Friday, April 6, 2012
If someone were to offer us a penny for our thoughts, we'd tell them to follow Canada -- and Australia, Brazil and Sweden -- and ditch the penny.
Canada will save its taxpayers $11 million a year by halting production and phasing out the penny. Studies have shown that rounding prices up or down to the nearest nickel balances out over time so there is no negative impact on consumers or businesses.
But the U.S. would still have to overcome the pervasive conspiracy theorists and those who believe everyone is out to rip them off.
Business groups in Canada supported the move. It was estimated banks would save about $20 million a year by reducing transportation, storage and handling costs.
Last year the United States spent $118 million to make $49 million worth of pennies. It just makes sense to halt this production.
However, the penny does have its supporters. The loudest is Americans for Common Cents, which talks about the historical significance of the coin and paints doom-and-gloom pictures of skyrocketing prices and the loss of income to charities that collect coins at cash registers.
Actually, the only one who would lose money would be Jarden Zinc Products, the sole supplier of zinc to the U.S. Mint. Last year Jarden was paid $52.2 million. Pennies in the U.S. are 97.5 percent zinc and 2.5 percent copper.
Not surprisingly, it is Jarden that funds Americans for Common Cents.
If Benjamin Franklin were alive today he might recast his famous saying to read: A penny unmade saves 2.4 cents.
And if we really wanted to save some serious money we'd phase out the paper $1 bill in favor of a $1 coin and save more than $186 million a year.