Pennies litter the streets and lie uselessly in people’s couches, cars, pockets and drawers. The penny is obsolete and impractical in America’s modern economy; the government should stop minting them and get rid of these copper-coated nuisances.
According to TIME Magazine’s website, the United States penny cost 2.4 cents to make, 140 percent its face value. Since the United States mint sells these pennies to the Federal Reserve at their face value, taxpayers lose 1.4 cents per penny made. With over seven billion pennies stamped out annually, the treasury draws in an enormous penny deficit every year, a problem referred to as “negative seigniorage” in the coin world, not to mention the intense labor, time, and expenses put into transporting and distributing these pennies across the nation. This deficit could be easily erased if the government stopped minting pennies. Finally, eliminating the penny could even help to alleviate the budget crisis burdening this nation (time.com).
This growing problem also applies to countries all over the world. According to the New Yorker, the Canadian government announced that they would stop minting their pennies by April of this year to save the $11 million dollars that they lose every year to make and distribute pennies. Australia stopped minting their pennies in 1992 and Israel stopped making their five-agorot coin, the equivalent of a penny, in 2008 (newyorker.com). The US should join the ranks of these other nations and this wave of currency reform by putting an end to the penny.
Due to inflation, pennies aren’t as useful anymore. “I always see them lying around. People just throw them to the side,” said Junior Sandra Law. According to TIME Magazine’s website, in the 1920s, eight pennies could buy a whole loaf of bread. Eight pennies nowadays might be equivalent to a quarter of a small slice of bread. Additionally, few machines accept pennies. They are worthless to vending machines, pay phones, most tollbooths and even some restaurants and shops (time.com).
The fact that many people pay to get rid of their pennies is amusing and almost unbelievable. Available at banks, convenient stores and some retail stores, Coinstar charges 8.9 percent of the coins that customers give to the machine, according to the Coinstar website (coinstar.com). The notion that people will pay this substantial fee illustrates the need for this nation to get rid of pennies. “I just throw them in tip jars. I honestly think we can get rid of pennies and it wouldn’t affect anything negatively,” said Senior Brian Mills. “Pennies are so annoying,” added Sophomore Eric Chao. “I think they’re a waste of time. We should rely on more non-cash transactions.”
According to the Tree Hugger website, a Discovery Communication subsidiary, pennies are three percent copper and 97 percent zinc, and are primarily made from virgin ore. Making pennies from zinc and copper means mining for those materials. Red Dog Mine, which is the largest zinc mine in the United States, is by far the number one polluter on the Environmental Protection Agency’s (EPA) list, because of its large quantities of heavy metals and lead-rich mining tailings. The process of refining both metals can release sulfur dioxide, lead, and zinc into the environment (treehugger.com). Pennies are not only wasteful and expensive, but also detrimental to the environment.
Some complain that getting rid of the penny would impose a rounding system that shop owners would take advantage of. However this rounding system only applies to the last nickel in a transaction. A purchase of $2.98 would be rounded up two cents, as would a purchase of $602.98. According to the New Yorker, sales tax is already rounded when dealing with fractional cents. Besides, the increasing percentage of transactions handled by credit card, Paypal, and other non-cash mediums wouldn’t have to follow this potentially abused system (newyorker.com).
The penny is past its time and, as Canadian Finance Minister Jim Flaherty said, “The penny is a currency with no currency” (time.com). Let’s retire the penny and get rid of it for good