Penny pinching

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.

Mitch Kokai / Senior Political Analyst

Mitch Kokai is senior political analyst for the John Locke Foundation. He joined JLF in December 2005 as director of communications. That followed more than four years as chie...

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