per cent saying they would oppose it. 63 per
cent of small business retailers were in favour
of waving goodbye to the penny, mostly
because the majority of transactions require
one or more pennies, which stalls efficiency in
many stages of the process. Those in favour,
consumers and businesses alike, believed

not having a penny would mean more
efficient transactions and that the coin was an
annoyance; those opposing the idea insisted
the coin was part of our heritage and that
prices would go up.

With “heritage” being an extremely
irrelevant issue to consider, that leaves
the penny-lovers with one standing point:
inflation. As mentioned earlier, spending
is likely to go up when things are rounded.
However, avoiding this is simple by applying
the Swedish rounding method, which suggests that prices for goods
and services remain the same, and are then rounded up or down to
the nearest nickel. Because the rounding is symmetrical, meaning
that an equal amount of items would be rounded up and down,
businesses would not be able to charge more for their products. Long
term, neither the buyer nor the seller earn or save additional money.
And credit and debit transactions could still take place to the nearest
penny, which are by far the most common methods of purchasing
goods and services over $10. CERI) Lougheed Hwy

Harvard cconnaes professor Greogory Mankiw states the ; Pitt Meadows, BC
obvious when he says, “when people start leaving a monetary unit
at the cash register for the next customer, the unit is too small to be j UE Be eee eg
useful.” When somebody drops a penny, they often don’t bother to
pick it up—the time and effort isn’t worth regaining possession of the
coin. It may even be a while before somebody else decides to pick
up. It isn’t a lucky penny anymore, as the old adage goes, but rather
dead weight and a nuisance when you’ re looking for other coins in
your pocket or purse.

Neither the Canadian nor the American governments have
expressed any strong indication that they will abolish the penny,
but it has been considered for several years. If they don’t, it would
be wise to at least change the manufacturing technique their mints
currently employ. Rising costs of zinc and copper are harming

government budgets, so it makes sense that pennies and
nickels should be made from different material. Aluminium would
result in pennies costing closer to half a penny to produce, estimates
Scott Travers, author of the Insiders Guide to U.S. Coin Values 2010.
Another option would be to reduce the size of pennies and nickels to
a dime or smaller, another logical decision given their face values.

Demonetizing the penny or even changing the material it’s made
of is easier said than done, however. Zinc lobbyists are an aggressive,
powerful group that insist zinc coins remain in mass circulation.
Vending machine companies would be affected as well. The penny
isn’t accepted by very many, but the nickel’s abolishment would
trigger the need for millions of machines to have to be overhauled.
This would also occur if the penny or nickel became sized like a
dime, or any size swap that upset the way machines read coins for
prices. Of course, newer machines take credit cards, and thus old
machines are already being replaced in waves.

Like public transportation, pennies represent yet another way in
which North America has fallen behind Europe and other overseas
countries in how to run an efficient country. The government must
realize that sometimes, things are out of date—and playing the
“tradition” or “heritage” card just doesn’t cut it. The numbers are in
their favour, and why should they go against that?

For now, the Mint will continue making pennies, and the
government will continue losing money. And we’ll continue saying,
“Keep the change.”

 

 

 

 

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