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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.”
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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:
The $.99 cent store can still charge $.99. The only people that will pay more are those that pay cash. Everyone else will still pay to the penny.\
In Arizona and California, those so called 99 cent stores are "99.99 cent only" (read the fine print) stores (and they round up to a DOLLAR anyway)
Why would the cash buyers have to pay more? Are the pennies that are in circulation now just going to disappear? That would be pretty impressive, since there are close to a trillion of them out there. Nobody's gotta round up or down for a long, long, time.
Eliminating the penny! Now that is really important!
Will that help Obama get a jobs plan?
Will that help Obama get a budget?
Obama is worth about 1 penny to the working Americans!
hey - 58million here and 58million there and pretty soon you're talking REAL MONEY ($58 MILLION last year to make the PENNY)
As much as they are a pain in the butt cents are necessary unless we want sales tax to go up by 5 cent increments rather than 1 cent increments.
The total sale, including tax, would be rounded to the nearest nickel. The sales tax rate does not need to be changed.
Actually, nothing really needs to be rounded. We will still have a remarkable amount (close to a trillion) of pennies in circulation. We took the mill out of circulation quite some time ago, and our gasoline is still expressed in tenths of cents without the entire country going broke.
The whole sales tax argument is weak anyway. So what if every cash transaction you engaged in was four cents more? Would that make a big difference in your life? You're talking less than thirty two bucks a YEAR if you have two cash transactions EVERY DAY.
He should put his picture on the penny first and eliminate it afterwards, this dumb president who just cares about himself, he should join the movie stars and the preachers, this is where he should be in front of the cameras. That's all he needs, that's all he wants, that's all he is worth. Having such a stupid president is a shame for America and the American people.
Farid
Totally agree! Thank you, I am glad to see there are intelligent posters on here.
Luckily we have free speech in America, which allows ignorant people to make stupid comments that are not based on fact, but strictly on opinion. And yes Farid, that would be you. President Obama has done a REMARKABLE job considering the fact he was elected during the worst recession since the Great Depression. A recession that was almost ENTIRELY caused by CONSERVATIVE economic policies with deregulation being the number one culprit. And considering the fact he is dealing with Republicans who are the definition for an OBSTRUCTIONIST Congress. And which has been their game plan since day one. Now I just stated two FACTS, NOT OPINIONS, that can EASILY be verified. Your turn, show me the FACTS to back your opinion.
and that major recession is STILL ongoing (with no thanks the nay saying RETHUGs)
Progressive
Do some research and you will see that Obama was a US senator during the Bush administration. The democrats controlled the house and the senate. Obama voted for the mess he walked into. Quit blaming Bush! Start blaming Obama and the democrats! You better hold on to the 2nd amendment rights or your 1st amendment rights will be next to go, the rest won't matter anymore!
progressiveforameerica, that would be like the pot calling the kettle black. Now, tell me one thing that he is willing to compromise no. He's playing the it's my ball and if you don't play my way, i'll take my ball and go home.
I have read most of the posts here and I have to say what cracks me up the most is when liberals blame Bush for everything while he was in office but now that we have KING Obama in office they go after congress and proclaim that it is not the Presidents fault. What a bunch of hypocrites! Most of the posters on here are either children playing their little prank games or liberal democrats that have nothing better to do while they are waiting for their next welfare check!
I'm waiting for my next welfare check. It comes from Social Security.
I will be more than happy to blame President Obama where it is warranted. For example: His cabinet choices which came straight from Wall Street/Goldman Sachs, etc and who were actually responsible for the worldwide financial meltdown. Or the fact he is as much in his own way a "war monger" as was President Bush. With the MAJOR difference being he did not involve us in enormous/incredibly costly police actions which have accomplished squat while killing brave American soldiers and draining our treasury.
As for "blaming Bush". The shoe definitely fits. He was president for 8 years and in that time period had a Republican controlled Congress for six of them. In that six year time period he had one veto (stem cell legislation) but suddenly found his veto pen (apparently buried under all that proof of WMD's in Iraq) when the Democratic party regained control of Congress after 12 years of Republican control.
And of course your statement "Most of the posters on here are either children playing their little prank games or liberal democrats that have nothing better to do while they are waiting for their next welfare check" shows ignorance, stupid generalization and most importantly; The VERY obvious influence of the right wing propaganda machine on your obviously limited thinking skills.
I get my SS about the 25 of the month. I WORKED FOR IT - they are just paying me BACK
SS is not welfare if you worked and paid into it. I have been paying into it since I was 13. I worked in my family business and it was perfectly legal.
Progressive
You must be one of the children otherwise you would think you are one of the intelligent people instead of throwing a tantrum!
Don't agree with dumbama must of the time, but the penny needs to go.
eliminating the cent translates to more cost. Things don't get rounded down they get rounded up. Who does this effect??? The ignorant poor people, much of whom voted this guy into office because he is looking out for all of us that don't make more than $250k, right?!
Most transactions are non-cash. They won't be affected by the elimination of the penny.
realist668, since most of whom voted for this guy, that is their problem. It's to late for them, just suck it up.
He might as well try.
After all, he is the man who re-painted and re-furbished Guantanamo and got millions of suckers to vote him into office again.
He is Superman.
The people didn't vote him in the first time or the second time. The ancient electoral college did!
We all know that. (well, sensible people do anyway)
Vote out the electoral, Vote in a real president.
President Obama got more than 50 percent of the popular vote both times -- a feat not seen since Franklin Roosevelt.
sorry charlie - there were more popular votes cast for Obama/ Biden than for those other 2 retards BOTH TIMES (unlike when da SHRUB "lost the popular vote" and was elected by SCOTUS... DON'T GO THERE - YOU LOSE
Oh you mean the Gitmo, that CONGRESS refuses to close? And CONTINUES to fund? THAT GITMO?
Yep Progressive, you are slowly learning.
A president doe NOT run America.
Oh, and as for the popular vote.
You can get that if you offer free stuff.
A chicken in every pot.
A cell phone in every hand.
AND SCOTUS had nothing to do with it.
YOU lost.
People are stupid.
Let's have a reasonable conversation on the topic. I penny no longer has a use. Round up or down and be done with it. We should also consider ending the paper dollar for a coin much like the euro. It is much easier to have coins in one's pocket than rummaging through a wallet or purse and the coin will last much, much longer. The old saying of watching the pennies and the dollars take care of themselves by substituting nickels for pennies.
It still makes a handy fuse replacement.
(if you can find one made of copper and not copper coated aluminum)
Viewer
I understand your comment but I would wager a bet that 75% or more of the people on this board have no idea what you are talking about!
it's not aluminum - it's copper coated ZINC (and the zinc industry is adamantly opposed to elimination of the PENNY for obvious reasons)
Fork
You have no idea what I am talking about or my point. Most people do not know how to replace a fuse with a penny! That is my point.
It may be zinc.
But it melts real fast under pressure from electricity. ;)
Tim some of us are still old time McGyvers.
And some are just a Fork in the road.
Viewer
You are so correct!
only fools replace those screw in fuses with pennies - there was a REASON that fuse blew in the FIRST PLACE. Fuses in house wiring are as out of date as BUGGY WHIPS - circuit breakers are the way to go. Remembering that unless there is a load across the fuse itself, it won't heat at all the penny (the zinc-copper one) won't melt. IF it melts you have a "bigger problem" anyway. One of the best uses for a copper penny is when you drill a hole into it and use it in a high pressure hydraulic circuit as a gasket. Those gaskets are EXPENSIVE
WOW Fork
You do know something besides what you hear from the liberal media! I am impressed! You can also make a copper gasket from tubing. It flattens out better than a penny.
And an old pantyhose makes a fine temp replacement for a fan belt until you can get it fixed right.
Some of us know how to make things work in a pinch.
We know why a fuse blows.
Oh and I have used one for a gasket.
Hammer it out, drill it, tighten it down and you are done.
Good idea.
Oh I don't know but I roll up change and keep it a while. Most of it is pennies. I bought a new Monitor for my wife computer and paid a $135 elect bill with the stuff one time. That was about a $270 dollar expense and it didn't even feel like it came out of my pocket. I still save and use this change and it saves me money out of my pocket quite often.
why not kill the penny? he has killed everything else American!
Lana
You are right! I might add that he is a freakin' muslim terrorist killing us from within!
Damn right, Tim...
Those of us with common sense have been saying for years get rid oof the penny it is a waste, hell the young just through them all over the place.
All politicians should agree on this issue and one other. Eliminate the penny and the one dollar bill. The country could save so much money by these two simple steps. Our representatives complain that the American public would not support it. Last I heard, the U.S. is a Republic, not a Democracy. Our elected representatives are supposed to use their best judgement to do what is best for the country and support the constitution, not necessarily what the ignorant masses want. It is time for Congress and the President to do their jobs. First of all defend the Constitution, then do what is necessary to get this country going back in the right direction. We waste money every day printing one dollar bills that have a limited life. Start using $1 coins and eliminate the penny.
Here it comes the One World currency.So if you have money saved up it will be taxed.
Elimination of the penny means cash transactions would be rounded to the nearest nickel, which in reality has the same effect as "take a penny - leave a penny." Non-cash transactions still may be calculated to the penny.
I still don't understand why gasoline still is priced at one-tenth under the next whole cent.
It makes it look cheaper to fools.
When I was a kid working at a major grocery (I won't name names) it went like this.
You could walk in the store and pass by bins full of (say canned corn).
The sign on the bin said SALE 2 for $1!!
You could go down the isle were the veggies were and get the same can for 49 cent a can.
I brought this to the attention of my supervisor one day and was told to STFU.
That's called a "Polish Special".
25 cents each, 3 for $1...
Why did your store have the same things for two different prices? Why wouldn't they just make it the more expensive one?
Impulse buying.
With the great job Obamas doing on the economy it will not be long till he gets rid of every cent Americans have.
Frank
You said it all in one simple statement. FRANK for President!
I have a seven year old grandson who could do better as president than Obama.
no offense but you may have great confidence in your grandson but a) he isn't OLD ENOUGH and b) he isn't educated enough
I, on the other hand, would take no prisoners when dealing with recalcitrant RETHUGs... (BUT I really don't want the job)
How sick are we of Obummer at this point.....................very. He is killing us slowly with government intervention and the so called Liberals who in their own mind think they are liberal but in actuality want the government to control their income and lives, and so we continue in our downward spiral with all Libs chanting and saying sure we'll pay more taxes, thinking they're liberals but they are so far from it they are blind. Woo!
so you'd prefer the fuc king IDIOTS who only know how to say NO to everything? That's smart...NOT!
In keeping with my policy on posters who call our President (or any President) by pejorative names, I have set Eagle 57 to Ignore This Author.
Seems like I struck a cord. It's good to vent your frustration like all the rest of us. See the minorities voted this guy in office and the rest of the Dems are like puppets to an administration who only sees control.
eagle57, invisible hand is just plain weird. you say obummer I say dumbama. potato or pototo.
nah invisible - ignoring the mentally handicapped just allows them to spout BULLS HIT. We can see the obvious lack of mental capability from the teabagger nay-sayers
I just don't bother responding to the obvious reichwingnutreligionazis. Let them babble - I don't CARE...
He is going to ruin the American economy before eliminating the penny, this weak and useless president.
Farid
He already did that when he was a senator but it is getting worse day by day!
Great idea. We can just round everything up to the dollar. Then all these monopolies like Walmart wont have to play the penny game on the consumer.
Better yet! when we get to the cashier why don't we turn around, bend over and have the cashier take the money out of our pockets too,
Amazing.
Hard
to believe obama wants to kill Lincoln.
Lincoln's image still graces the $5 bill.
You are good.....real good.
Obama knows the value of a penny.... its a shame he didn't of a dollar or he wouldn't have borrowed so much last 4 years.
The Treasury only borrows money when Congress pass law requiring it to.
Really? You libs believe anything you told.
Its another way obama is going to take more money out of the pockets of real Americans.
And a nickle costs us 9 cents to make. It has 5.7 cents worth of nickle in it alone.
Last time I checked, it was spelled "nickel."
Sorry, my bad!
It's OK....we all make spelling mistakes time to time....especially late at night, when we get computer eyes.
Great timing. This should get the left and right all wound up about a nothing. Is Obama bringing this up to get the sides warmed up for a big fight or a diversion from the real problems this country faces. The dunderheads will be arguing the fine points of the penny, when immigration reform probably has a doable solution in the wings, or is Keystone going to slide in while the sides square off in a senseless duel of the witless, and lets not forget Afghanistan the never ending blood bath, I wonder how many pennies it takes every day to fund that war.The senate and congress do have better things to do at this time than to start some frivolous argument about the value of a penny.Maybe some of these other countries have done away with the penny, but they also don't have a stack of real problems to solve. They aren't in Afghanistan, the don't have an immigration problem and for the most part the penny is probably the highest ranked problem they face.
The cost of making coins vary as the prices of the metals in them change.
As of about a year ago the costs were about
$0.0167 for a penny
$0.077 for a nickel
$0.04 for a dime
$0.10 for a quarter
$0.16 for a dollar coin
$0.064 for a dollar bill
invisible hand, last years news is old stuff! ge it?
I don't know about all the coins you mentioned but the penny has cost more to make then it is worth for alott longer then a year, how did you come up with these numbers? Maybe you ment 1.67 instead?
When I was in the third grade, we studied decimals. We learned that $0.0167 is the same thing as 1.67 cents. The costs cited are as of a year ago. Fluctuations in the value of our currency and the cost of metals will cause these costs to change.
Good on ya sir. You are correct and I need to go back to elementary school.