Professor's research supports eliminating penny

Wake Forest University News Service ^ | July 18, 2006 | Maggie Barrett

[justt bloomin]

Best research I've seen yet, and it happens to be from a professor within my department at my current university.

"Dear Old Wake Forest..."

[larrysh]

This makes sense....which is why nothing
will be done....

[DoughtyOne]

The guy may be on to something, but it amazes me that with the hundreds of billions if not trillions we waste, the focus on the lowly penny is rather humorous.

Yeah sure, let's get rid of the penny so we can justify spending $5 more trillion on welfare, or more hundreds of billions on services for illegal immigrants.

[Spktyr]

Um.. OK.

So, let's see. I purchase a drink for $1.00 straight up. My state/local sales tax is 8.25%. That means my drink is going to cost $1.08. So, without pennies, I get to pay $1.10 for the drink and I won't get change back.

That's a tax. Surprise.

[Graybeard58]

If you freed up that penny space, there would be an open place and, naturally, we would move to using a $1 coin.

Naturally? The dolllar coin has been tried and failed time aftertime. Making space for it in a cash drawer won't cause people to start using dollar coins.

The only way to get people to use a one dollar coin is to eliminate the one dollar bill and that's not going to happen.

Eliminating the penny sounds like a good idea though.

[Gunslingr3]

"The cost of making our money, the penny, is now more than 1 cent (per penny)," said Whaples. The increased cost is mainly attributed to the rising cost of zinc, the metal that makes up 97.5 percent of the penny, as well as to the costs of minting and transportation.

Let's be honest and attribute the increased cost to inflation.

[Between the Lines]

"There's this cash drawer sitting there with four slots for coins," Whaples said, describing a typical cash register.

From another article:

What would be much more efficient, Whaples said, is to stop production of the penny and make a dollar coin instead. He said with no use for pennies, a space would be freed up for a dollar coin in one of the five coin slots every cash register drawer has.

If this guy can't agree with himself on the number of slots in a cash register, I am not trusting his other math skills either.

BTW you can buy cash drawers with four, five or six change slots. The most common today is five slots.

[dr_who_2]

I'm for it, but it's depressing to think that the government savings here would be quickly lost to more spending on something else.

[Between the Lines]

If getting rid of the penny will save us $900 million per year, just think what we could save by getting rid of all coins and rounding up to the nearest dollar.

[lafroste]

It'll certainly make it harder to add my two cents to any thread at FR.

[farlander]

And if your drink is 1.30, you actually save. Your example is meaningless. It's about doing a crossection of the goods in various places and using statistical analysis. If the good professor says it's the same, and his statistics are verifiable, then I'm all about saving ourselves 1.5B a year. That buys a crapload of other fun stuff, say, for the troops.

[Larry Lucido]

Dr. Smith, maybe, but why Penny?

[RFC_Gal]

Notice how he left out the cost of changing and retesting all the software that is involved?

[Nomad817]

Since the reasoning behind pricing things at $3.99 is to make it seem more like $3 that $4, they might move it down to $3.95.

[Pikachu_Dad]

The sellors can fix this problem by setting their prices.

[RFC_Gal]

Their are three types of lies.

Version 1. lies, damn lies and statistics.
Version 10. lies, damn lies and benchmarks.

[Between the Lines]

Whaples said that based on the average American wage, $17 an hour, every two seconds of an average American's day is worth 1 cent. "That's going to add up to about $300 million per year for the U.S. economy," Whaples said.

If we are saving them $300 mil, the least they can do is round it down.

[LenS]

Hmmm, so we can't just simply change the metals used in the penny to cheaper one's?

Question -- if we round, who gets the difference when sales tax is involved? The merchant or the state? Why do I think that the states will make the merchants take the rounding down while they get the excess of rounding up -- which would force the merchants to price higher to compensate.

[gilor]

While right now I'm neither for nor against this proposal.

a nonprofit, nonpartisan think tank

Is a huge Red Flag!

[goldstategop]

I agree. Its better to create a $1 and $2 coin like in Canada and withdraw the $1 paper bills along with the antiquated, useless penny out of circulation. We'd gain a lot and lose little.

(Go Israel, Go! Slap 'Em Down Hezbullies.)