The debate over whether the United States should get rid of the penny altogether or not is something that’s been going on for years now. People who want the penny to stay argue that as long as sales taxes and retail prices are continually rendered in cents, there’s no reason for consumers to stop using the penny. As a counter argument, opponents argue that if that’s the case then sales taxes and retail prices should be rounded up or down to the nearest nickel abolishing the need for pennies altogether.
President Barack Obama finally broke his silence on the issue earlier this year when questioned by John Green, the co-creator of a popular YouTube channel and the Commander in Chief of that week’s Google Plus Hangout. The possible extinction was one of the featured economic questions stated as, “Australia, Canada, New Zealand and many other countries have gotten rid of their pennies, so why hasn’t the United States?”
Obama responded by saying, “I gotta tell you, John, I don’t know. Anytime, we’re spending money on something people don’t actually use, that’s an example of things we should probably change.”
The main argument against the existence of pennies is that they actually cost more to make than their actual value. In 2012, each penny cost 2.14 cents to manufacture, which is more than twice their face value. The reason is partly because zinc and copper, the two materials used to mint the penny, have become more expensive since the manufacturing has shifted to China. In the future, the costs are only predicting to increase.
The United States Military has already taken its stand and decided that pennies are essentially not required. All of the Army and Air Force Exchange Service stores on the bases round cash purchases up or down to the nearest nickel.
The Democrats and the Republicans are both looking for ways to cut government expenditure, so why not start by cutting the costs that go into the production of the penny. It may be an insignificant place to start, but something’s always better than nothing.
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