Health & Fitness
ELIMINATE THE PENNY AND DOLLAR BILL
Here's a simple way to save the government some money - no more pennies and no more dollar bills.
The one cent coin is an unnecessary and costly pain in the arse and it needs to be eliminated. Pennies cost 1.6 cents to mint and they don't stay in circulation. People fill up dresser drawers, old vases, socks, coffee cans, etc. with pennies just so they don't have to deal with carrying them around. As a result, the government has to mint more and more of them and lose 6 cents for every 10 pennies that are minted. That amounted to $24,000,000 down the tubes (between the couch cushions?) in 2010.
Why do we bother? The only argument for keeping the cent that I've heard is that we'll be forced to pay more for items because prices will be rounded up to the nearest nickel. Not only that, but the sales tax would also get rounded up resulting in a tax increase.
Well, even if every transaction you made during the past week had been rounded up to the nearest nickel, my guess is that you'd be out about 58 cents. And in practical terms, sales tax paid would stay the same. It's just that the final total would get rounded up or down to the nearest nickel. It's the same procedure as now. If I buy something for 50 cents and the sales tax rate is 7%, the tax is technically 3.5 cents. But I end up paying 54 cents. Fractions less than a half cent are rounded down. It would work the same way to round to the nearest 5 cents.
Just to put things in perspective, in 1857, the last year of the U.S. half-penny coin, $1 was worth over $23 in today's money - meaning that a half-penny then was worth the same as 11.6 cents now. The half-penny is the smallest denomination coin the United States has ever minted. And already by 1857, we decided it was no longer necessary. Today's pennies are worth less than a tenth of what half-pennies were in 1857, and yet the U.S. minted over 4 billion of them in 2010.
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So why keep the penny? I have no idea. It's virtually worthless, it's expensive to mint, and it's a pain to carry around. Ditch the penny.
With the penny gone, we now have an extra slot in our cash registers for the dollar coin. It costs about 16 cents to mint a $1 coin and about 4 cents to print a dollar bill. The problem is that dollar bills only stay in circulation an average of 21 months, whereas a $1 coin would likely stay in circulation for 30 to 50 years. We would need to print fifteen dollar bills over that time for a cost of 60 cents as opposed to 16 cents for the coin. So there would be considerable savings by eliminating the dollar bill and switching exclusively to the dollar coin.
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And besides, I'm tired of dollar bills being spit back at me when I put them into vending machines.
In the grand scheme of the federal budget, the savings I propose here with the elimination of the penny and the dollar bill wouldn't matter that much. But it would matter some. If I got even just one tenth of 1% of the savings, I wouldn't be worried about paying my bills.
It's really such a simple and obvious thing to do to save a little money and a little hassle. The sooner we drop the penny and the dollar bill, the better.