To access extended pro and con arguments, sources, and discussion questions about whether the penny should stay in circulation, go to ProCon.org. 10 reasons why we should keep the penny. The penny costs an irrational amount of money compared to what it's worth. so at 27 cents per ounce, I am going to have about $270 in value. There will be no sanity in D.C., fiscal or otherwise, until a electoral majority recognizes there is a crisis and places people in office wholl effect a cure. If we don't have the penny. Accessed April 27, 2023. https://www.procon.org/headlines/should-the-penny-stay-in-circulation-top-3-pros-and-cons/, United States Mint, "United States Mint 2020 Annual Report," usmint.gov, 2021, Brian Milligan, "The Penny Coin: Should We Follow Ireland and Phase It Out?," bbc.com, May 8, 2016, The Harris Poll, "Penny for Your Thoughts? ProCon/Encyclopaedia Britannica, Inc. [ 34 ] 5. -Prices will increase because all purchases will have to be rounded to the . This organization has conducted polls showing that more than two-thirds of Americans favor keeping the penny. -- who dumped their low-denomination coins 30 years ago, will be laughing at our senseless jingling. None of these changes caused any significant problems in commerce. If we keep the penny prices will go up to five cents. You're saving it. Those who support getting rid of the penny argue that it is useless, inconvenient and takes up space that could be given to other denominations of currency. 9 Reasons Why America Should Get Rid of the Penny - The Balance The analysis also shows that tooth decay is still the most common reason for hospital admission with 30,000 children and young people aged 0-19 admitted to hospital last year. The American Council of Science and Health calculates that just transporting pennies to banks not even counting any of the other stages of their production put about 107 million pounds of carbon dioxide (CO2) into the atmosphere between 1982 and 2016. Freshly minted pennies at the US Mint in Denver Should we keep the penny. The Daily Iowan. 2022-11-18 ], ProCon.org, "Should the Penny Stay in Circulation? The cost of producing them is higher than face value. In 1990, he testified before the Senate Banking Committee that his careful statistical analysis of prices showed that rounding cash sales up or down to the nearest nickel would cost consumers around $600 million per year (around $1.2 billion in 2021 dollars). Even the US Mint admits that the cost of producing a penny in 2007 could be as high as 1.4 cents. It began as a pure copper coin, but when prices rose during World War I, the Mint added nickel to the penny to cut costs. Make sure you have some later too. Those who oppose keeping the penny say it's not likely that we will identify new ways to bring down the cost of manufacturing pennies. The penny, a one cent coin, costs 2.41 cents to make, which is nearly 1.5 times what it's worth (source 1). The United States Mint makes over 20,000,000 pennies per day, or 7,000,000,000 pennies per year. With that in mind, halting production of the penny may be a sensible decision for society as a whole. As both stores and individuals stop keeping pennies on hand, banks wont need to supply as many. The answer, for a variety of reasons, is a resounding "yes.". We should be keeping the penny! There are notable points that both sides make. No. The general rarity of the $2 bill is compounded by the fact that many people hoard them. At no point did it rise above its historical average of 3.2%. 2023 Leaf Group Ltd. / Leaf Group Media, All Rights Reserved. The Penny Debate: to Keep Or not to Keep - GradesFixer Even automatic toll booths wont take them except in Illinois, the home state of President Abraham Lincoln, whose face adorns the coin. If that is the case, then people would be less willing to part with spare change for charitable drives. [4] Several unsuccessful legislative efforts have sought to bring about the pennys extinction. 25, 2019, Jenny Gross, "Will the Penny Survive Coronavirus? Any action you take based on the information found on cgaa.org is strictly at your discretion. Despite all this, surveys consistently show that most Americans dont want pennies discontinued. At the direction of Congress, the Mint has been studying potential new compositions that would make the coin cheaper to produce and save the denomination from the scrap heap. It is unclear whether the rounding would be up or down. Economist Henry Aaron of the Brookings Institution, a nonprofit research group, reminisces in a 2013 anti-penny screed about paying a nickel for an ice cream cone as a boy. But, by the 1850s, the government faced much the same dilemma as today: The price of copper had risen, making cents too costly to produce. Nickels cost even more to make - If we eliminate the penny, we will need more nickels in circulation. Shops' reluctance to accept cash payments, coins included, has disempowered people experiencing homelessness, who often don . Shopkeepers would have to either change the prices on all of the items in their inventories or reprogram registers to round automatically when an item is charged. Some penny supporters believe that we should keep the penny out of respect to our country's history and 16th President, Abraham Lincoln, who was the first person to appear on a U.S . Yes, the penny should stay in circulation as it is a reminder of our country's history and serves to keep the cost of goods low. But one point that these advocates often overlook is the value of honoring Abraham Lincoln, the revered president depicted on the penny's face. But whether or not you believe picking up that penny will bring you luck, one thing it definitely wont bring you is wealth. Anti-penny advocates are fond of pointing out that today, the penny costs taxpayers more to produce than its actually worth. shutterstock.com Around 8% of coppers are thrown in the bin every year. Why we should keep the penny. [17], You cant buy anything for a penny; vending machines and parking meters wont accept them. [27], Rounding transactions to the nearest nickel instead of using pennies wouldnt harm consumers or stores. Keeping the Penny. Nickels cost 7.7 cents to make, (2.7 cents over face value, as opposed to 0.26 cents over face value to make a penny,) so making each nickel costs 1.44 cents more than making each penny. Dominic Townsend is a successful article author based in New York City. We're talking about those insignificant one cent pieces in your pocket or purse. Millions of consumers also oppose the cents elimination on economic grounds. The debate over whether to keep the penny or discontinue it has intensified since the penny crossed the line of one-cent production cost per penny. The total amount doesn't end when coins and citizens are debating the penny and whether or not it should be kept. Some of the arguments for keeping the penny are practical ones. 29, 2017, Andrew Stelzer, "Phasing out Pennies in a Bid for Change," npr.org, Nov. 29, 2009, Shaun O'Brien, "Consumer Preferences and the Use of Cash: Evidence from the Diary of Consumer Payments Choice Working Paper," frbsf.org, June 2014, Raymond E. Lombra, "Eliminating the Penny from the U.S. Coinage System: An Economic Analysis," Eastern Economic Journal, Fall 2001, Vancouver School of Economics, "Penny Rounding Profitable for Canadian Grocers: UBC VSE Student Research," economics.ubc.ca, Nov. 16, 2017, Reuters, "Pennies: The Throwaway Coins We Can't Let Go Of," latimes.com, May 31, 1994, Amy Livingston, "Should We Get Rid of the Penny? For example, the zinc metals lobby, and the Coinstar company (who make those change-counting machines in the grocery store) will both fight hard to keep the penny in production. Maybe this is another consideration that the U.S. government should look at. To save time at the register, some businesses have experimented with rounding all transactions to the nearest nickel. First of all, if the U.S. Mint stops producing pennies, they wont simply lose their value overnight. She is a member of the American Numismatic Association (ANA) and holds several certifications. Not only do they cost money to make, but they don't buy much anymore - you can't even buy gum with them! Several Chipotle restaurants tried this in 2012, but customers who had extra cents added to their bills complained. Keep or Get Rid of the Penny? 8 Reasons to Do Either Chicago, Illinois 60654 USA, Natalie Leppard The current cost for manufacturing a nickel is 7.29 cents per coin. Report this Content. Overall, continuing the use and manufacturing of pennies . [1] Aaron Klein, former Deputy Assistant Secretary for Economic Policy at the Treasury Department, estimates that the United States could see $1.78 billion in losses over the next 30 years if the penny remains in production. 3. Many foreign nations have eliminated their most minor denominations with almost no impact on commerce or consumer confidence in the monetary system. Learn how to pay for IVF with these strategies for fertility financing. They're Bad for the Environment. [3], For more on US currency, explore Currency and the US Presidents.. Its possible that what happens to the penny could end up depending not on the law, but on decisions made by businesses. The group's mission is to keep the penny in use. In 2009, four different cents were issued with images representing key segments of Lincolns life. This article was published on July 2, 2018, at Britannicas ProCon.org, a nonpartisan issue-information source. In Canada, at least, eliminating the penny has not led to a widespread increase in prices. If only cash transactions are affected, then electronic transactions will continue to deliver more sensitive data. Anti-penny advocates point to the 2020 annual report from the U.S. Mint, which states that it costs 1.7 cents to produce a single penny. Nickels also cost more to make than their face value about $0.07 apiece so the Mint loses even more money on each nickel it produces than it does on each penny. As the U.S. Mint faces the prospect of having to find more cost-effective compositions from which to make the nation's coinage, the debate about the continued existence of the humble penny is sure to carry on. The penny has been around for centuries, but it may be time to say farewell. First, consumers benefit with a low denomination coin. If so, how? They dropped the penny and rounding happens just the way you learned in like 2nd grade. Many people thought that 2009, the 100th anniversary of the Lincoln cent, should have been the last year of penny manufacture. The $2 bill, however, might be making a comeback. By clicking Accept All Cookies, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. A pro-penny group backed by economist Raymond Lombra testified before the Senate Banking Committee in 2006 that his careful statistical analysis of store prices showed that rounding cash sales to the nearest nickel would cost consumers billions in extra costs. But the price of copper receded, and plans for the change were dropped. "FAQs: How Issuers Work with DTC." Feb 7, 2014, 08:12 AM EST | Updated Dec 6, 2017. All information published on this website is provided in good faith and for general use only. There are many anti-penny advocates that scoff at its existence, arguing that it costs more to mint pennies than the coins are worth. That doesnt sound like much, but a 2019 Federal Reserve study shows that the average consumer still makes 11 cash transactions each month and according to the Bureau of Labor Statistics, there are over 343 million consumers in the country. Preserving the penny keeps consumer prices down and avoids harming low-income households. In 2020, the penny debate gained new attention as the coronavirus pandemic led to a nationwide coin shortage. After all, we still need the coin for a number of reasons. The problem is, too many believe the present administration and government in D.C. is reasonable, when its actually FUBAR. How Many Coins Are in a Regular Roll of Coins? As useless as pennies are, most of us cant avoid them. [10][11] So what if it costs 1.8 cents to make? The use of cryptocurrency for small payments such as the penny could revolutionize how people manage their finances, allowing them to make quick, secure purchases without worrying about currency conversion rates or transaction fees. Many anti-penny advocates think the ideal solution to this problem is to eliminate the nickel as well, making the dime the smallest coin in circulation. You can also make some hand-stamped bling like this . The bills, according to the Federal Reserve, cost only $0.155 to print, far less than their $5 face value. Through careful analysis of 200,000 convenience store transactions, Whaples concluded that sales taxes and other fees charged to consumers were slightly ahead of prices rounded to the nearest nickel which meant it couldn't possibly affect consumer spending or trigger widespread inflation - two claims made by Lombra. In fact, it costs almost a dime to make a nickel today. Payments made with credit, debit, or old-fashioned checks are still settled down to the cent. Using your figures, that would amount to about 1000 ounces of copper. Whaples, by contrast, analyzed actual data from more than 200,000 convenience-store transactions in seven states. "Should the Penny Stay in Circulation? Consequently, all government payments tied to the CPI, such as Social Security, would rise, costing the government $1.5 billion ($3 billion in todays dollars) over five years.

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