Pennies: Enough Already!
Whenever I travel in other wealthy countries, I am a bit embarrassed about the dollar bill’s insignificance compared to other countries’ smallest bills: a 5-pound note is worth $9; a 5-euro note is worth $7; a 1,000-yen note is worth $9. At the same time, no rich country has a coin as worthless as the U.S. penny.
Imagine my surprise at the recent announcement that the U.S. will be issuing four new versions of the penny, the first of which comes out in February, in honor of Lincoln‘s bicentennial.
What a waste of resources — and what a move inside the production-possibility frontier! Each penny costs much more than 1 cent to manufacture.
Many people have called for the demise of the penny. It should go, but so should the dollar bill. After all, at 3 percent annual inflation, by 2030 the dollar’s value will have fallen by half; will we still be using dollar bills (and more worthless pennies)? I hope not.
It’s time to join the rich world; it’s time to stop wasting resources; and it’s time to stop transferring taxpayer money as subsidies to zinc producers.