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Should the U.S take the penny out of circulation?

a year ago
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42

The question of whether the U.S should take the penny out of circulation is a complex one, with valid arguments on both sides. While some argue that the penny is no longer useful and costs more to produce than it is worth, others believe it serves important purposes and should be retained. To provide a detailed answer, let's examine the arguments and evidence supporting both perspectives.


1. Arguments in favor of eliminating the penny:


a) Cost of production: It is well-documented that the cost of producing a penny exceeds its actual value. According to the U.S. Mint, it costs approximately 1.99 cents to produce each penny. This means that the government is effectively losing money with every penny minted. This cost is primarily due to the rising prices of zinc and copper, the main components of the coin.


b) Inconvenience and inefficiency: The penny has lost much of its purchasing power over time. In practical terms, it has become almost useless for everyday transactions. Many people choose to ignore pennies, leading to rounding off prices to the nearest nickel. This rounding off system is already in place in several other countries like Canada, Australia, and New Zealand, where the penny has been eliminated without significant negative consequences.


c) Time wasted in transactions: Handling pennies during transactions can cause delays, especially in cash transactions. Counting, exchanging, and storing pennies take up valuable time for both consumers and businesses. Eliminating the penny could potentially lead to faster and more efficient transactions.


2. Arguments in favor of keeping the penny:


a) Psychological pricing: The penny still plays a role in psychological pricing strategies. Retailers often price their products at $X.99 to make them appear cheaper. Removing the penny might lead to a shift in pricing strategies, potentially increasing prices and affecting consumer behavior.


b) Charitable donations: Many charities rely on penny drives and collection jars to raise funds. While individually pennies may not hold much value, collectively they can make a significant impact. Eliminating the penny could potentially reduce the amount of money donated to charities.


c) Historical and sentimental value: The penny has been an integral part of American history and culture. It has featured iconic figures like Abraham Lincoln and has become a symbol of American identity. Removing the penny may be seen as erasing a part of the nation's heritage.


In conclusion, the decision to eliminate the penny from circulation in the U.S. is a complex one. While the cost of production, inconvenience, and inefficiency argue for its removal, the psychological pricing, charitable donations, and historical value suggest retaining it. Ultimately, this decision should consider a balance between economic practicality and societal implications.

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Izaiah Macias

a year ago

seems to me like an easy way for banks/big businesses to make more money. sure, to an everyday person round up to 5 cents is nothing. but to a business with hundreds of thousands of transactions daily, those rounded pennies would add up quick. Im definitely not an economist so if im wrong please spare me

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Sincere Marsh

a year ago

I think production of the penny should stop but it should not be devalued. We would learn quickly to round the price if we didn't have exact change.

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Colby Hogan

a year ago

No. Without pennies how will passive aggressive bill payments work? Nickels are 5% less passive aggressive.

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Briggs Yates

a year ago

The worthless things that collect in your wallet

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Ashton Flynn

a year ago

We should get rid of the 5 cent coin as well

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Axton Sparks

a year ago

Australian here we got rid of the 1 and 2 cent coin and literally nothing has changed except everyone is happier.

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Yes, definitely. In a country where you apply tax at the time of paying rather than on the price tag, you must get rid of the penny. It's impossible to have correct change before your sale is rung up so it slows everyone down. Not to mention it costs more than a penny to make it.

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Alden Norton

a year ago

There would be a sudden abundance of zinc

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Tripp Velasquez

a year ago

On US Military bases on Okinawa, there are no pennies, and it's absolutely fine. I was told by a cashier that they don't have them because they cost more to ship there than they are worth. After a few weeks there, I wondered why the US still bothers with them at all.

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Casen Lindsey

a year ago

Why not just round up/down on the original price instead of having this discrepancy between cash and digital?

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