By Logan Parker / For The Herald
Imagine holding a piece of history in your hand.
The penny, a collector’s favorite, has been a connerstone of the U.S.A. since it was first minted in 1792! But the coin originates from 211 BCE; that’s over 2,000 years ago, but Americans are trying to eliminate the penny due to its high production cost.
Mark Weller (a member of the Public Policy practice with a focus on, market planning) stated, “The alternative to the penny is rounding to the nickel, and that’s something that will negatively impact working families every time they buy a gallon of gas or a gallon of milk.” Furthermore, it would also affect the lives of poor or ill people, it can also hold its value over many of years, but transitioning to nickels would lead to money issues and mess up the economy, because studies argue that rounding prices to the nearest nickel could result in consumers paying more over time, disproportionately affecting lower-income individuals who use cash more frequently. The penny must stay, but not without change to help the lives of the poor, the rich, and for the wellbeing of everyone and the economy.
Most U.S. coins have an expected circulation life of 20 to 30 years, meaning a single penny could be used thousands or even millions of times, but it costs more to make the coins than the coins’ face value is this truly worth it? It is worth it! Approximately 47 percent of coins minted are pennies and all these pennies (generally over 5 billion annually). Therefore, it doesn’t matter that the penny costs a few more cents to make then its face value. The U.S.A. makes billions off it every year and with a penny lasting about 20 to 30 years a batch lifetime would generate over 100 billion dollars. And according to the U.S. Mint, it costs more than 3 cents to produce a single penny, significantly more than its face value. This is largely due to the rising prices of metals like copper and zinc, which make up the coin. In contrast, higher-denomination coins such as dimes and quarters generate a profit for the Mint, but producing nickels costs the government $179 million in 2023 alone. This shows us that the penny may cost more than it is worth, but nickels have the same issue and will lead to even more money to be lost over time. The penny is important to the U.S.A. economy and helps generate more and more money every year while the solution is not any better if not a little worse.
Furthermore, pennies help charities and bring in millions every year. People donate lots of pennies to charities and organizations such as the Leukemia and Lymphoma Society, the Salvation Army, and the Ronald McDonald House. In 2009 the Leukemia and Lymphoma Society announced that school children had collected over 15 billion pennies in support of its charitable work; that’s $150 million dollars for blood cancer research and treatment. This proves people give lots of pennies to charity and taking away pennies would mean that those charities would get less money to help people and people care for charity. The penny to be eliminated, consumers, particularly poor consumers who are more likely to use cash, may pay several dollars more each year if all transactions are rounded up.
The penny is important to the economy. Proof of this is one study found that penny rounding in Canada costs grocery store customers an estimated $3.27 million Canadian ($2.5 million U.S.) annually. The penny is important to saving what would be billions of dollars because most of America is on the poorer to middle class side. Approximately 51% of Americans fall into the middle class. This figure has remained relatively stable around 50% since 2011. This proves that the elimination of the penny would heavily affect the U.S economy and over all would have no true benefit.
Rather than eliminating the penny; instead, it should be transformed into something better. A good example of this is the proposal to swap out the different metal compositions that make up each penny to reduce the cost of producing coins while ensuring their overall face value aligns with production expenses.
The penny needs to remain in circulation not only for the economy but also for the lives of the people who rely on that single coin.
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