Penny Reign: America's Least Valuable Coin Endures
Cavanaugh, Tim, Reason
SOMEDAY, probably within your lifetime, the one-cent coin will go away. The penny, the first coin minted in the United States, was obviated by inflation before most members of today's work force were born. Its production cost is more than half again as much as its face value. Its detractors include respected economists, forward-looking realists, and coastal cosmopolitans; its supporters consist largely of sentimentalists, hoarders, the zinc lobby, and the dwindling number of women named Penelope.
Ending the penny would put the United States about mid-pack in an international trend. Penny abolitionists point to New Zealand's success in getting rid of its own one-cent piece nearly 20 years ago. To our north, Finance Minister Jim Flaherty said in May that the Canadian penny--which has lost 98 percent of its purchasing power since the early 20th century--"eventually ... will be eliminated." In Mexico the one-centavo piece has not been circulated since a 100,000-per-cent revaluation of the peso in 1992. While the E.U. introduced a one-cent euro coin during conversion to the common currency, the coin has since fallen into disfavor. Finland and the Netherlands have retired the essentially nameless 0.01 [euro] coin, replacing it with the "Swedish" system of rounding.
Penny haters insist they are motivated by unalloyed Taylorist logic. Their arguments for ending the copper-colored miscegenation of silvery coinage can be pretty compelling: The amount of time we spend futzing with small change amounts to a multimillion-dollar opportunity cost each year. To earn the federal minimum wage as a penny collector, you'd have to stoop and pick up one coin every five seconds. As you read this article, some yuppie, gold card in hand, is being made to wait in a Trader Joe's checkout line as an old lady sorts out her change--and if the cowardly morality of society will not allow us to kill the elderly for efficiency's sake, we can at least take away their coins.
Campaigners against the penny deploy the language of reason exasperated by mulish cant. Freakonomics co-author Stephen J. Dubner uses his New Fork Times blog to sniff at the "nostalgia" "inertia," and "ridiculous pro-penny defenses" of Abe Lincoln fans stricken with "pennycitis," opining that pennies are best used as floor tiling at hipster bars in Manhattan's meatpacking district. In a YouTube rant, anti-pennyist John Green denounces pennies as "bacteria-ridden disks of suck that fail to facilitate commerce." In a lengthy 2008 New Yorker piece about a visit to the U.S. Mint, David Owen declares, "A modern penny simply isn't worth enough to worry about." Owen and others fret about the problem of "negative seigniorage"--i.e., the Treasury loses money by supplying banks with pennies and nickels. (That's the reverse of the situation with bills and larger-denomination coins, whose high face value and low production costs create a profit for the government.)
While penny abolitionists depict themselves as an embattled fellowship, the organized pro-penny movement is fairly thin. Jarden Zinc Products sponsors the lobbying group Americans for Common Cents, though it's unclear how important lobbying is in the coin's survival. …