The news is finally official. It had been suspected and rumored for a long time. Now the federal government has finally admitted.
It costs more than a penny to make a penny.
This is not good. In fact, it’s illegal. Congress has told the us Mint in no uncertain terms that it cannot spend more than the face value of a coin to produce it. It makes sense. If there was more than a penny of value in a penny, people could just buy them and melt them down and sell them for scrap. The Hungarians did something similar to that after World War ii when they papered their walls with worthless Hungarian paper money.
But it’s not hyperinflation that is the source of the penny’s problems. It’s the price of copper. There is now almost two cents of copper inside each penny, which is ironic because since 1982, a penny is mostly made of zinc; only about 2.4% of a penny is copper. Nevertheless, it still would cost more to melt a penny than it’s worth. But that may not always be true. The mint is going to have to think of a better plan.
Of course, many people think they have solved the problem. Just get rid of the stupid thing. Nobody has been able to actually buy anything with a penny for years. The only thing it’s good for is to make sales tax come out even. And nobody would complain if merchants would simply round everything to the nearest nickel. Or dime, for Heaven’s sake.
Because of that, many people have taken to throwing their spare pennies into dresser drawers, glass jars, and water fountains. Heck, the Jerry Lewis collection tray at the drive-through at McDonald’s is full of them. People seem to be in denial. They just don’t want to have anything to do with them.
And that creates a problem for the mint. At the same time that they cost too much to make, they have to make more of them because people are hoarding them. It’s hard being a government entity.
I take the exact opposite approach. At any given moment in time, there are between zero and four pennies in my pocket. And none at home. None. None on my dresser. No glass jar collecting spares. No Pringle’s can that weighs a ton from collecting worthless copper — I mean 97.6% zinc and 2.4% copper.
Nope. I use pennies the way they’re supposed to be used. When I make a purchase that ends in 97 cents, I pull two pennies out of my pocket and hand them to the clerk. If I don’t have two pennies, I get three back in change. No more than four pennies are ever — I mean ever — required for any cash transaction.
See? Pennies aren’t a problem. You don’t need a jar of them. You only need at most four.
Oh, yeah, the mint says that a nickel costs more than a nickel to produce, too. They have nothing to fear. I’m not hoarding those, either.