Should the mint stop making the penny?

Question

Well for 1 reason it costs 2 cents to make the 1 cent coin in other words, rip off. Also since 1 cent is nearly worthless people see it as just as just annoying. Most people will ignore if they see 1 on the ground. Others just throw them in the trash. Like goods and servises really need to be rounded off to pennies.

However Tax money would be an issue, I think the average for the states is like 6 or 7 cents on the dollar. They would have to create a system around that.

also what are your opinions on the new dollar coins

http://www.usmint.gov/mint_programs/$1coin/index.cfm

I think they are cool and better then $1 bills, saves the government money as well. I think they should get replace $1 with the coin and bring back the $2 bill which is actually still being printed just not used

that's what I'm saying brown eye girl they'd have to change the face value of money a little to make it work

Answer 1

Economic reasons point to the conclusion that pennies should be discontinued. As you pointed out there is negative seignorage with pennies and the cost is going to increase at the rate of inflation. In addition there are the distribution and transaction costs of using pennies. As a result of their low value the opportunity of the extra few seconds it takes to use pennies is higher than the value of the coins.

Plenty of other countries have discontinued their lowest denomination coins. Australia and New Zealand are good examples of this. All non-cash transactions are still priced to the penny but cash transactions would be rounded up or down. Taxes would not be an issues as generally they are settled in cash and even if they were the maximum that you would lose out on is 2cents if the last digit in 8 or 3. On the other hand you could gain 2cents if the last digit is 2 or 7 so it balances out. Studies have shown that any costs associated with rounding is negligible. This is one such study http://economics.ca/cgi/jab?journal=cpp&view=v29n4/CPPv29n4p511.pdf relating to the possible abolition of the Canadian 1 cent coin. Studies related to the US economy have come up wit similar conclusions. One by Wake Forest University concluded that the net effect is 1/40th cent gain towards the customer.

I think the obstacles of the removal of the penny include a sentimental attachment to the penny by some, possibly influenced by having Lincoln on its face (particularly in Illinois), an unwillingness for the government to acknowledge that it is practically worthless in most cases and a reluctance to discontinue a major use of zinc produced in Tennessee mines (no one seems to have lobbied harder against anti-penny legislation than Jarden Zinc products).

Answer 2

Believe it or not, there used to be 1 cent and 2 cent candy bars. They still make them, but they put them into a bag of about 12 - 16 ounces. Movies used to be 9 cents for children...
That's the thing. Everything costs so much more now. Inflation, the REAL inflation, is much higher that that stated by our Government. There really is no need for the 1 cent coin. Hey, you can't buy anything with a nickel, either.
So, yes, they should do away with the 1 cent coin.
As to one dollar coins, I like them, but only to put into my collection. If they were the size of the old cartwheels (silver dollars) they would be nice, but for we older persons who have difficulty seeing, they can easily be confused with a quarter. Also, see how much 50 or 60 of them weigh in your pocket/purse! When dropped, they quickly roll some place where we can't reach them.
So, 1 cent coins, no. One dollar coin, as minted, no, except for souvenirs.
As to $2 bills, I liked them and used to send them to my wife before we were married. However, most people, including my departed Dad, believe that they are "bad luck", so you would have an uphill battle in trying to bring them back.

Answer 3

I actually think if we got rid of the penny things would cost more. I mean you'd have to change how much gas is because its always whatever amount and 9/10. If its like 9.97 do you go down to .95 or up to 10.00?

My mom just took in over 100$ worth of pennies to the bank that we saved up!!..... and i always pick up a penny if i see it...if its heads up. :)

and i like the new dollar coins. I'm saving them. I need to get "TJ"...the one branch of my bank didn't have any...i'll check out the other one on monday.

Answer 4

actually, the zinc it particularly is used to make the penny is 50% extra high priced than what the penny is well worth. rather of dropping 4 cents, you will benefit 5 cents. it will around to the closest nickle. I asked this question until eventually now this week.

Answer 5

I can't remember the last time I heard the word 'seignorage' in a conversation.

But it is true. If it were easy to startup your own mine, and separate the zince and copper, at some point some firm is going to make a nice profit -- although I suppose it is illegal.

In any event, the penny will eventually go away. The sooner the better, in my opinion.

Answer 6

No. The mint should start making steel pennies as they had to do during World War II.

Answer 7

yeah i think so, they are pretty much worthless, everything should end in a 5 or 0.....maybe someday we will upgrade...to nickels being the lowest coin.

Answer 8

A penny saved is a penny earned.....

Answer 9

one penny's r fun If u dont want them I ll take them