Over the past twelve months there have been considerable discussions of monumental public policy issues. But before 2016 ends we need to consider one more of (in)significant importance: what to do about the penny.
As the Wall Street Journal noted earlier this week, in fiscal 2015, the cost to produce a single penny was 1.43 cents. In 2014, that cost rose to 1.66 cents. Despite years of effort to wring costs out of production, it is doubtful the copper-coated coin will ever sink below the expense of making it, says Jeffrey Sparshott.
The actual cost to American taxpayers of having the cent is $45 million a year. That’s how much it costs, but not necessarily how much it is worth. “Worth is, with the coin, what it’s worth, the face value,” explains Tim Worstall. “Value is the value we gain from having the coin. The two are quite obviously not the same thing.” Worstall adds,
The reason this isn’t just some slam dunk decision is because that worth, that face value, isn’t the important point about the coin. Sure, we can see that the cost is 1.5 cents, the worth 1 cent, but what’s the value?
That is indeed the right question to be asking. And I think the answer is the value of the penny to Americans is negative. In this short video, “Death to Pennies,” C.G.P. Grey explains why we would benefit by simply killing the penny once and for all.