Rep. Jim Kolbe: Bye Bye Penny!

Posted by Alex in Money & Finance, Politics on June 4, 2006 at 2:02 pm


Because the price of zinc has shot up, the cost of production of a penny has risen above the coin’s value.

Rep. Jim Kolbe (R-Arizona) is planning to introduce legislation to eliminate penny from the US currency altogether.

The issue "used to be an oddball thing that Kolbe had an obsession about," the congressman said of himself. "Now it will become a necessity. We’ll be compelled to change."

The cost of producing the coin has risen from .97 cent per penny in 2005 to 1.4 cent per penny. At that rate, the Mint would spend some $44 million producing pennies this year, nearly $14 million more than in 2005.

"When the price goes to 1.5 cents per cent then everybody will figure it out," said Kolbe. "Then everyone will hoard their pennies because the metal will be worth more than the coin." Kolbe, who is set to retire from Congress after this term, joked he should go into the business of buying people’s pennies to sell them for their value.

Link - Thanks Jason!


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COMMENT

4 comments to "Rep. Jim Kolbe: Bye Bye Penny!"

  1. Roger
    June 4th, 2006 at 8:18 pm

    There was a West Wing episode that discussed this:
    http://www.tv.com/the-west-wing/war-crimes/episode/78317/summary.html

  2. v.dog
    June 5th, 2006 at 5:50 am

    1 and 2 cent pieces have been out of circulation in New Zealand for many years, and life goes on as normal. Most thing don’t change in price (you only round off at the end), and a lot of things get cheaper (by four cents, whoo hoo).
    Soon the 5 will go the same way. Some people will bellyache, but it really makes no difference in the way you spend your cash.

    I work in retail, and I can’t wait for them to go. They’re small and annoying to count.

  3. Milt R. Smith
    July 29th, 2006 at 6:00 pm

    Anytime some stranger tells you how concerned he is about YOUR welfare, LOOK OUT! Such is the case with Kolbe etal seeking to eliminate the penny. His state is still a big copper producer, and rounding up would benefit larger coins made of that metal(surprise, surprise). So what exactly do YOU, average consumer, get out of eliminating the penny? Will a cost of $5.71 now be rounded DOWN to $5.70, or rounded UP to $5.75? Let me guess …

    Look to him who profits is the old adage. Look hard and you’ll soon find who really wants to rid you of those nasty, troublesome, pesky pennies. Why would some organization suddely invest a lot of time, money and effort into a campaign to eliminate the penny? Because they’re a bunch or high-minded, civic-minded, patriots? Best to look behind the smoke, mirrors and veils for the truth. Why would they bother?

  4. Victoria
    December 18th, 2006 at 5:19 pm

    They weigh down our wallets, rattle around in our vacuum cleaners, and are summarily dismissed by most vending machines. You never have enough when you need them, yet their value is so inconsequential that store clerks leave bowls of them by the checkout counter completely unguarded.

    Still, when the glint of a grubby one on the sidewalk catches our eye, what do we do? Four out of five of us stop and pick it up.

    Pennies may be the most vilified currency still in circulation (a handful left as a tip is the ultimate insult to waitstaff), but according to a Coinstar (NASDAQ: CSTR) survey released earlier this month, we just can’t get enough of them. (Coinstar is also a Motley Fool Hidden Gemspick.)

    The 8th Annual Coinstar National Currency Poll found that 79% of people — 84% of females and 74% of men — will pick up a penny off the ground even though more than one-quarter of the population says it doesn’t even value loose change or keep track of it.

    so do not get rid of the penny!


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