Is the Cent Wothless?

Hold on to them until you get one more penny -- then use them in place of a nickel.

(Or am I misunderstanding your question).

It's not like we'd be banning cents, we'd just stop making them. But they'd still be legal tender.

 

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I would suspect that if we stopped making 1¢ coins and rounding to the nearest nickel was allowed, you could still pay to the exact penny if you had some 1¢ coins.

This was proposed by Representative Kolbe a number of years ago as the "Legal Tender Modernization Act". The coins would forever remain legal tender but simply would no longer be made, and would allow rounding to the nearest nickel.

There's an organization that favors the elimination of the 1¢ coin:

<http://www.retirethepenny.org/>

Paul

 

That would be true if it were only exchanged once, and removed from circulation. As is, they are exchanged for decades (how many 1960's pennies do you still get in change) so their cost vs metallic value is offset.

Why do you think the mint produces so many proof sets, special runs, and encourage collecting ?

If it costs $.06 to make a quarter, and people remove them from circulation as soon as they get them, they have a 400% profit.

 

From the point of view of the Mint -- it is only exchanged once.

Bottom line is this: over the last three years: they made & distributed over 15 billion pennies at a cost of 1.5 cents each, and exchange them for the 1.0 cents each, losing $82 million. (Overall, they made lots of money -- mostly on quarters and dollars -- but they lost $82 million on cents, and $85 million on nickels)

 

Yeah, I personally struggle with that when I go to another state. We don't have sales tax here in Oregon (be are blessed with the nation's highest state income tax :rolling so when I go into a store and buy sometime for $3.00...I pay $3.00 not $3.21 or something. I agree that the tax should be included in the sticker price of an item.

 

Yes and No. It depends on the cost of the metal when the coin is produced. They can go back and forth between steel and zinc even in the same year.

 

Check this out http://www.pennies.org/

 

Their arguments aren't really that valid. I rounding argument goes both ways...it would work out equally. It wouldn't cost the consumer anymore money than they are already paying because "sometimes you win and sometimes you lose with rounding" but it all comes out in the wash. The only way we lose is if we keep the cent because of the ridiculous cost of producing it. It is nothing more than a waste of money. What we are doing with our tax dollars is akin to me trading you $0.65 for $1.00, it just doesn't make sense.

Another way to look at it is the half cent. In the past we had a half cent denomination and it was dropped because it was no longer that useful and was a drain on resources. We had to learn to round to the nearest one cent...but we made that change just fine. We would do the same to the nearest 5 cents.

 

The problem isn't with the cent, the problem is that 95% of americans are extremely overpaid. Higher salaries drive prices of everyday needs threw the roof. Think about it...

 

Stop making the Cent. That hurts me saying that as a collector but it's what we should/need to do.

And Camaro - I don't like having the price of the tax included in the price. Then it's like a hidden tax. We forget how much we are being tax'd and they will keep raising them then.
Put the tax amount out there and see how much we are paying every time. Look at our employer matching Social Security tax. Most people don't even know it's there but it is and it's huge. That is money that comes from your pocket basically.

 

I think that's a fair argument. What I propose is this then. Let's say for arguments sake an item is $2.00 and the tax is 6%. I'd have the price tag say something like this:

Item: $2.00, Price with tax included $2.12

This way, we know how much we are being taxed but at the same time the total price is clear on the label.

Of course, in the world without the cent...this would then be rounded down to $2.10.

 

that's not a bad idea! :thumb:

 

That's kind of how they do it in places where the VAT or sales tax is included. Your total is what was marked on the labels, but your receipt will show how much the items are without tax and have a separate line in the total for the amount of the tax. This allows people not subject to the tax (foreign visitors) to receive refunds.

Currently, the cent's only purpose is to pay exact sales tax. Producing them is a colossal waste of effort and money.

 

Good case.

And when the half cent was discontinued it had a purchasing power close to that of two quarters today. So today we are whining about how much we would be hurt by eliminating a coin worth 1/50 of what the half cent was worth when IT was eliminated because it was just too small an amount of money to fool with.

 

Excellent point, Conder. Vending machiones have been rounding to the nearest nickel for a LONG time. For the rest of the retail market to follow suit would be less dramatic than most realize. Then they can move all the coins over one space in the cash registers, and have room for the dollar coins!

 

I make $.01 every 5 seconds. So, find two pennies next to eachother and I triple my wage. Find a dime and its up tenfold. Find a quarter and I don't have to work for a full 1 min. 15 seconds. 3600 seconds/75 seconds per quarter is 48 quarters. So, if i find 1200 pennies in my lifetime I will have the last hour of my life-time free. Unless my wages change (hopefully it will go up). Then I'll have to do the math again. :goofer: If the maths off its not too off.

 

The cent can only aspire to be worthless.

Not only are we a little poorer everytime one is made but we are poorer everytime one is usede because of the handling, counting, and transportation cost.

There are also 200,000,000,000 of these sitting idle in change jars where children can be exposed to the toxicity but this is two billion dollars sitting idle as an encumbrance on the owners rather than providing capital for building or starting new business. We waste millions of man hours with these every year that could go to something benbeficial rather than wasteful.

You can actually work a rat to death by giving it smaller and smaller food rewards for more and more work. For most people stooping to pick up a penny costs more than it's worth.

This goes for everyone who stops in the roadway where so many pennies are littered.

 

This is absurd.

If you subtract the metal costs from these it looks like;

cent: 1c
nickel: 1c
dime: 3c
quarter: 6c
dollar: 20c

It's simply ludicrous to believe they can fabricate a nickel for a penny but it costs twenty times as much to make a similarly sized dollar. Why would a little dime cost three times as much to make as a penny?

Obviously they are shifting the huge waste of making pennies and nickels onto the other coinage.

The biggest waste of the penny is when it actually gets used. When you see a well worn cent (VF) all that wear represents a few dollars in waste. With 200,000,000,000 pennies lying around representing so much waste it's mind boggling. Then add to this waste the additional waste of not havcing a circulating dollar coin since this coin can't circulate with the penny because of the lack of space in change drawers.

I once called our coinage system static and obsolete. It certainly hasn't been static since 1999 but it has gone well beyond obsolete to dysfuntional.

One might even say it has jumped the shark and gone beyond the pale.

 

One other consideration that gets overlooked is that the mint is so tied up making vast quantities of less than worthless cents that they have to run all the presses flat out. This means there isn't time during each strike for metal to flow into deep recesses of the die. To counteract this they simply keep lowering the relief which means we have unattractive low relief coins. This is literally the face we show the world yet we have somew of the least attractive, poorly made coins in the world.

The die shop runs full out making penny dies by the buggy full while other dies are used long beyond their useful life.

We pay an enormous price for these coins.

 

So people are so stupid they cant figure the tax on the total. I live in Pa. 6% state sales tax 6cents on a dollar 60cents on 10dollars 6bucks on 100 60 on 1000. I honestly dont get people claiming they cant figure out tax, how do you tip? Do these people just hand a crumpled wad over and hope the other guy isnt as clueless or dishonest? Who holds yer hand when ya cross the street? Oh but gee give the incompetent a drivers license, cant make change but sure can pilot 2000lbs of steel at 65mph. Look Ma no hands yes Ma I'm on the cell phone too, uh nothing just eating a big mac and thinking about the damn penny be home in 5 mins. hows that for a rant