In this time of massive budget cuts and a crushing national debt, you’d think Congress would be looking for non-controversial, easy ways to save money. Yet an option remains that no one has taken real interest in which would save the country sorely needed millions: the elimination of small value coins.
As of September 2012, it cost about 10 cents to make a nickel and about 2 cents to make a penny. Yes, that does mean that every time the government made one of these coins, it literally costs twice that amount of taxpayer money.
It is true that this cost has gone down in recent years, from a peak of 12 cents for each nickel and 2.5 cents for each penny, both in 2011. This is because Congress has taken steps to attempt to find a cheaper way to make these coins, namely switching to less expensive metals, like steel for pennies. But though they have taken some obligatory steps to cut down on the insane cost of making coins and there remains a vague plan to find a cheaper mix of metals or more efficient method of production to cut the cost, the movement to fix this glaring sinkhole has lost its momentum.
Australia, Finland, New Zealand, Norway, Sweden, the Netherlands and more recently Canada, have shown that cutting out pennies or equivalent small coins is a way to save quite a bit of money without causing job losses or decreased benefits, the United States Congress continues to ignore this issue.
The neglect of this logical fix can be linked to the fact that voters do not care about the issue. Representatives are only going to care about an issue, regardless of how effective it would actually be, if their constituents care. If an issue is not going to get voters fired up and help the representative get reelected, they will focus on issues that the average voter knows and cares about.
Representatives in recent years who have tried to introduce legislation about reforming the coin system have not belonged exclusively to one party, because it’s not a party issue. It’s a common sense issue. If a coin costs more to produce than it is worth, two logical options exist: to save roughly $44 million that this disparity costs the U.S. annually, we must either improve the methods and material used to make it, as Congress is nominally trying to do, or cut out the coins. If a method can be developed to produce these coins efficiently, then cutting them out is not necessary. But there is really no reason to have these coins, as the examples of other countries that have cut out coins for the same problems have shown.
One big reason cited to keep the penny or nickel is sentiment. People have grown up with the coins or collect them— what else will they use to make wishes or give pocket change to the Salvation Army bell-ringers each Christmas? But sentiment is not a reason to let the national debt continue to rise—and if we just let pennies and nickels stay around, that is what we are doing. If we don’t take steps for the fixes which are logical, if not strictly “easy,” then we will continue to make cuts to the far more important areas of government, and actually hurt people by losing jobs, aid, defense, education and so on.
Now I will agree that this is not an issue that can be fixed overnight. Like Canada, we would have to phase these coins out and reimburse people who have pennies and nickels. Canada’s method has been to phase it out slowly and collect pennies each year to melt down and recycle the metal. Their prices have been rounded up to the nearest nickel for cash transactions while online prices remain the same. So while this would take a while and things would cost more, cutting these small value coins would still save the U.S. millions of much needed money and help save the jobs and aid currently being cut.
So what can the average person do to help draw attention to this largely ignored issue? Write to your representatives. If they know that enough people care, then they will do something about it. If our representatives’ only incentive is reelection rather than actually helping the country, which it seems to be, they need to know that this is a noncontroversial issue that will secure your vote for them. So help inject some sense into Congress and urge your representative to eliminate small value cents!