[harls]

http://www.cbc.ca/news/canada/politicalbytes/2008/04/dropping_the_penny_wise_or_foo.html



Dropping the penny - wise or foolish?

Tuesday, April 1, 2008 | 10:48 AM ET

Pat Martin thinks the venerable penny isn't worth … well, one red cent. And so, the NDP MP has introduced a private member's bill, calling on the government to stop minting the one-cent piece.

"It costs more to produce than it's worth," he says.

Yes, he told reporters, there are billions of pennies still in Canadian change jars, "but it's just not money anymore so we think the time has finally come to do away with it altogether."

But a penny for your thoughts, Mr. Martin: How's a Canadian to pay $1.98 for a coffee without a few of those copper-coloured pieces?

"What other countries have done is introduce a rounding system that any purchase you make that arrives at say $19.97 gets rounded down. If it's $19.98, it gets rounded up."

But that can't make (ahem) sense, can it?

Won't a shopkeeper lose two pennies when rounding down and the customer lose two on the way back up? That would negate the latest GST cut on that $1.98 grande bold.

Buying three of those coffees would add up to six extra cents a day. Do that 250 days a year and you're out $15.

"Other countries that have done this, the experience has been revenue neutral," Martin said. And besides, it would only be for cash transactions. Pay with your credit or debit card and you still get to add up the cents.

But think of life without the penny: Your pockets — or purse — might feel a little lighter, but there'd be nothing to drop into the tip jar. And haven't we always been told that a penny saved is a penny earned?

What about charity boxes at the grocery store? Or donations to children's piggy banks? Surely, that's where the penny drops.

And then there's penny candy? Or is that perhaps, like the penny, a piece of nostalgia no longer in custom?

Thoughts about your penny
The Royal Canadian Mint says it costs 0.8 cents to produce a single one cent piece — a good deal on the face of it. On the other hand, the Desjardins Group gives us its two cents and estimates it costs more than $130 million to keep the slight coin in circulation.

The government produces about 816 million pennies a year and the Desjardins Group says there are about 20 billion pennies in circulation — a heckuva lot of coin by any calculation.

But, as Pat Martin points out, polls have shown the majority of Canadians don't even use pennies. They hoard them in change jars or toss them into wishing wells.

Still, according to the mint, 58 per cent of Canadians asked say they still need the penny. Seventy-one per cent said the penny — despite being "dirty, smelly and germ-ridden" — think the little coin is a part of Canada's heritage.

There's kind of an emotional attachment people have to the penny," Martin says. "But, you know, they'll get over it.

"Heck, we used to have halfpennies."

And he's right – at least in Britain and British North America in the 19th century. Since adopting the dollar as its currency in 1858, Canada has never issued a coin worth less than one cent. The British halfpenny went out of circulation in the 1960s, about the same time it was becoming impossible to find a halfpenny-worth of anything.

Is that where we are today? Can you buy anything for a penny any more?

Pat Martin doesn't think you can.

And so, he says, it's time for the penny to drop, one last time.

[Calgarian]

Get rid of it!

[Aylmer]

But we would be pennyless!

But seriously, it costs more than 4c to make a penny so it is a good
idea to let it go...

:)

[Calgarian]

What happens to the billions of pennies in circulation if it were to stop being minted? does it become free copper?

[240glt]

^ I've got about 10 pounds of pennies at home... hello $4.50 a pound for copper

Would sure beat rolling all of them

[The Kid]

Dump the penny. Think about dumping the nickel at the same time.

[jlousa]

Keep the penny, it does not cost 4c by the way, they haven't been made of copper for years, they are just coated. Who uses cash anyways? I'd much rather see them phase out cash. Plastic is the future.

[drew]

good riddance.

I liked the penniless system in Australia when I was there.

Although it somewhat shifts the "useless" coin spot from the penny over to the nickel...

[MolsonExport]

Pennies have not been made of copper for many years now.

Once upon a time, dimes were made from silver.


Get rid of it? Yeah, I think that its time has passed. I can no longer find penny candy (remember gummy bears and Swedish berries for a cent-a-piece?). Reckon that some firms will round prices upwards more than downwards, but we are still only talking about a couple of cents.

My reaction to having to roll pennies:
http://forum.skyscraperpage.com/image.php?u=397&dateline=1206976093

[LeftCoaster]

This is the smartest thing I've ever heard come out of the NDP.

The penny sucks.

[LeftCoaster]

Keep the penny, it does not cost 4c by the way, they haven't been made of copper for years, they are just coated. Who uses cash anyways? I'd much rather see them phase out cash. Plastic is the future.

I was thinking about this a while back, and I was wondering what in the world pan handlers are going to do when plastic becomes the standard in currency transactions. They will be hooped. its not like a homeless guy is going to be sitting there with a card swiper and an account with Visa.

[Mille Sabords]

The most annoying small-denomination coins are the super-tiny ones like the 1 euro cent. Also, for some unclear reason, there is a 2 euro cent coin. Huh?

Anyway - yeah, let's get rid of it. I have a jar full of them and I'll just use them to make a "treasure" for my kids to find one day.

[KrisYYC]

Keep the penny, it does not cost 4c by the way, they haven't been made of copper for years, they are just coated. Who uses cash anyways? I'd much rather see them phase out cash. Plastic is the future.


Get rid of the penny? Sure. Cash altogether? Hell no.

I still use cash as much as I can to save on debit service charges, not only that but paying for big ticket items in cash is a big bargaining tool and can be used to drop the price even further. Businesses prefer cash because they get charged for debit and credit card transactions.

[vid]

Buying three of those coffees would add up to six extra cents a day. Do that 250 days a year and you're out $15.

OH MY GAWD NO!!! :( :gaah: I NEED three large coffees every single day!!!!

:rolleyes:

I rolled 3.50$ in pennies this morning just to get rid of the damn things and if Mac's doesn't accept them, you'll be seeing me on a the news tonight. :banaride:

They have some uses but for the most part are just a nuisance. Prices are going to go up anyway. And having everything rounded to 5c will make figuring out prices a hell of a lot easier.

And for once I agree with Kris. When I get money in the bank, I take it the fuck out of there!! Using the machine at my branch of course, so that it's free. On top of the 1.50$ to 3.00$ the bank charges for each transaction, many local businesses add 10 to 25 cents to handle the fees they have to pay for having the machine to process it. The whole thing just seems like a cash grab to me. It's as bad as high taxes. Until they bring their fees down to something reasonable I'm not using debit.

[jlousa]

Wether we like it or not Cash is going the way of the dodo. I don't get dinged service fees, most businesses (if not avoided taxes) also prefer debit. The small transaction fee is more then made up by less administration costs let alone theft.

Will be interesting to see how petty crime works, buying coke from the dealer w/o cash. Sure they could set up phoney businesses where you get charged for a coffee and sandwich but get your coke instead. But there is a paper trail left. I'm sure they'll find a way around it but it will probably reduce it.

[WhipperSnapper]

get rid of it

Screw rolling! I just went to the neighbourhood grocery store with the neighbourhood self-checkout and dropped 300 of them into the machine. The cashier wasn't too impressed though

[quobobo]

Couldn't agree more. Economist Greg Mankiw sums it up better than I could:

The purpose of the monetary system is to facilitate exchange. The penny no longer serves that purpose. When people start leaving a monetary unit at the cash register for the next customer, the unit is too small to be useful. It is just wasting peoples' time--the economy's most valuable resource. The fact that the penny is costly to make only adds force to the argument.

Maybe we should get rid of the nickel, too. We can then round all prices to one decimal rather than two.

[KrisYYC]

Another reason why I don't think cash will go the way of the dodo bird is personal sales between individuals.

Selling used cars, furniture etc. would be pretty hard without cash.

I honestly don't get why some people would WANT a cashless society???

[quobobo]

Another reason why I don't think cash will go the way of the dodo bird is personal sales between individuals.

Selling used cars, furniture etc. would be pretty hard without cash.

I honestly don't get why some people would WANT a cashless society???

Don't forget privacy issues.

[mersar]

Getting rid of the penny is an idea, it could be worse though. The UK just released their new coins (a full set of general circulation at once), and they have even more coins then us, including the pence and two pence coins.

http://www.royalmint.com/web/MultimediaFiles/NEWDESIGNSREVEALED.JPG

Makes me curious as to how much the pence costs to make? It's about the same size as the penny, though the cost of material realized in GBP is where the difference would likely be.

[MichaelS]

Another reason why I don't think cash will go the way of the dodo bird is personal sales between individuals.

Selling used cars, furniture etc. would be pretty hard without cash.



Isn't that what Paypal is for?

[Boris2k7]

YES, get rid of the penny!

BTW, I usually go without cash. Almost everything I buy is charged to plastic, unless the place doesn't take it.

... which also infuriates me in that the University of Calgary suddenly decided to stop accepting VISA payments for tuition, which is forcing thousands of students to scramble for alternative payment methods, including myself. And they did it while ignoring the students union too, the bastards

EDIT: Also, having worked cashier in a home furnishing store, where people usually buy in bulk on expensive items, I can say it was an absolute dream to work in a place where almost nobody uses cash. The lines are faster and there's less confusion.

[quobobo]

Isn't that what Paypal is for?

Two problems: you're dinged a lot (although as the volume of transactions goes up the per-transaction cost would likely go down), and it requires the interaction of a third party. Going entirely cashless would mean a Paypal-like public entity, and I'm not comfortable with turning over that much personal financial information to the government.

[quobobo]

YES, get rid of the penny!

BTW, I usually go without cash. Almost everything I buy is charged to plastic, unless the place doesn't take it.

... which also infuriates me in that the University of Calgary suddenly decided to stop accepting VISA payments for tuition, which is forcing thousands of students to scramble for alternative payment methods, including myself. And they did it while ignoring the students union too, the bastards

EDIT: Also, having worked cashier in a home furnishing store, where people usually buy in bulk on expensive items, I can say it was an absolute dream to work in a place where almost nobody uses cash. The lines are faster and there's less confusion.

UBC did the same thing this year. It's annoying, but apparently it saves $2.5 million so I'm kind of indifferent.

[Boris2k7]

They've argued the same thing. My younger brother fired off an almost immediate response to our University that they should just slap on a service charge on VISA transactions instead of cancelling the payment method. Most students I know would gladly pay the charge rather than sit through the soon-to-be painfully long lineups. After all, what's a couple cents on a few thousands of dollars of tuition payments?

UofC students aren't particularly happy campers in the last few years due to this (pun not intended) penny-pinching administrators who continually have increased our tuition while giving little of anything back in terms of services, and then making it even harder for us to pay in the first place...

[93JC]

I don't understand the griping about "having to wait in line" while paying fees at the U of C. I payed by money order every semester: all you have to do is drop a cheque or money order, with you ID number on it, in a box. There's no line...

[93JC]

Oh, and I say we keep the penny. It doesn't cost 4 cents to make one, not even close. The way most economists jigger their figures around to make the penny seem like a bad idea is factoring in transportation costs: the money it costs to ship pennies to financial institutions. I can't remember the exact numbers off the top of my head, but I think if you factor that in it's closer to 4 cents per penny.

By the same logic, nickles costs us even more.

I just think it's moronic to have a centimalised currency yet no physical 1 cent piece.

[brannelford]

I just think it's moronic to have a centimalised currency yet no physical 1 cent piece.

Try to think outside the box! :yes:

Most currency systems are based on 100.
Despite this, many have discontinued the penny.
Could you imagine having the equivalent of a penny in relation to the old Italian Lira, Belgian franc, or Japanese Yen etc.

The penny is wasteful and unnecessary in the 21st century.

[Boris2k7]

I don't understand the griping about "having to wait in line" while paying fees at the U of C. I payed by money order every semester: all you have to do is drop a cheque or money order, with you ID number on it, in a box. There's no line...

This only works if you have a chequebook. And who the hell does money order?

EDIT: You'll also note that the maximum Money Order under Canada Post is $1000... which covers about 1/3 of my tuition.

[SpongeG]

i only use cash - pennies are a pain however

[Xelebes]

I simply go to my bank, show the bill and have it paid through that way.

[KrisYYC]

This only works if you have a chequebook. And who the hell does money order?

EDIT: You'll also note that the maximum Money Order under Canada Post is $1000... which covers about 1/3 of my tuition.


A money order from your bank can be any amount. That's how I bought my first vehicle.

[vid]

When I go shopping, I usually have my money ready so that I can be as quick as possible. I've found that debit and credit card users are slower than I am with cash but then I hate shopping and will purposefully keep track of how much I'm spending to get the hell out of there asap. If you wait until the cashier is telling you your total before reaching for your wallet, you're a jackass.

[Aefix]

This would be an interesting topic for a poll. I would be all the way for discontinuing the penny. It's pretty near worthless. Even nickels are pretty small but one issue at a time...

[Mister F]

All my nickels, pennies, and dimes go into a big jar. When it fills up it gets dumped into one of those self serve change machines in grocery stores. Sure it charges 10% or so but it's worth saving the hassle of dealing with such small amounts. Plus I use debit a lot, which is free if you know where to bank. I wouldn't miss the penny at all.

[MolsonExport]

Lets bring back the half penny and the farthing. :D

[vid]

Yes, and let's get rid of the lousy decimal system! It's so confusing.

[Aylmer]

And the Imperial is sooooo damn easy!

:rolleyes:

[entheosfog]

I still like to have cash on me at all times, even though for things over a certain amount I use debit. Nothing worse than having to pay for a coffee with debit; a lot of places make you buy a certain amount before you can use debit anyway. At a bar or nightclub is especially useful to have cash.

As far as the penny goes, meh, it doesn't bother me keeping it. I roll all my spare change (pennies, nickels, dimes) every six months and get about $75 at the bank. It really doesn't bother me either way...

[touraccuracy]

And the Imperial is sooooo damn easy!

:rolleyes:

i don't think you understood what he was saying..

[The Kid]

I still like to have cash on me at all times, even though for things over a certain amount I use debit. Nothing worse than having to pay for a coffee with debit; a lot of places make you buy a certain amount before you can use debit anyway. At a bar or nightclub is especially useful to have cash.

As far as the penny goes, meh, it doesn't bother me keeping it. I roll all my spare change (pennies, nickels, dimes) every six months and get about $75 at the bank. It really doesn't bother me either way...

Next time you're rolling, can I send over what amounts to about a garbage can full of pennies, dimes and nickels. I'll cut you in on 10% of the penny take!

[DizzyEdge]

get rid of it

Screw rolling! I just went to the neighbourhood grocery store with the neighbourhood self-checkout and dropped 300 of them into the machine. The cashier wasn't too impressed though

holy crap what a great idea.

[jeffwhit]

^^Yes, I don't know why that never occured to me. Finally I can get ride of all my useless change.