My Two Cents

“If it’s a penny for your thoughts and you put in you two cents worth, then someone, somewhere is making a penny.” Steven Wright

   I read in the news, once more, suggestions by the powers that be of ditching the US cent. A US penny costs 2.4 cents to produce and distribute.  And there were 4.3 billion minted just last year.  That’s a lot of coin, and doubly so as a losing proposition...actually about doubly-and-a-half, but also, according to the US General Accounting Office two-thirds of all pennies are out of circulation, with many disappearing almost the moment they reach the public.  Certainly there can’t be that many coin collectors?

   “People gripe and moan about the penny, but they still want to keep it” says Richard Doty, senior curator of the Numismatic Collection at the National Museum of American History in Washington, DC. His poll suggests the public is split, about 60/40 in favor of retaining the penny.

  King Offa is the fellow credited for introducing the first penny to the English speaking world, back in 789 AD.  It was also the only coin in existence in England for about 500 years.  It’s the oldest unbroken coin, so we have tradition to consider don’t you know.

   As for today, the US penny is made mostly of zinc and that is a more expensive metal to use than nickel or copper.  The change from copper and nickel was made to zinc when zinc was not as expensive as nickel, so back then it made sense. Most of the cost in the penny, as with all coins for that matter, is in the shared-overhead allocation; the so called sunk cost of the production process.  So even if the material cost were zero, there would still be a cost to produce and distribute. In that way the savings would not be so great to get rid of the good ol’ red cent (reference to when the penny had an American Native Indian on it 1859 to 1909.) 

The real show stopper is to follow that logic.  If there were no pennies, more nickels would have to be made and according to some studies, this would result in even a great net loss than the status quo. The nickel cost 11.18 cents each to make. So they are losing even more of their face value than pennies.  Yes, the transparent reasoning is then, ‘we're saving taxpayers by loosing less money making pennies than if we stopped making them at all.’  You have to be in the government for that to make sense.

  Yet too, let us give adequate homage to all those wonderful sayings we have today.  If not for the penny, where would we get;

A Penny Saved is a penny Earned Benjamin Franklin

Bad pennies always turns up

Cost a Pretty Penny

A Penny’s worth of prevention is worth a pound of cure

And my all time favorite

If I had a penny for every strange look I’ve gotten from strangers on the street I’d have about 10 to 15 dollars, which is a lot when you’re dealing with pennies.  Andy Samberg