In 2022, the US Mint produced 6.36 billion pennies and 4.52 billion in 2023 (the latter is a huge low) for a total of 10.88 billion pennies in two years. If we multiply that by its current cost to print of about 3¢, we come upon a figure of about 326.4 million dollars spint minting just the penny over two years, or nearly 50¢ per citizen per year.
In Canada, prices are rounded both down and up and have been for 12 years, and there’s been no evidence of “gouging”.
As noted, a multi-state 2006 survey showed that not only were prices not higher for consumers per transaction due to rounding but that in fact, they gained an extremely marginal 1/40 of a cent on average per transaction.
With these three facts, we’re already at a point where you’re gaining nothing per transaction by keeping the penny and you’re in a relatively steep penny debt each year by nature of them being minted. However, let’s continue.
If you routinely do cash transactions, try to consider how much of a cumulative hassle and overall cost pennies make things outside of just minting them.
If you’re getting pennies as change (which will happen as long as you’re not paying exactly with pennies and it isn’t a multiple of 5 cents), then you have a few options: a) “Keep the pennies” which loses you the pennies, saves some time, but still incurs that slight delay where the cashier needs to mentally process this. Or b) Waiting for the cashier to get the pennies out of the tray. If you value your time at a pretty measly $10/hr, even just two seconds of additional waiting for and handling the change loses you about half a cent. You also have to account for the fact that the penny makes it less likely that you’ll want to go through the trouble of having or counting out exact change, and so with the penny there’s more risk that this relatively lengthy transaction occurs where the cashier counts out your change, hands it back to you, and you put it away.
Now consider the hassle if you try to have exact change. You now need to carry around this other type of coin, find and count out enough of them to present to the cashier, and then wait for them to sort out the pennies to place into the appropriate tray. That’s almost assuredly multiple seconds lost.
Rounding to the nearest five cents massively increases the likelihood that you land on a cleaner denomination. Transactions which are $X.01, $X.02, $X.98, and $X.99 now get rounded to the nearest dollar, meaning no change at all is involved. Because previously those values were limited to $X.00 and $X+1.00, this effectively triples your chances of landing on a clean dollar value. For transactions which require quarters as the smallest denomination, this takes it from a 3/100 chance for $X.25, $X.50, and $X.75 and quintuples it to 15/100 by adding in $X.23, $X.24, $X.26, $X.27, $X.48, $X.49, $X.51, $X.52, $X.73, $X.74, $X.76, and $X.77.
These businesses need to go through the process of handling the pennies too, and if the volume of transactions is high enough (say in a grocery store), that is a marginal factor into what you’re paying.
The negative climate externalities of producing the penny aren’t factored into the cost to produce the penny. Their carbon footprint for the most part will nonetheless simply be passed onto the people (us) who have to deal with climate change. At 10.88 billion pennies, this is over 27,000 metric tons of zinc over the last two years, and while there are plenty of issues that dwarf that in absolute terms, relative to whatever “benefit” it confers (it’s actually a detriment), it’s pretty bad. There’s of course the fact that there are billions of pennies right now sitting out there as litter to consider as well.
Modern vending machines (which almost universally also now take cards as payment, but are probably still one of the more likely places you’d want to use cash) have literally no option for a penny because of how grossly impractical they are.
Unless you routinely count out exact change, you’re likely to have more pennies than you’ll actually be spending, and at that point, you just have pennies sitting around depreciating in value and doing nothing as opposed to at least offering you some utility. (There are even multiple Reddit threads on frugality about how you can get rid of bulk pennies at banks or by using them at the self-checkout.)
Pennies are pretty unambiguously a net detriment to everyone except the zinc industry. The one being gouged right now is you by being forced to subsidize the zinc industry’s less-than-useless product.
I’m not reading all that. I rarely use cash so all the bits about time spent handling it don’t affect me. Also it’s not me paying to mint pennies, it’s taxes, even if they stopped making them I wouldn’t get that money back. It’d just be spent on some other bullshit. The only factor I care about is the prices of things and after seeing what they did with the excuse covid provided I don’t trust corporations to not do it again.
It seems a bit dishonest to yourself to say that you don’t trust corporations while espousing a fear whose only source is the zinc lobby trying to retain demand for its product against overwhelming evidence of its uselessness.
“Even if they stopped making them I wouldn’t get that money back” except you would in the form of other places that the money could be allocated to. If you don’t trust the government to properly allocate money that’s fine, but now imagine that this argument were about the government buying $325 million worth of stuff every two years just to then catapult it into the Sun (not in a scientific way; just as in the closest way we have of physically getting rid of something forever). I can imagine you wouldn’t be making the argument that you wouldn’t be getting it back anyway and would instead rightly be asking why the hell the government is doing this. There are downsides to the government just wasting money.
I don’t think the first point will itself convince you of the penny thing since it doesn’t directly contradict your idea of ‘price gouging’, and the second one is just a point against this argument in general, so as my main point, I’ll leave you with this question and see if you can answer it to yourself: “What would be the mechanism by which this ‘price gouging’ would occur, and why hasn’t it happened in Canada?” Mathematically, rounding to the nearest 5 gives you the same odds of rounding up and rounding down, so how do corporations implement this dastardly scheme, and why haven’t they done it in Canada?
Nah, getting rid of the penny will require rounding prices of things and there’s no way stores won’t take that opportunity to gouge us even more.
There’s simply no evidence to support that claim and indeed evidence to the contrary. This is just misinformation spread by the zinc lobby, and I’m sorry that I have to tell you that, yes, the zinc industry is paying money to gaslight you into keeping their useless product around too. That is, this is zinc industry FUD.
With these three facts, we’re already at a point where you’re gaining nothing per transaction by keeping the penny and you’re in a relatively steep penny debt each year by nature of them being minted. However, let’s continue.
If you routinely do cash transactions, try to consider how much of a cumulative hassle and overall cost pennies make things outside of just minting them.
Pennies are pretty unambiguously a net detriment to everyone except the zinc industry. The one being gouged right now is you by being forced to subsidize the zinc industry’s less-than-useless product.
I’m not reading all that. I rarely use cash so all the bits about time spent handling it don’t affect me. Also it’s not me paying to mint pennies, it’s taxes, even if they stopped making them I wouldn’t get that money back. It’d just be spent on some other bullshit. The only factor I care about is the prices of things and after seeing what they did with the excuse covid provided I don’t trust corporations to not do it again.