Taxpayers pay nearly 2 cents for every penny made by the U.S. Mint — a poor economic model that makes the strongest case for abolishing the coin.
Stop making a coin that costs more than it's worth. The math isn't pretty. Each penny costs 1.67 cents to make, up from 0.93 cents in 2004. The Mint lost $31 million making 6.6 billion new pennies in 2007, and another $68 million making 1 billion nickels.Small change just isn't worth the effort anymore.
A penny saved is more often a useless penny since banks no longer roll coins, penny candy went out with bell-bottoms and offering someone a penny for their thoughts only begs the question: Is that all my thoughts are worth?
Congress has faced this issue before and punted. It should not this time. The metal content of a 1-cent coin is worth more than its face value. Copper prices have tripled over the past five years. Since 1982, pennies have been made from 98 percent zinc. Now the price of zinc has doubled. Moreover, demand for both metals is high because they are used for everything from machinery to suntan lotion.
Steel is not an option. In 1943, copper was needed for the war and steel became the composite material for pennies. That lasted a year before the pennies began to rust.
Other countries have made currency changes. England's move away from farthings, shillings and pence proves it can be done without an economic calamity. There would undoubtedly be a short-term hit as some costs are rounded up to a nickel. But other prices might be rounded down — say, a $1.98 item becoming $1.95.
A fear that people might melt their old pennies in the hopes of cashing in on copper's value is overblown. Copper pennies went out 25 years ago, meaning too few are left in circulation to seriously affect the metals market.
It takes 20 pennies to buy today what a single penny purchased in 1909, the year the Lincoln penny was first minted. Better to use a quarter and get a nickel back in change. That's our 2-cents worth.
