the costs?
Oh, I am well aware.
How much are my taxes going to go down once the pennies are no more? Because I don’t rightly know. Lessee, according to this, it costs about $120M to mint pennies. They go on to say it really costs $900M, but they don’t tell us how they get to that, but we know it costs the government the $120M, so let’s use that. There are about 400M people in the US, right? So it costs me about about $.30 each year to have pennies? I’m probably not figuring that right and it probably really costs me double, maybe even triple. So, yeah, to me it’s worth a buck a year to have all those things.
Oh don’t get so upset, Fred. I’m just funnin’ with ya! I don’t give a hoot one way or the other. The money we save is chump change in the grand scheme. But you are correct, the pennie is durn near useless.
We can get rid of the penny and just cut the nickels into pieces and weigh the parts to get the correct amounts….
Fred, one small quibble. The bird on the Canadian $1 coin is a loon, not a duck. Hence it’s common nickname: Loonie. No kidding.
It seems that Fred knows it’s a loon, but it’s a common misconception that loons are a type of duck.
Canada missed a great opportunity. Instead of calling the $2 coin the “two-nie”, they should have dubbed it the Doubloon. Or is that too piratical-sounding for those nice Canadians?
I think the Corner over at National Review floated this idea about 10 years ago and had to retreat from the resulting outcry. Apparently a certain fraction of the Conservative coalition are never-change-anything-ever Conservatives, and they made themselves heard. Very loudly.
I take it Ricochet has rather fewer of those Conservatives. Add my name to the anti-penny list. Nuthin’ but a subsidy for Big Zinc anyway, if I’m not mistaken.
Part of that was the Carter Quarter. I think we could make the gold-colored versions (like the Looney) work if we would quit printing dollar bills. For goodness’ sakes, the dollars of today are worth less than a nickel when the Fed was created. Back then, they had coins up to $20 dollars. That was most of what folks used. I constantly buy and use rolls of dollar coins at my financial institution. Most of the places I spend cash, they look forward to my coming in. Admittedly, part of that is that many of the clerks, waitresses, or their children collect coins.
In fact, I would be all for a revamping of the coinage so that a quarter was more the size of a penny, the dollar like a nickel and two dollars like a dime, etc. Then we could get rid of the Fed and stop the planned inflation.
Uh, Fred, we are and always have been on a decimal-based system:
Penny
Dime = ten pennies
Dollar = ten dimes
Eagle = ten dollars
That was how it originally worked. There were other coins as multiples or fractions, including ha’pennies, three-cent nickels, five-cent nickels, quarters, half-dollars, and double eagles. I can’t remember without looking it up, but there were also farthings and mills at times, although I don’t think the US Federal Government produced either. The mill coin was often used for sales taxes, and produced by individual states or locales.
Our forefathers had been under the British system, of course, which before the recent conversion was based on twelves and twenties.
How about a compromise: we eliminate anything smaller than a quarter, but introduce “pieces of eight”. Shave and a haircut, 200 bits.
Right, I understand all that. I’m just saying, in terms of coinage, in America in 2014, we’d need more than just a dime.
I am aware that it is a loon. I thought I phrased that sentence (including the parenthetical) so as to make clear that line was tongue-in-cheek.
Fred,
You were not clear. Be humble and don’t duck responsibility. It makes you look like a coin from up north.
It’s an excellent proposal. My only objection would be the loss of a coin bearing Lincoln’s likeness. Happily, however, Congressional action on the point could easily establish the new Lincoln dime, for the betterment of all.
of course the removal of the penny is effectively admitting that our money has becomed so devalued that absolutely nothing (like a stick of gum) costs a penny or even less than a nickel.
There’s a really great joke you can do with a Canadian $20 bill.
It goes like this: an American guy goes up to Canada to do some moose hunting. He stops at a little outfitters store and gets some gear, and the guy asks if he’s got his moose tag. He says yes he had. But the proprietor shows the man a $20 bill and says “Does it look like this?” “Nope, it doesn’t, do I need that?” says the American. “Heck yeah, he says, and as you can see, it’s good anywhere in Canada, for 20 years, and it’s even endorsed by the queen! That’ll be $100 US please!” Glad that he was warned he buys the $20 for $100 US and goes on hunting. He gets his moose, and he’s just tying it onto the back of his truck when a game warden comes buy. “Do you have you moose tag, fella?” says he. Pulling out the $20 bill the American says “Oh yes, here it is, you can see it’s good anywhere in Canada, for 20 years, and it’s even endorsed by the queen.” (cont’d)
The game warden looks at him funny and says “Boy, you’ve really been had, haven’t you. Anyone can see by looking at the back that this here is a duck hunting license. Now I’m gonna have to fine you $100!”
Why eliminate the penny for transactions? We just need to eliminate the minting of new pennies. There are a gazillion pennies still in circulation, and I am sure it will be a very long time before the banks and retailers run out of pennies. Heck, you just have to find those few hoarders out there that have a five gallon buckets full of them, and convince them to cash them in at the bank.
The estimate is that there are between 140 and 200 billion pennies in circulation. A really rough estimate is that they create about 5 billion new pennies per year over the last ten years. So, we might run out of pennies in about 40 years at that rate, if we just quit producing them.
Personally I try to not carry coins worth less than a trillion dollars.
Would it be possible to abolish pennies but still allow electronic transactions to be legally divisible down to the cent?
Yes, I think just about all proposals on the table would do that. My understanding is that transactions on military bases work that way today.
Pennies were useful before the Age of Plastic. For a transaction totaling 99 Cent, the cashier had to punch in the amount and open the till, registering the transaction. No skimming allowed.
Plastic has changed all that.
BTW, regarding the various dollar coins: I think what killed them was the political correctness, and the stingy design. Put a Rushmore-grade president on the obverse, and make them bigger and heavier than a quarter, and people will believe you really can pack 100 pennies worth of value in that thing.