Thursday, April 11, 2013

Retire the penny, please -- April 11, 2013 column


Washington is obsessed with trillions, but it’s the lowly penny that’s weighing us down.

President Barack Obama on Wednesday sent Congress a budget plan to spend almost $3.8 trillion in the fiscal year that starts Oct. 1. Can anyone fathom one trillion, let alone nearly four? How about a measly billion?

Pennies we get. Not from heaven, but hand to hand. They are heavy in our pockets and wallets. Pennies clutter our dresser tops. Pennies fill old coffee cans and nest between sofa cushions. Pennies are a burden – small and needless.

It costs twice as much to produce a penny as it’s worth. In fiscal year 2012, pennies cost taxpayers $58 million. That’s hardly big bucks as far as federal spending goes, but why are we doing this?

Nearly everyone agrees the penny has outlived its usefulness. A penny buys nothing, not even penny candy. Many times I’ve heard the dramatic sighs of those behind me when I’ve dug deep to find the right change. Pennies aren’t even good for checking tire tread anymore. Better to use a quarter for today’s tires, retailers say.

The president says the penny is an apt symbol of what ails Washington. He was asked in a Google+ hangout “fireside chat” in February why we don’t stop minting pennies – as Australia, Canada and New Zealand have done.

“Any time we’re spending more money on something that people don’t actually use – that’s an example of something we should probably change,” he replied.

“One of the things you see chronically in government: It’s very hard to get rid of things that don’t work, so we can invest in the things that do. So the penny becomes a good metaphor for a lot of the problems that we’ve got,” he added.

I love a metaphor as much as the next English major, but why prolong our penny foolishness? Obama could have used his budget to declare our independence from the tyranny of pennies.

Instead, on page 144, the budget calls for the U.S. Mint to “change the composition of coins to more cost-effective materials, given that the current cost of making the penny is 2 cents and the cost of making the nickel is 11 cents.”

That’s right. To, um, coin a phrase, the 5-cent piece is nickeling us. We spent $51.2 million on nickels last year.

As for changing the content of coins, we’ve already adulterated the penny from all copper to 2.5 percent copper. It’s 97.5 percent zinc.

Obama recognizes that people are emotionally attached to pennies. They remember their childhood piggybanks and cashing in pennies for a dollar or two, he said.

Nostalgia didn’t stop the Royal Canadian Mint from ceasing production and distribution of pennies in February. Customers can still use the Canadian penny. The government’s Rounding Guidelines suggest that businesses round cash transactions to the nearest nickel. Credit, debit and check purchases are still in penny increments.

In 1857, the United States did kill a penny – a half penny, to be precise. It was the first coin the nation ever authorized and production started in 1793. People surely were sentimentally attached to it. It was worth what a dime is now, far more than the lowly penny is today.

For decades, smart people have said it’s time to retire the penny. My late friend and colleague Charley McDowell, beloved Richmond Times-Dispatch columnist, wrote in 1990:

“I, for one, am willing to do away with pennies even if merchants ease the prices only up, not down, to the nearest nickel. The percentage of general price increase…will not be great. Anyway, relief from pennies would be worth it.”

I wondered what Charley would have said about the couple in Chicago who tiled their bedroom in pennies recently, saying it was cheaper than using regular tile. As for me, I lugged 47 wrapped rolls of pennies to the bank.

The young teller was gracious, but his friend at the next window wore the smirk of a boy who can’t believe his luck when the teacher skips him and asks the next kid to solve the equation.

My teller counted and recounted the rolls. Pennies steal time and energy, even wrapped. He asked how I wanted my loot. I did not say I wanted nickels.

©2013 Marsha Mercer. All rights reserved.

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