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President Barack Obama finally broke his silence on an issue of national importance Friday – he thinks it’s time to retire the penny.
The possible extinction of the one-cent coin was a featured economic question in a Google+ Hangout with the Commander in Chief last week as John Green, the co-creator of a popular YouTube channel, applied a little presidential peer pressure.
“Australia, Canada, New Zealand, many other countries have gotten rid of their pennies,” Green said. “Why haven’t we done it?”
“I gotta tell you, John, I don’t know,” Obama responded, adding, “Anytime we’re spending money on something people don’t actually use, that’s an example of things we should probably change.”
RELATED: Conservative thinkers: GOP should cut 'stale' policies loose
But why should anyone care? They’re pennies. Aren’t there more valuable things to worry about?
First, pennies actually cost more to make than they’re worth. In 2012, every penny cost 2.41 cents to make – more than twice their face value.
And as zinc and copper – materials used in minting the penny – have become costlier due, in part, to manufacturing shifts in China, which are likely to raise costs further.
Granted, the total cost of minting pennies was only $58 million last year – less than one-tenth of a percent of total federal spending in 2012 – but groups like Citizens to Retire the U.S. Penny have long been making the economic case for getting rid of the penny (plus, the group adds, fishing for pennies adds about 2 seconds to each cash transaction per day).
And the U.S. military has already decided they’re essentially useless; all Army and Air Force Exchange Service stores on bases round all cash purchases up or down to the nearest nickel.
With both parties looking for ways to cut government spending, it seems as though cutting penny production could be a relatively painless, if insignificant, place to start. But in the Google+ Hangout, Obama ceded that Washington has bigger fiscal fish to fry.
“The penny is an example of something that I need legislation for,” he said. “And, frankly, given all of the big issues that we have to deal with day-in/day-out, a lot of times it just doesn't -- you know, we're not able to get to it.”
There have actually been efforts to pass penny-banning legislation. Back in 2001, then-Rep. Jim Kolbe (R-AZ) introduced the “Legal Tender Modernization Act,” which would have made pennies obsolete by requiring retailers to round up or down to the nearest nickel on cash purchases.
That bill failed, and Kolbe’s second attempt in 2006, the “Currency Overhaul for an Industrious Nation (COIN) Act,” after zinc costs nearly doubled, met a similar fate.
But the president doesn’t need Congress to explore other, cheaper alternatives to zinc – the main metal in pennies. In fact, the administration’s 2013 budget encourages the Treasury to “explore, analyze, and approve new, less-expensive metals for all circulating coins like aluminum, iron and lead.”
It wouldn’t be the first time Abe Lincoln’s coin got a makeover. Back in 1982, the penny changed from 95 percent copper and 5 percent zinc to 97.5 percent zinc and 2.5 percent copper.
(And lest so-called “penny hoarders” try to melt that valuable pre-1982 copper down, the Mint in 2006 prohibited the melting of pennies and nickels. It also made it a crime to carry more than $5 in one and five-cent coins out of the country).
Changes to the composition of pennies do have Congressional champions: Ohio Rep. Steve Stivers (R) introduced the “Cents and Sensibility Act” in December 2011, which would mandate that pennies were out of American steel (much of which comes from the Buckeye State) and dipped in copper.
But these efforts will be met with some serious resistance from the zinc lobby (yes, there is one). The company Jarden Zinc, which creates “metal and zinc coinage,” according to its website, paid lobbyist Mark Weller $340,000 in 2012 to discuss issues related to “minting/money/gold standard” with members of Congress and the Mint, according to the Center for Responsive Politics.
Weller also represents the pro-penny group Americans for Common Cents, whose website warns of the risk of inflation that eliminating the penny would bring, and whose headquarters are on K Street, known for its many D.C. lobbyist offices.
“Americans for Common Cents aims to inform and educate policymakers, consumers, and the media about the penny’s economic, cultural, and historical significance,” the group’s website reads.
The political power of the penny is likely another reason Obama hasn’t acted on getting rid of it. As far back as 2008, when he was still a candidate, the “penny lobby” appeared to mystify Obama.
Asked about it at a town hall in Pennsylvania, he said, “We have been trying to eliminate the penny for quite some time -- it always comes back,” joking, “I need to find out who is lobbying to keep the penny.”
This story was originally published on Tue Feb 19, 2013 2:51 PM EST
Leave a Comment:
All President Obama has to do is sign an executive order banning the penny. Who's going to stop him? The Supreme Court? Not likely.
You have no real understanding of how the government works, do you?
He may not AndrewWoody. Explain how this getting rid of the penny would work, exactly. You sound like you know precisely what will happen.
HOF, The Senate passes it, Congress passes it, and Obama signs it. Obama doesn't have the ability to "sign an executive order" for something like this. Don't worry though, it's only how our government has worked since you where born, no reason you should know it.
Hasn't stopped him so far.
I'm sure the Republicans and the Tea Party will quote some bit Constitutional Law that will save the penny should it ever come up that we should get rid of the penny! Im sure if there ism some chance of losing the penny that Senator McChinless will see that the filibuster is used to prevent it from happening!
sky, liberals don't do the god thing. I rear rumors that they want it to be changed to one nation, under dumbama, indivisible with no liberty and justice for conservatives.
I'll get rid of the penny, if we can get rid of Obama. Fair trade
Please, eliminate the penny and nickel. Most people use debit or credit these days, so it really won't matter.
Keep the penny and get rid of the counterfeiters at the Fed!
Money should be worth more every year, NOT less! The bankers are stealing us blind, deaf, and dumb.
So is the government!
The crazy thing is the dollar is actually worth a little more since Obama took office. It's a fact look it up.
synthesis, bankers don't print (make) money, that be dumbama's posse's job.
unreal, you do realise you are wrong, right? No President is responsible or able to print money. It's a fact, look it up.
That must be driving Obama crazy. He's printing as fast as he can.
https://www.facebook.com/video/video.php?v=155452184609585
why not he is killing us
So this is what Obama's "Change" is really all about:)
finally it's out in the open!
The penny is the Change part of the Hopey Changey thing.
If Obama wants to retire something to aid the economy he can start with himself...
The dollar is up since Obama took office. Housing is recovering. The stock market is doing great. What else do you want from one man?
woody, you got it on for dumbama. You must, if you beleive everything you just wrote. As for what I want, is for him to stop running america into the ground.
unreal, what is false about what I said? Every thing I said is true, look it up and educate yourself before you try to debate things you don't know about.
He is already killing the dollar the penny is just collateral damage.
Is that why the dollar is up since he took office? It's a fact, look it up.
Sheep Not even your savior can keep inflation down forever, QE 1, 2, & 3 have increased the FED balance sheet over 600% and counting. It cannot be sustained.
Fact look it up.
But the dollar is worth more then when he took office, right? You are assuming something will happen and blaming Obama for it, right?
Right, a presumption based on evidence, kind of like global warming right?
Look have your fun, if he is really doing a good job then great, I hope I am wrong and you are right. You just cannot add 6 times the money to a market and expect the value of the currency to not inflate.
So now Obama or any President has the ability to print money? Find out how the government works and you might not blame Obama for every thing. The President actually has very few things he is able to control by himself.
Can you see past Obama'a naval from down there?
Are you mad about the fact that you talk straight crap about Obama that is not based in fact or that I am smart enough to no that what you say is crap with no facts to back them up?
Neither, why?
I don't let clueless liberals get me mad, you are a riot man. Sooooo smart you can't even grasp the simple concept of inflation.
You mean the inflation that has occurred since we came off the gold standard? Yes it will happen, the amazing thing is some how it will be Obamas fault like it is new. The amazing thing is it hasn't since he's been in office, I believe that might actually be a record? The dollar gained strength since he's been in office, why not look at that ACHIEVEMENT and quit speculating the failure that hasn't happened?
Woody, no means no, no does not mean know? You know. If the pres, doesn't want to spend, he can make it happen, if he has control and wants more money to pay for all the social programs, he can make that happen also.
unreal, read this article and get informed. The President has no where near the power you think, he can do very little by himself.
Obama is the SMALLEST GOV SPENDER since Eisenhower:
http://www.forbes.com/sites/rickungar/2012/05/24/who-is-the-smallest-government-spender-since-eisenhower-would-you-believe-its-barack-obama/
When stores need to round off to the nearest nickle I wonder which way it will go up or down. Care to guess.
I'll make this point again. Why would anyone round up or down? The hundreds of billions of pennies that are in circulation right now are not going to magically disappear when we stop making new ones.
What in the world would retailers do without the penny. No more $.99,$1.01,$1.99 prices at Wally World or any gas outlet.
Why not kill the penny? Obammys already killed the dollar! He is a worthless piece of sshhiitt! Playing golf with Tigger instead of working on the economy. I can't wait till this term is over so we can be rid of him once and for all!
Dr. E
Obama is the SMALLEST GOV SPENDER since Eisenhower:
http://www.forbes.com/sites/rickungar/2012/05/24/who-is-the-smallest-government-spender-since-eisenhower-would-you-believe-its-barack-obama/
The dollar is actualy up since Obama took office, look it up.
Friend, obozo IS working on the economy and it is exactly where he wants it.........Wake up!
King, are you talking about the fact that the housing market is recovering, the dollar is worth more then when he took office, or the fact that the stock market a.k.a. your 401k are doing great?
@Andrew...the value of the American dollar has plummeted vs. the Chinese yuan during the Obama years and the housing market is still down greatly during his reign as president.......the dollar has only strengthened vs. the Euro...good example of what Obama-type socialism does.....
What ANDRUMB / KING DUMBAZZ fail to acknowledge is the INEVITABLE INFLATION! Enjoy it while you can, jacakasses, because we are about to see inflation like we've never seen before. Look at gasoline; food prices; clothing prices, etc. They are already climbing! Don't be a brain-dead democrap! WAKE UP!
Dr. E
Sorry KING DAVID! Didn't mean to include you with ANDREW THE DUMBAZZ!
Dr. E
HopeisGone, The housing market is still down but much improved since Obamas election, thanks for admitting that yes the dollar is up and housing is improved. Is Obama to receive any credit for this or only blame for things that have not improved?
By the way ANDREW - Do you REALLY trust those stats?! If so, you are a bigger fool than Obammy is!
Dr. E
ANDREW WOODPECKER - I see you have failed to acknowledge the INFLATION issue that I mentioned. You know it's coming and it's Obammy's fault!
Dr. E
The inflation is coming, oh no. Sounds like alott of the other, is going to happens, I hear about Obama that always seem to never happen. If Obama is reelected there will be a civil war, sound familiar? Is the glass half Obama or half Romney? You guys always say crazy crap backed up with no facts and I am getting tired of being right. Don't believe the polls, Romney will win, the media is working for Obama. Do you guys ever cross reference your "facts" or stick to the media that says things you want to hear?
You have no background in economics do you? Trust me - INFLATION IS COMING, BIG TIME! Also, there is a two term limit - so Obammy cannot be re-elected. Even liberals have enough sense to have a president and not a king. If you have tired of being 'right' then you must be raring to go! Cause YOU ARE WRONG! I deal in facts alone and have no desire to be emotionally driven nor manipulated like the rest of you liberals.
Dr. E
So inflation would be a new thing under Obama? I'm pretty sure it has been happening since we came off of the gold standard and it is amazing it hasn't occurred yet under Obama. The dollar has actually gained since his election.
You truly are a simpleton. Look at Jimmy Carter's policies - almost identical to Obammy's. And, what happened? INFLATION, LONG LINES AT THE GAS PUMPS, SOARING GROCERY PRICES, ETC. It's going to come - I hope that I am wrong. However, I deal in facts and NOT wishful thinking such as yourself.
Dr. E
Rick Unger you cited is a flaming liberal that took so much heat for his imaginary analysis he had to close the response forum. Let's take the CBO figures:
2008: $2.98 trillion (Bush)
2009: $3.27 trillion (Obama blames Bush)
2010: $3.46 trillion (Obama)
2011: $3.60 trillion (Obama)
2012: $3.65 trillion (Obama)
2013: $3.72 trillion (Obama)
Obama is what everyone knows him to be.
We need to look beyond the literal fiscal costs of minting the penny. The penny keeps inflation in check and is the cost of having a fair economy. The penny is a massive teaching tool for millions of children across the country who are doing penny drives for philanthropy and savings. Every child has access to a penny, and as children learn about their government through the symbolic value of the penny including character building actions of Abraham Lincoln, the penny unlike any other coin is a messenger of dreams and possibility! ~Elaina Redmond, Author The Power of the Penny thepowerofthepenny.com
And if the penny goes away? The nickel takes its place in everything you mentioned.
Elaina, don't mind woody, I'm sure if you look anything like I'm looking at, that you have had experience dealing with dumb arse jerks.
So you prove it by becoming one? Good job, I bet she gives you her number, idiot.
......eliminate the penny and double food stamps?
"“I gotta tell you, John, I don’t know,” Obama responded, adding, “Anytime we’re spending money on something people don’t actually use, that’s an example of things we should probably change.”
Lets start with getting rid of the obama's and their million dollar vacations.
Lets hope "penny" eliminates obama.
I think obama looks ill, maybe he has aides.......from the "Men's Club" in chicago?
Did you complain about Bushs vacations? You know he took more, right?
The headline got me really excited and then let me down. When I saw 'Obama seeks to retire...' my heart leapt.
I wouldn't give a dime for Obama's 'red sense', to coin a phrase.
Though it's probably been said a thousand times already. He's killing the country. Why not the currency too.
Who cares about the penny? Oh wait. That's all us middle income people are going to have. He should end the hundred dollar bill since no ones making any real money anymore.
Or just agree with his buddy the anti-christ and just go straight to the mark of the beast.
Obama has already Killed The Dollar by running up the debt to 16.5 trillion and counting ...
he has killed the economy, so I'm sure he can kill the penny.
President Obama may not be able to kill the penny but he will be able to make it worth half as much.
Don't worry about the fact that the dollar is stronger since Obama was elected and just keep spouting crap. Facts don't matter just an enduing hate for the evil Obama. Boo, the sky is falling.
andy -
You are so far out in the weeds nobody is concerned about you...
Hey Dee, what did I say that isn't true? Is the dollar weaker since Obama was elected?
The problem will be that NOBODY will round down as they should, they will only round up and keep the overage. Basic human greed!
In a previous milennium the Dutch government was trying to cut costs. So they did away with the penny as everybody agreed how incredibly stupid it was to pay 2 cts of production cost for a coin worth only 1 penny. THe Dutch cent was taken out of circulation in 1983. That's 30 years ago. And Holland, believe it or not ,survived without the penny. It only costs 58 million to produce pennies last year. Imagine at that rate if US politicians would have been as smart as the Dutch 30 years ago . On the other hand with our track record they would have found ways to waste those savings in another moronic way.
We also spent millions on making dollar coins which was supposed to have each president on them. Just some stupid way of getting Ronald Reagan on a coin. Nobody wants dollar coins.
Not only did the Dutch do away with their penny; they did away with their entire system of currency (the guilder) and replaced it with the euro in 2002.
who cares about the dutch. lets all go there and smoke pot, enjoy legal prostitution and tulips.
A lot of people do believe that pennies are a waste just because it costs more than it's actually worth and that nowadays, people don't use pennies, they use thier credit cards or $20 dollar bills and get, as they call it, "useless" pennies back in change but the pennies are a part in history! They've been around longer than any of us have! Taking away the penny is like taking part of the lawn away from the white house! IT'S HISTORY! Pres. Obama is already making the US weird but actually taking away the PENNY!? C'mon! It's time he really look at the US history! They're good for little kids to collect too! The little saying? Find a penny, pick it up! All day long you'll have good luck will be taken away if the penny is taken away and the word dime or nickle doesn't fit in there anywhere! The penny is cute and it needs to stay!
that's as worthless a premise as I've heard. You want the goddam things - fine keep some. I just glue them to flower pots to stop slugs (copper is deadly poison to slugs)
Holland went EURO a long time ago. They make 1 cent Euro coins
1.00 EUR = 1.336147 USD