Until last week I considered myself neutral on the entire penny issue. A recently published report sponsored by Americans for Common Cents (a pro-penny group backed by zinc companies) documents the effects if the Federal government were to take pennies out of circulation. Some of these negative consequences includes an effective 600 million dollar “rounding tax”, erosion of consumer confidence, and increase in the national deficit.
I believe this report should be viewed with extreme skepticism. Aside from the copper coating, pennies consist of 98% zinc. I will admit upfront that I have no previous experience with the zinc industry or how it operates, but I think it is reasonable to believe they make a fair number of dollars producing all those pretty pennies for the US Treasury Department. Every time a penny is lost down between the couch cushions, dropped down a wishing well, or carefully placed in the path of an oncoming locomotive, the zinc industry is there to help produce a brand new one. That doesn’t even include pennies that just get worn out by getting jiggled around in pockets and purses on a daily basis. If pennies were to be taken out of circulation, I don’t think the zinc industry would be very happy.
After reading about how important the zinc industry thinks pennies are to the survival of this country, I started thinking about how pennies fit into my life. Every night I take the change out of my pockets and put it into a jar that sits on my nightstand. Once the jar gets filled up I take it to my bank and put the money into my checking account. The jar goes home and the whole process starts again. If I lived in a world without pennies, I think it would take a little longer to fill up the jar, but the process itself would remain unchanged.
I thought about this long and hard, and I have been unable to envision how pennies make my life any easier. Parking meters and vending machines don’t like pennies. Parking meters swallow my pennies, but don’t allow me to leave my car parked any longer. I guess it’s not worth their time to give them back. Vending machines generally spit the pennies out into the coin return slot. I suppose I would not be too happy if I was waiting behind someone who needed to insert 125 coins before the king-sized Snickers bar dropped out of the machine.
Can our great nation survive without pennies? How can we fairly conduct commerce without the proper tools to pay the exact goods and services? The answer is that we do it all the time without even realizing it. Do you ever stop at a gas station and worry about how you are going to pay for gasoline that costs $1.59 and 9/10ths of a penny per gallon? Do you ever wonder how the gas station can charge 9/10ths of a penny for a gallon of gasoline? Of course not– the gas station just rounds it to the nearest penny when they calculate the total price. Sure, they could set the price at $1.60, but then it doesn’t seem like quite as much of a bargain.
Pennies used to be produced entirely of copper, but in the 1980’s the composition was changed when the cost of producing a penny out of copper exceeded the value of the coin itself. According to Americans for Common Cents, it costs taxpayers 0.72 cents to produce a penny. What are we going to do when, as it did once before, pennies are too expensive to produce? How about pennies with holes in the middle? Or better yet, we could get rid of the metal all together and declare that any scrap of paper with the hand written phrase “This piece of paper is worth one cent” is legal tender up to four cents. At least that way we could all sleep easier knowing that we don’t have to pay 600 million dollars in these so-called rounding taxes.
A sign that pennies aren’t valued in our society anymore can be seen in those little trays near the cash registers of most gas stations. A lot of people believe it’s easier to give pennies to a total stranger than slide them back into a purse or pocket. Do people leave their pennies in the tray because they believe in karma, or is it easier than having the coins stick around in their pockets until laundry day? Personally, I think it’s a little from column A and a little from column B. Either way, it doesn’t speak well for the value of a penny.
In all honesty, I don’t know which course of action is the best for our nation. I’m sure that either way the sun will still rise each morning, another wildly successful boy band will rocket out from total obscurity, and people will find something else to annoy them in their every day lives. Perhaps somewhere down the road I’ll write another article that starts “What’s the deal with nickels? Why are they larger than dimes? Do they REALLY make our lives any easier….”