by Mitch Kokai
Senior Political Analyst, John Locke Foundation
The latest Fortune offers us the following blurb about the long-term outlook for our one-cent piece:
Canada recently took an unprecedented action among North American countries: It abolished its penny. Why can’t America do the same? Pennies cost more to produce than they’re worth (2.4 cents apiece in the U.S.), and Canada figures it will save $11 million a year by eliminating the coin; the U.S. stands to save $60 million. Canadian merchants will round ($1.02 to $1; $1.08 to $1.10), and the inflationary impact should be minimal; it is in Europe and Australia, where pennies have been gone for years. But in the U.S. no one hates the coin enough to kill it. Plus, the zinc lobby is strong — last year the U.S. Mint’s sole supplier of penny blanks gave $140,000 to Americans for Common Cents to keep the penny alive.
Longtime Carolina Journal readers might recall a 2006 conversation with Wake Forest University’s Robert Whaples about the American penny’s uncertain future.