I created this blog to publish my conjectures about life, politics,
religion, & such. A dictionary definition of “conjecture” is:
“A conclusion deduced by surmise or guesswork.”
While I believe what I post in this blog is correct,
my posting are: “My Conjectures”
To Keep the Penny or Not to Keep the Penny,
That is the Question?
On February 10, 2008 on 60 Minutes the US Mint Director said the US Mint makes about 8 billion pennies each year. Those 8 billion coins are worth $80 million dollars but it costs the mint $134 million to manufacture them. The difference between $80 million and $134 million is $54 million. That $54 million comes straight out of the pockets of US taxpayers.
Note; the following comments only address the consumer use of pennies in the day-to-day purchase of merchandise paid for with cash. The use of cents in financial transactions and payment by check and credit/debit cards would not need to change if penny coins did not exist.
When the Lincoln penny was introduced in 1909 having them was necessary. A first class postage stamp cost only 3 cents. I walked through a drug store and a Wal-Mart and could not find anything priced at less than a dime. So why is our government wasting millions of dollars each year printing pennies?
There have been attempts to eliminate the penny but all attempts have failed. The main argument for use of pennies is that stores will have to round to the nearest nickel and you will have to pay more. If you only buy one item that is priced at 6.98 and there are no pennies you will have to pay $7.00 and the store will have an extra profit of two cents. That is true but for most trips to the store several items are bought and the law of averages will protect you. For example; if you buy items priced at $3.99, $8.97, $1.99 and $18.97 the total will be $33.92 and you will pay $33.90. For any items that cost less than a nickel, if there are any, they can simply be repackaged or resized so they cost a nickel.
The 60 minutes report indicated that the real reason we still have the penny is because of the high powered lobbying effort of the Zinc industry. Pennies used to be made out of copper but when the price of copper skyrocketed the mint switched to using zinc for the core and only a small amount of copper for the plating so it would still look like a penny. It is the Zinc lobby that is promoting the round-up story so they can still sell large amounts of Zinc to the US mint. The fact that one industry may be hurt a little is not justification for our government wasting $54 million dollars each year in the production of a needless coin!
Because of the 60 Minutes report there will hopefully be another attempt to stop using pennies. I recommend that you show your support by writing your representatives in Washington. Regular e-mails to them do not help as they are usually deleted by their spam filters. A snail mail letter is best but you can also use your representative's website feedback form. Contact information for your representatives can be found at www.house.gov and www.senate.gov.