Everyone has it. That jar back home filled with hundreds of pennies that will never see the light of day. At least, until you decide one day that enough is enough and proceed to dump the coins haphazardly into a Coinstar. Pennies are for tossing in the center console of a car. They’re for getting stuck between couch cushions and for seniors paying exact change in line at CVS. The rise of credit cards, Venmo and Apple Pay has highlighted an urgent new reality: it is time to discontinue the penny.
In 2006, the value of the zinc and copper in a U.S. penny exceeded the coin’s own one cent face value. The gap has only grown worse since then and as of 2013, the U.S. mint now spends 1.8 cents for every penny minted. Despite the uneconomical production of the penny, the truth of the matter is that the penny just isn’t worth what it used to be, and the culprit is inflation. When was the last time anyone lugged 700 pennies to Chipotle? As a result of inflation, the penny’s value is drastically different than its value at its inception in 1793. To reduce the time cashiers spend doling out pennies, Chipotle has decided to round to the nearest nickel, joining the ranks of institutions like the U.S. Army, which hasn’t used the penny overseas since 1980. Chipotle, vending machines and parking meters are all screaming the same message: pennies are useless.
There genuinely used to be a time when people would take the time to stop and pick up a penny off the ground. And that time was 1793. In a New York Times Op-Ed, David Owen calculated that picking up a penny today “pays less than the Federal minimum wage, if you take more than 4.9 seconds to do it.” In the amount of time it would take someone to pick up a penny, she could have spent the time with family or friends, which at this point is a far better use of those five seconds.
In this supposed penny “debate,” history is on the side of elimination. In fact, it reveals this change is long overdue. Remember the half-penny? Of course you don’t, because the U.S. government discontinued it in 1857 after it became irrational to use. At the time of removal, the half-penny had an equivalent 2014 value of 14 cents, worth more than even our third lowest currency. The penny’s demise is not only overdue, but it’s costing us more every day. According to Robert Whaples, a professor of economics at Wake Forest, we lose over $900 million a year on the production of pennies. That’s not chump change.
So what’s been preventing the necessary demise of the penny? Since the U.S. penny is actually 97.5 percent zinc and only 2.5 percent copper, there is understandable resistance from the zinc industry. Jarden Zinc Products, the supplier of zinc to the U.S. mint, and many other companies spent over a million dollars since 2006 to fund a lobbyist group called Americans for Common Cents. While I will give them bonus points for a clever name, ACC has effectively used its massive war chest to kill every anti-penny bill in Congress behind the façade of misleading justifications and self-conducted polling. First, ACC cites a 2014 poll administered by the group itself which states that 68 percent of adults support keeping the penny. Despite the fact that a YouGov/Huffington Post poll found that number to be 51 percent, it actually is a little concerning that so many Americans either don’t care or are genuinely against the penny’s logical elimination. This opposition is in part a testament to the ACC’s ability to pervade the notion of impending economic doom should the United States terminate the penny. Secondly, ACC alleges consumers could be hit with a “rounding tax.” In practice, there hasn’t been any conclusive evidence that eliminating the penny places an added tax on consumers or causes increased inflation. Whereas the United States has quivered before the almighty power of corporations and special interests, recently, New Zealand and Canada have followed the widespread support of businesses and economists by eliminating their lowest currencies. Their proactivity to remove a forsaken inefficiency provides our country with a proven strategy to save time and money.
It’s time for the United States to follow in the footsteps of the U.S. Military, Chipotle and dare I say it, Canada. To the penny, I say goodbye and good riddance. Our time is just too valuable. It’s worth every nickel.
Ben Yahnian is a Viewpoint writer.
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