THE PENNY HAS ITS OWN LOBBYIST!!
Since it costs the U.S. Mint approximately 1.5 cents to produce one penny why continue to mint the penny when it cost $134 million last year to produce $80 million worth of the coin? The situation bothers Edmund Moy, the Director of the U.S. Mint who would like Congress to find a solution. “You can’t sustain losses on pennies and nickels and expect to be a viable organization that benefits the American people,” says Moy.
Moy says that substituting a cheaper metal, possibly steel, could save up to $100 million annually. The Constitution gives Congress the power to regulate currency, and legislative efforts to change our change haven’t gained support.
One would wonder why legislative efforts to change the penny haven’t succeeded until one discovers that the penny has its own lobbying organization!! “Americans for Common Cents” (www.pennies.org) is a lobbying group for the penny and is funded by the zinc industry. Since the penny is comprised of 97.5% zinc it all makes sense. I have included propaganda information from Common Cents’ web site at the end of my blog.
“Citizens to Retire The Penny”, (
www.retirethepenny.org) “is a non-partisan organization dedicated to educating the public on the advantages of retiring the penny from general circulation.” They accept no corporate sponsorship of any kind, and are supported entirely by private individuals. Since they don’t have as many pennies in funding as “Americans for Common cents”, they cannot win this battle.
I will let you put your own two cents in after you read the arguments of the pros and cons below.
FROM THE PRO PENNY WEB SITE:
The Penny's Impact: From the Grocery Store to the Gas Pump
The penny enjoys overwhelming support from the majority of Americans. Eliminating the penny is a losing proposition because it will result in rounding to the nearest nickel and higher prices for America’s working families. This increased cost to consumers will be felt in everything from the grocery store to the gas pump. Pennies add up to millions of dollars every year for charities across the country. Simply put, the penny plays an important role in our everyday lives and in our nation’s economy.
Our Mission:
Americans for Common Cents aims to inform and educate policymakers, consumers, and the media about the penny’s economic, cultural, and historical significance. Through coalition building, media outreach, and community partnerships, ACC attempts to ensure that accurate information about the penny is widely disseminated, and that the impact of any changes to the penny’s role in our nation’s monetary supply is adequately understood.
The importance of preserving the penny goes well beyond high public acceptance and historical significance. More recently, a
February 2006 Coinstar National Currency Poll found that two-thirds of Americans want to keep the penny as legal tender. According to Coinstar, 66% of Americans still want to keep the penny as legal tender, virtually the same percentage (65%) as in 2001. Other findings included:
· 84% of females and 74% of males would still pick up a penny off the ground
· 73% of females and 58% of males want to keep the penny
· 33% of males and 22% females do not value loose change or keep track of it
· While more Americans own Piggy banks than in 2002 (67% versus 56%), less are now using them for penny accumulation (57% versus 87%)
· Only 27% of Americans want to eliminate the penny, virtually the same level as in 2001 (26%)
· To date, Abraham Lincoln is the most favorite president featured on U.S. Currency, just beating George Washington 28% to 25% (from 2004 Coinstar National Currency Poll)
FROM THE ANTI PENNY WEB SITE:
Myth #1: Elimination of the penny would lead to higher prices.
This claim is based upon a flawed study that found a majority of prices would be rounded up rather than rounded down. This would be true if stores did not change pricing strategies (99 cents to 95 cents, for example), there were no sales tax (which randomizes the direction of rounding), and people did not purchase more than one item (which also randomizes the direction of rounding). If these factors are included then, on average, there will be no net change in prices. Indeed, a
recent study by Robert Whaples, chairman of the economics department at Wake Forest University, has confirmed that rounding is neutral.
Myth #2: Elimination of the penny will hurt charitable causes.
This is not obvious, because the charities currently asking for pennies will instead ask for nickels. Will the charities receive more or less than one fifth the number of pennies they currently receive?
Myth #3: The penny produces a profit for the Treasury.
Luckily, this argument is no longer made, as all sides agree that it now costs more than a penny to make a penny.
Even if this were not the case, it is a silly argument. The treasury could always obtain an infinite "profit" by printing a trillion one hundred dollar bills. They do not do this because printing bills and minting coins increases the supply of money and causes inflation, thus decreasing the value of all the rest of the money in circulation. This "profit" is therefore really just a hidden tax.