My lunch bill at Cosi yesterday was $7.02, but I only had $7.
“Can you cover me the extra 2 cents?” I asked the cashier.
“Absolutely,” he said.
Stop the presses! Have businesses adopted an “Ah, don?t worry about it” policy? Have our local eateries incorporated “Cheers”-like accounting?
No, but the reality is that Cosi cares about those extra 2 cents about as much as I care to make sure that I have enough of them.
Why? Plain and simple: The penny?s time has come and gone and it?s now time to get rid of them.
Yes, yes, I can hear you screaming: Are we just going to flush Mr. Lincoln down the toilet? What will we throw into fountains? And what will become of PennyLane? Penny Loafers? Pennies From Heaven? And a “penny for your thoughts”?
Well, the best evidence for the penny?s demise is sitting in your own hands: Here at The Examiner, we could have charged all of you loyal readers a penny for the very newspaper you now hold in your hands. But they?re such a useless and worthless pain that, well, we decided that it?s just easier to give the paper away for free. That?s how worthless pennies are.
But joking and nostalgia aside, pennies have been rendered virtually worthless and it no longer makes sense to continue their production. Thanks to inflation?s toll over the years and the rising price of zinc (pennies have been made up of 97.5 percent zinc since 1982, when they made the switch from a primarily copper base), the U.S. Mint actually loses money by making pennies. A penny now costs more to make (1.4 cents) than it is actually worth. And keep in mind, when the penny came out in 1909, it was worth almost 20 cents in today?s money.
Part of the reason that the U.S. Mint has to produce so many pennies is because Americans are trying desperately to get rid of them. By some estimates, half of the 12 billion pennies produced by the U.S. Mint annually get lost in circulation.
So how do we get rid of them? Just ask Rep. Jim Kolbe, R-Ariz., an 11th term congressman who is retiring from the House of Representatives at the conclusion of his current term. He?s earned the nickname “The Penny Guy” around Capitol Hill for his dogged and tireless pursuit of currency reform. In 2001, Kolbe introduced the Legal Tender Modernization Act, which ultimately did not pass, but he hopes to give it a final push and reintroduce it before the end of the year and the end of his time in Congress.
Kolbe doesn?t technically call for the penny?s death in his bill ? his Web site indicates that he simply wants to “reduce the use of the penny” ? but it is clear that the ultimate goal of this reduction is to render the penny unnecessary in modern American finance and to ship the darn things to a permanent retirement at the Smithsonian.
Under Kolbe?s plan, all cash transactions would be rounded to the nearest nickel. Instead of a Snickers bar costing 77 cents, it would be rounded up to 80 cents. And instead of a lollipop costing 32 cents it would get rounded down to 30 cents. Physical pennies could still be used, but only in groups of five and virtual pennies could still be used in check, money order, credit card and electronic fund transfer transactions, including the Internet. Eventually, penny use would simply atrophy.
What happens to all of the pennies “lost” in the rounding process? The hope is that through trillions and trillions of these rounded transactions, consumers and retailers would come out even. Sometimes you round up, sometimes you round down.
Like most good ideas floated in Washington, however, Kolbe?s proposal is not likely to go anywhere. After all, the United States hasn?t significantly dealt with coinage since we killed the 3-cent piece in 1888. Further, Speaker of the House Dennis Hastert hails from Lincoln?s home state and one of the few states that still accepts pennies in toll booths (Illinois). And Senate Majority Leader Bill Frist hails from one of the biggest zinc producing states (Tennessee).
But Kolbe ? a conservative ? is truly a radical visionary on this issue, and Frist and Hastert might want to make a trip to a museum right here in Washington, D.C., in order to get a sense (cents?) of the future of pennies in the United States: It?s called the Squished Penny Museum.
Patrick W. Gavin is The D.C. Examiner?s associate editorial page editor. You can e-mail him at [email protected]
