Treasury Department set to phase out the penny

[BumRushDaShow]

Source: CBS News

Updated on: May 22, 2025 / 11:22 AM EDT


The Treasury Department said it plans to stop manufacturing the penny, calling time one one of the first coins minted by the U.S. government.

The federal agency placed its final order for penny blanks this month, with the United States Mint slated to end manufacturing of the penny when that runs out, a Treasury official told CBS MoneyWatch. The blanks — flat, metal discs that the Mint turns into coins — will run out in early 2026, according to the Wall Street Journal, which first reported the news.

The penny, which dates from the early days of the U.S. Mint after its establishment in 1792, now costs more to manufacture than the coin is worth. The 1-cent coin cost about 3.7 cents to manufacture and distribute in 2024, according to the U.S. Mint's 2024 annual report. Ending production of the penny will save the Mint about $56 million in annual savings, the Treasury said on Thursday.

Despite their coppery look, pennies are mostly made of zinc, with their distinctive appearance coming from a copper overlay. Zinc's cost per metric ton is more than double what it was in 2000, according to data from the Federal Reserve Bank of St. Louis.

Read more: https://www.cbsnews.com/news/treasury-penny-mint-to-stop-making-pennies/

---

Breaking on multiple sources. They are really doing a pre-Memorial Day holiday news dump today!

The Mint here in Philly used to have a bust of Ben Franklin covered in 80,000 pennies. It was created in 1971 (a couple years after their "new" building opened in 1969). But as I just found out, it has been replaced with a new one. lol



They apparently had removed all the pennies from the old one, melted them, and used them to create the new one that was installed in 2007 at a different location outside of the fire station there (and the new one includes 1000 keys - I guess as part of the amalgam) -

[wcmagumba]

1. Noooooo, I love pennies and used to have several of those folding blue collector books of them (lost in a move)...

I'm an old guy and a bit archaic...oh well, hail to the penny....

[Marthe48]

2. The ninnies put us in a pickle

Ninny and pickel were suggested, tongue-in-cheek, as names for a coin that would replace both. But works to describe the idiots running the show.

[Jilly_in_VA]

3. This will complicate sales taxes no end

What will they do, round them up?

[nilram]

7. New Zealand got rid of them in 1990.

For cash transactions, they'd round one way or the other. People and businesses figured it would even out for everyone over time. It'll be interesting to see if people here can grasp that concept.

[no_hypocrisy]

11. So, if my purchase has 11 cents sales tax, I'll have to

pay 15 cents?

[PSPS]

12. Standard rounding rules evens it all out [updated]

Last edited Thu May 22, 2025, 02:36 PM - Edit history (1)

(Edited because my brain was thinking there would be no nickels either!

When rounding a figure, the rule involving cents would be:

.01 - .02 rounds to .00
.03 - .04 rounds to .05

Also note that this is done on only the final bill amount, not each individual item. So the impact is meaningless.

Item 1 = 2.97
Item 2 = 5.75
Item 3 = 1.30
--------
Total = 10.02 would be rounded to 10.00
(If item 3 were 1.31, total would be 10.03 rounded to 10.05


Many tax forms don't even use cents anymore and round to the nearest dollar (.50 rounds to the nearest even dollar amount)

[SunSeeker]

17. Shops will always round UP, not down. This erodes purchasing power.

And is a gift to grocery stores especially.

[stopdiggin]

22. that hasn't been what happens in other economies

Other people have made this 'adjustment'. It's not a big one. And one only has to look at the fact that many people won't even accept their change in pennies now ....

[SunSeeker]

23. What the fuck are you talking about? People do accept their change in pennies.

And if you tried to round down it would be considered theft or shoplifting.

[stopdiggin]

28. no sir. you are wrong on both accounts.

many people do not accept pennies (there is an example just downstream in this same thread) - and/or if they (grudgingly) do, immediately ditch them when they get home, and refuse to carry them further.

and rounding up (or down, as has also been explained elsewhere on this thread) - is obviously instituted and dictated by store policy. (or, in the case of a functioning and regulated economy - by legal requirement - just as in the case of sales tax increments, etc. )

[SunSeeker]

85. And you sir are wrong on 3 counts.

First, I am not a sir.

Second, while some people won't carry them around, I, and many people I know, absolutely do. Poor people certainly do. I was poor. I know.

Third, yes it will be dictated by store policy, and if past is prologue, US corporations won't give a penny or two to the poor, ever, unless there is a law to require split rounding. I am aware of no such law. Are you? If you are, cite it please.

[stopdiggin]

112. "And if you tried to round down it would be considered theft or shoplifting."

Your statement I believe?
And if the 'rounding' is dictated by either the government, or store policy .. ?
Where in heavens do you come up with 'shoplifting or theft'?

Further, the 'rounding' of a penny or two (whether either up or down) on the purchase of a dollar or two's worth of goods and most purchase exceed that by a decent margin - even for the poor) - does not represent a crushing burden or hardship - on the poor or anyone else. Regardless the hue and cry - there is essentially no 'there' there. Just represents kind of a specious and hollow argument. And the kind that this particular grouping of gray matter - flags almost by habit. Sorry. Agreeing to disagree.

[SunSeeker]

122. Go to the grocery store and try it. nt

[stopdiggin]

129. when I go to the grocery store, the cashier tells me the total on my bill

There is no 'negotiating', debate, (or rounding) on my part. I either pay the amount indicated - or leave without groceries.
I have no idea what the situation is with your grocery ... But it sounds pretty unique to me.

- - - - - - - - - - - - - - - - - - - -

[SunSeeker]

132. You make my point. You pay what the store tells you, or you get no groceries.

You are correct that it is not a negotiation. If your bill for a pound of beef is $10.02 and you only give them $10, you're not getting your beef. If you try to walk out with the beef after slapping down $10, you've stolen 2 cents worth of beef. That's shoplifting.

[stopdiggin]

137. which of course has not a single thing to do with conversation at hand

which, as a reminder, began as a note on the discontinuation of the penny - and then drifted slightly to include the impact of 'rounding'. Not a single incidence in there of any suggestion about walking away with unpaid goods. For clarification, such an action has nothing to do with 'rounding'.

[SunSeeker]

139. Yes it does. And, "as a reminder," I was responding to your post.

The whole point of unpaid goods is to explain why stores won't round down unless there is a law that requires them to. Stores don't want you to get anything for free even if it's just 2 cents worth. As you note, you are required to pay not a penny less than what the item costs. They're happy to let you round up, of course.

[stopdiggin]

140. You voluntary round up your grocery tab?

Man, this is just getting better and better! Talk about unique!

Nobody on this thread (with the single notable exception) - is talking about hauling off groceries without paying ...

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

[SunSeeker]

141. No. Which is why I oppose getting rid of pennies when there is no law in place requiring rounding up AND down.

No grocery store will accept rounding down to the next nickel, absent a law requiring the them to to so. You acknowledged as much.

So getting rid of pennies without a rounding law in place hurts poor people because it gives their pennies to a store beyond what they actually owe, when they have to round up to the next nickel, because there are no pennies.

[stopdiggin]

142. well, at least we're no longer ploughing trenchant (and immaterial) ground

regarding theft and shoplifting! I guess that's progress.

My own position remains that the discontinuing of the penny is an idea that has been floated for quite some time now - is long overdue, while representing sound logic paired with financial sense and awareness - and will have close to negligible impact on virtually anyone in the marketplace, including the (well represented here) poor.

The idea of people nervously clutching pennies to their bosom - in hopes of staving the 'wolf from the door' in the scary and uncertain coming nigh - is, in this day and age, rather quaint. And more than a tad unrealistic.

'The poor' have literally hundreds of problems, hurdles and concerns. The discussion we engage in here does not represent either noticeable burden, or much in the way of sleepless nights. Believe me.

[SunSeeker]

143. I was never "ploughing immaterial ground." Pennies matter to the poor.

I know. I was poor. Me and my mom and my brother lived on my mom's minimum wage job. I remember having no money at the end of each month, not even pennies, and food would simply run out until mom got paid.

Of course the poor have bigger problems than penny discontinuance. That's why we shouldn't add to them.

Right now, a 5 lb bag of rice costs $3.52 at Walmart. If you are scraping together coins at the end of the month to feed your kids, having to pay $3.55, because pennies are discontinued and no rounding law is in place, needlessly adds to the burdens faced by the poor.

I will not be dismissive of the burden of this on the poor.

[stopdiggin]

144. And I will continue to maintain that the 'pennies matter' mantra

when matched to today's economy - is some combination of quaint nostalgia, coupled with dollop of wishful thinking.

I will grant that your heart is in the right place. But you're fighting a battle here that just doesn't have any practical import. To the poor, or anyone else.

[SunSeeker]

145. Eliminating pennies does indeed have bad practical import for the poor.

Eliminating the penny would disproportionately hurt lower-income individuals who rely on cash transactions for smaller purchases, leading to a "rounding tax" where prices are rounded up to the nearest nickel, effectively increasing costs for these consumers.

Rounding Hurts Consumers, Especially the Poor

To the first point, economists agree on one principle: businesses are guided by a desire to maximize profits. There is no obvious incentive for businesses to set prices in a way that will lead to rounding down. Research by Penn State economist Ray Lombra, and more recently by Georgetown fellow Robert Shapiro, shows that consumers would be hit with a multi-billion dollar rounding tax without the penny.

According to Federal Reserve studies, people with relatively low incomes (particularly the young, elderly and minorities) use cash more frequently than individuals with higher incomes. In our economy, 60 percent of transactions under $10 are still conducted in cash. Since only cash transactions will be subject to rounding, any move to eliminate the penny would be regressive and hurt “unbanked” Americans who have no other option and lack the means to make non-cash transactions.

https://insidesources.com/in-defense-penny/#:~:text=Rounding%20Hurts%20Consumers%2C%20Especially%20the,to%20make%20non%2Dcash%20transactions.

[stopdiggin]

146. this is an opinion piece (not sourced to the Fed, the CBO, nor any other recognized 'authority' )

that is now close to 7 years old. And in fact is 'authored' by a noted proponent and advocate on the issue.

"Mark Weller is executive director of Americans for Common Cents."
Americans for Common Cents is an organization based in Washington, D.C. that lobbies in favor of keeping the United States penny in circulation.

Article also includes such erroneous or outdated information such as:
"In our economy, 60 percent of transactions under $10 are still conducted in cash." (Not in 2025)
And continued assertions that a great majority of Americans support keeping the coin. (when in fact this is no longer true)

https://today.yougov.com/economy/articles/51865-more-americans-want-to-drop-the-penny-than-to-save-it

as a source, this is really reaching.

[SunSeeker]

147. The research by Penn State economist Ray Lombra, and more recently by Georgetown fellow Robert Shapiro are not opinion.

Last edited Sat May 24, 2025, 11:03 PM - Edit history (1)

The Yougov poll you cite says only 42% of Americans support eliminating the penny.

It makes way more sense to eliminate the nickel rather than the penny if cost is the issue, yet only 26% of people support eliminating the nickel, as noted in your Yougov poll. https://kfgo.com/2025/03/24/keep-the-penny-get-rid-of-the-nickle/

As usual, sounds like folks don't know all the facts.

[Bernardo de La Paz]

35. Wrong. The rounding in Canada is mandated by law and consumers and merchants love it. It's neutral.

Don't push nonsense when there is the obvious solution.

[SunSeeker]

86. That's CANADA, where people are also guaranteed free healthcare.

The US House just voted to let the poor die without healthcare. Do you think the US will object to the poor losing a couple pennies when they buy bread?

Cite me a law IN THE US that requires split rounding. You are the one pushing nonsense.

[Bernardo de La Paz]

89. Eliminating healthcare has nothing to do with eliminating the penalty. The poor would lose no pennies on bread

We are discussing a proposal. I thought it was clear that it is a proposal. How could you think a proposal is an enacted law? I certainly don't.

A law would have to be enacted. The law would be about cash transactions, the final total, and the rounding evens out. Merchants would obey the law. Since the rounding is neutral it would not affect the price of bead and the poor would not lose cents (pennies would be eliminated).

[SunSeeker]

93. What "proposed law" would require split rounding IN THE US? Name it please.

And yes, healthcare is relevant, because it shows what the US thinks of the poor, which is VERY informative of how penny rounding will be handled.

[Bernardo de La Paz]

96. The law that would be required to eliminate the penny would have to be proposed, passed and enacted. . . . nt

[Bernardo de La Paz]

110. The Bill regarding elimination of the penny was introduced in the House in February of this year

Look it up yourself. Not hard to find.

[SunSeeker]

120. Wrong.

It was Trump's social media post that was made in February telling Treasury to stop making pennies. There was no bill, let alone law, in place at that time.

The proposed legislation you appear to be referring to was drafted in April, not February, and nearly three months after Trump's social media post illegally ordering the Treasury to stop minting pennies. The proposed legislation is currently sitting in committee awaiting further action and has no bill number since it has not been released from committee, so it's not official yet, let alone introduced to the House for a vote.

Trump did not have the constitutional authority to unilaterally eliminate the penny without congressional action. The proposed legislation would make Treasury's illegal cessation of penny production legal, and provides that pennies would remain legal tender indefinitely.  https://www.abc10.com/article/news/nation-world/common-cents-act-stop-penny-production/507-85cf9ebc-c180-4a2d-874e-b2df999fbb8c

[Bernardo de La Paz]

124. You didn't search

February: https://www.congress.gov/bill/119th-congress/house-bill/1270/text

The April bill is separate. https://www.congress.gov/bill/119th-congress/house-bill/3074/text/ih

[SunSeeker]

127. You didn't read

That February bill by does not eliminate the penny, nor provide a rounding rule. It proposes suspending production of pennies and nickels for a period of no longer than 10 years, to "study the effect of the suspension of production of the one-cent and five-cent coins."

Only the April proposed bill actually provides for the elimination of pennies and sets out a rounding scheme.

[Bernardo de La Paz]

130. Fair enough. . . . nt

[thesquanderer]

116. Here is the bill for the proposed law. Yes, it includes rounding in both directions, as is expected and sensible.

https://mcclain.house.gov/_cache/files/2/1/21898f16-7471-415b-a387-d09fe01715d0/A81C0B3705AE0E991CE746E6A0E63A03767E976B5CED5B64C474B924BD4B417E.common-cents-act-final-text.pdf

It is a bipartisan bill, as described at https://mcclain.house.gov/press-releases?id=F5AD3C4A-B5AC-4320-8CE3-830D399917D4

It only affects cash transactions, and the rounding of those transactions ultimately work out equally in both directions, so the net difference to any individual is essentially zero.

It makes sense. But IMO it does not make sense to be against a good thing just because you're afraid someone down the line is going to screw it up. No one could ever be for anything good, if looked at that way.

[SunSeeker]

119. That proposal would still make people pay 5 cents for anything that costs 1-4 cents. But better than no law.

Of course we shouldn't avoid a good thing just because "someone" might screw it up. But we're talking the Trump administration here. Have they done ANYTHING right since they came into office? That someone will screw this up is a certainty, not some unreasonable "fear."

And as the OP states, the Treasury Department said it made its final order of blank pennies this month, because of a Trump social media post three months ago telling them to do so. And there was and is no law in place yet to deal with rounding, thanks to the Trump's incompetent governance.

The proposed legislation you cite, sponsored by 4 Dems and 1 Republican, comes nearly three months after Trump's social media order to the Treasury Department to stop minting pennies. It is currently sitting in committee awaiting further action and has no bill number since it has not been released from committee, so it's not official yet, let alone a law passed by Congress.

Trump did not have the constitutional authority to unilaterally eliminate the penny without congressional action. This proposed bill would make what Trump ordered (and Treasury's cessation of penny production) legal, and pennies would remain legal tender indefinitely. https://www.abc10.com/article/news/nation-world/common-cents-act-stop-penny-production/507-85cf9ebc-c180-4a2d-874e-b2df999fbb8c

We'll be attempting a lot of cleanup like this, for years to come.

[thesquanderer]

136. There is probably nothing in a store that costs 1-4 cents.

Of course, as is typical, the Trump administrations is doing something without fully thinking through the details. (See reversing tariffs, re-hiring back people they fired, etc.)

But this happens to be an example of what I think is a good thing, even if it will take some time to properly fully implement it. In the mean time, even though no more pennies will be made (at least until/unless someone decides otherwise), there are already so many in circulation that it will not be an issue to continue to use pennies for quite some time. And stores will have to continue to accept them until laws are actually passed to the contrary, since they are still legal tender. The odds that congress will pass a law officially phasing out pennies in cash transactions in such a way that proper rounding is not implemented is virtually nil, regardless of who is president.

Sometimes, even the worst administration can (intentionally or unintentionally!) do something that makes sense. I also happen to support RFK's attempt to get rid of artificial colors in food.

[SunSeeker]

148. There will probaby be nothing in a store priced to allow people to round down if such a law passed.

Without pennies, many prices will be rounded up rather than down, increasing costs for consumers. Although most shoppers will not be affected by this, it will negatively affect low-income shoppers and can be a contributing factor to inflation. https://lmcas.com/the-push-to-eliminate-the-penny/#:~:text=Price%20Rounding%20%E2%80%93%20Without%20pennies%2C%20many,a%20contributing%20factor%20to%20inflation.

[thesquanderer]

150. Of course many prices round up. But generally things are just as likely to round down, so it works out even.

Let's take all the 99-cent items, a disproportionally common price. You might say, ouch, now they're all a dollar. But if you were to buy three such items, you'd end up with a total that rounded down. (Rounding is done on the total purchase, not the individual item... which also means that the total you can gain or lose on any cash purchase at a store, regardless of the number of items in that purchase, is two cents. And again, the number of times you gain two cents will come out roughly equivalent to the number of times you lose two cents.)

Also, in most states, most items have sales tax applied. If, with tax, that 99 cent item were to become, for example, $1.06, it would be rounded down.

[SunSeeker]

151. Rounding does not "work out even" in actual practice; the total is most often rounded up.

The leading study on the subject found rounding up happens 60% to 93% of the time:

Economists have analyzed the likely distribution of such rounding adjustments, between those rounded up and those rounded down. The leading study examined pricing by a major convenience store chain in 1999 and 2000. Using actual prices, the researcher simulated 1,000, 5,000 and 10,000 different transactions involving purchases of one, two or three items, and found that between 60 percent and 93 percent of those transactions would involve rounding up to the next nickel. As a result, the author concluded that the rounding up and rounding down of all cash transactions to the nearest nickel would create additional costs for U.S. consumers totaling $318 million to $818 million in 2000, or in 2015 dollars, consumer losses of $438 million to $1.13 billion. Even the low estimate of $438 million is more than three times the total cost of producing all new pennies in 2015 ($130.1 million) and more than four times the theoretical production savings from eliminating the penny and shifting the equivalent total face value to dimes.

https://pennies.org/wp-content/uploads/2018/12/Economics-of-Eliminating-the-US-Penny-August-2017-docx-c.pdf, citing Lombra, Raymond (2007). “Eliminating the Penny from the US Coinage System: An Economic Analysis.” Eastern Economic Journal, Vol. 27, No. 4, pp. 433-442.


At Dollar Tree, where everything is $1.25 now, with L.A.'s 9.75% sales tax its $1.37, rounding to $1.40. Dollar Tree is where a lot of poor people shop for their food, so that can of soup a poor person buys at Dollar Tree will go up 3 cents. That adds up, especially if you're poor.

[thesquanderer]

152. re: Dollar Tree's $1.25 w/ sales tax $1.37, rounding to $1.40? No, $1.37 rounds to $1.35.

$1.36 and $1.37 would round down to the nearest nickel; $1.38 and $1.39 would round up, based on the proposed bill currently in congress (and also the figures used in the study you referred me to). From the proposed bill I linked to earlier:

9 (1) ROUNDING DOWN.—In any case in which
10 the total transaction amount, including any taxes,
11 ends with 1 cent, 2 cents, 6 cents, or 7 cents as the
12 final digit, the amount of cents in the sum shall be
13 rounded down to the nearest amount divisible by 5
14 for any person seeking to make payment with legal
15 tender.
16 (2) ROUNDING UP.—In any case in which the
17 total transaction amount, including any taxes, ends
18 with 3 cents, 4 cents, 8 cents, or 9 cents as the final
19 digit, the amount of cents in the sum shall be round20 ed up to the nearest amount divisible by 5 for any
21 person seeking to make payment with legal tender

That was an interesting link you provided, though, so thanks for that. Though I think a footnote to the section you quoted is also notable:

One researcher criticized Lombra’s study for failing to take account of sales taxes and argued that his own
analysis of transactions in seven states with sales taxes found little evidence of net rounding up or rounding down
(Whaples 2007). In Lombra’s response, he noted that many states, including the ten largest states, do not charge
sales tax on food, the most common cash item. Lombra further found that after applying sales taxes of 3 percent, 5
percent and 7 percent, consumers were still subject to a rounding tax (Lombra 2007)

So Lombra's main point is actually only partially supported by his data.

... For taxable items, his premise is supported with purchases affected by sales taxes of 3, 5, and 7 percent. So now we'd need to know what percentage of states have sales taxes of those numbers (or other numbers that more frequently round up), versus what percentage of states have sales taxes that more frequently round down (or have no sales tax at all). Then once we know which states his analysis applies to and which it does not, we could look at the size of the populations of those states, to finally reach the conclusion of how many people's purchases are likely to be rounded up vs. rounded down, even just within the other parameters of his study. (Actually, it's a bit more complicated than that since different areas within a state can have different sales tax rates, too.) While he says people will pay more 60 to 93 percent of the time, it seems possible that, with those other factors taken into account, his final conclusion could as easily be more like people paying less 60 to 93 percent of the time. Or as others have estimated, that overall, it simply works out about even.

... While it's true that many states do not charge sales tax on food, and that food is a common cash item, it can depend on the food. For example, in New York, sales tax is still charged on soda, sweets, and prepared foods. And if you google "do low income people disproportionately buy soda sweets or prepared foods" -- you can probably guess at the results.

If you're curious, the full text of Lombra's study is at https://college.holycross.edu/hcs/RePEc/eej/Archive/Volume27/V27N4P433_442.pdf, and a portion of Whaples' counter that describes additional issues with it is at https://www.jstor.org/stable/20642337 (I could not find the full text of that one.)

I think the critique of Lombra's study with minimal information available to counter those critiques without further research leaves Lombra's work limited in its usefulness.

Here's an article with a lot of interesting info about the penny, though it does not really address the particular issue of low income people, apart from a comment about nobody buying things with *all* pennies, which is not the point. Despite that flaw in the article, I thought there was a lot of interesting info there.

https://www.nytimes.com/2024/09/01/magazine/worthless-pennies-united-states-economy.html

no paywall: https://archive.ph/d5yWw

(Tidbit from that article, did you know that Obama also wished to get rid of the penny? Maybe one of the very few things Obama and Trump could agree on!)

A possible counter argument to theoretical comments about how bad it would be is to look at what has happened when actually done in practice, e.g. this from Money magazine, in an article discussing (among other things) how it's been done in various countries:

New Zealand eliminated 1- and 2-cent coins in 1990, and then took things a step further in 2006 with the elimination of its 5-cent coin. Researchers found that prices actually went down instead of up. One government official suggested that market competition was enough to keep retailers from trying to game the system.

https://money.com/get-rid-of-pennies/

I'm not saying that that's enough to expect that to be the result here, but the point is, a number of countries have done it, and it does not seem to have worked out badly.

[SunSeeker]

153. It rounds to $1.40 with no rounding law in place, which is the US situation now.

And we're not Canada nor New Zealand. We don't give a shit about our poor, as evidenced by the fact that we stopped production of the penny without a rounding law in place, unlike those countries.

[thesquanderer]

154. The current US situation is that no rounding occurs at all.

All that has happened so far is that the treasury will not make any more pennies (until/unless a future treasury secretary tells them to).

There are enough pennies in circulation that there is no immediate need for rounding. I would expect a bill (like the one currently proposed) will be passed by the time it actually becomes an issue.

[SunSeeker]

155. You have way more faith in the Trump administration than I do. nt

[thesquanderer]

156. It's not up to Trump, it's up to Congress.

A bipartisan bill has already been introduced. I don't see a rationale for a fight to make the rounding worse.

Yeah, Trump sometimes tries to interfere with what Congress is trying to pass. But all Trump cared about was getting rid of the penny. Beyond that, I don't think he cares enough to even try to get into the minutia of how rounding is done. He's not a details guy. And the rounding issue, no matter how it is done, is of no personal benefit to him.

[SunSeeker]

157. It's a Trump sycophant majority who is cutting Medicaid. You think they'll get right on that rounding legislation?

They don't give a shit about the poor.

And even if such a decent rounding bill is signed into law in the next few years, it is still no guarantee that rounding will always "even out." The only really thorough study on the subject we have says it won't.

I can believe poor people in New Zealand and Canada have no issues with loss of their penny, because they have robust social safety nets. But we are cutting SNAP at the same time we're getting rid of the penny. So this just piles on to that injury.

[Bernardo de La Paz]

34. No. It does not work that way. Nonsense. The law in Canada mandates rounding, which balances out

It is completely neutral for the consumer and neutral for sales tax and saves money for small business and large since they don't have to count and schlep pennies to and from banks.

Canadians are very happy with it.

[SunSeeker]

90. You are the one spreading nonsense. We are not Canada. We have no such law. nt

[Bernardo de La Paz]

94. I never claimed the US had such a law. We are discussing the proposal to eliminate the penny.

Like any economic proposal affecting commerce it would require a law.

Examples of such law exist in countries like Canada. They are practical and liked by both consumers and merchants. They are neutral to the poor, the middle class, and the rich. Those laws are about the final total of cash transactions and not about prices.

Those laws point the way to how the US could obviously enact a practical, useful and popular law.

I have never claimed that the US has such a law and your repeated assertions about that are only a Straw Man fallacy.

The US does not have a law about rounding cash transactions as a way of eliminating the penny. Clear?

[SunSeeker]

99. LOL. The "obvious" path is not the one the US will always take.

Example: US healthcare.

If the US doesn't care that 45,000 people die each year because they can't afford healthcare, it won't care that poor people will lose 4 pennies when they buy bread.

Clear?

[Bernardo de La Paz]

100. Healthcare has nothing to do with eliminating the penny. The poor won't lose 4 cents on bread

The price of bead will not be affected. Eliminating the penny is about cash transactions only which means the final bill for the transaction.

Regardless of "obvious" or not, if Canada and New Zealand can accomplish an elimination of the penny that both the public and the merchants like, then so can the USA.

[SunSeeker]

121. "if Canada and New Zealand can accomplish...then so can the USA."

That certainly hasn't applied to universal healthcare coverage, paid parental leave, or gun control, to name a few. We'll see if it applies to pennies.

[Bernardo de La Paz]

125. Eliminating the penny is much simpler than ANY of those. Obviously. . . . nt

[muriel_volestrangler]

19. Surely they'll be rounding to 5 cents, not to 10

which would be .01 and .02 round to .00, and .03 and .04 round to .05.

[Bernardo de La Paz]

36. Yes, as you say. It balances out, it's automatic in cash register, which is told cash or card

Cash rounds, cards are to the penny.

[PSPS]

52. Egads! I obviously screwed up my post and will correct it.

I was thinking there would be no nickel either! DOH!

You are correct, of course.

.01 - .02 rounds to .00
.03 - .04 rounds to .05

[stopdiggin]

20. absolutely not. the sales tax figure remains - 11 cents (which is of course bundled into your purchase price)

any 'rounding' that might be done (both up and down) would apply to total purchase price. And remember, any rounding of any sort, would only apply to 'counter' transactions, conducted in cash.

[Bernardo de La Paz]

37. No. Bill added up, tax computed, final amount rounded plus/minus to 5 cents not ten, and only if cash.

It all balances out. Merchant pays actual tax.

Rounding goes positive for consumer half the time, negative the other half. Canadian consumers are happy.

For merchants, round goes positive half the time, negative the other half. Merchants are happy because counting and handling time (is money) is reduced.

Rounding is mandated by law and is automatic in the cash register and only for cash. Nobody hates, everybody is fine with it.

[Jacson6]

74. When I was in Germany 40 years ago there wasn't a lot of US coin change around for the PX.

They rounded up to the next unit. But we had $2 bills!

[Polybius]

118. No

11 and 12 cents rounds down to 10. 13 and 14 cents rounds up to 15.

[stopdiggin]

15. no it won't.

your 6% sales tax - will still be calculated at - 6%. And, guess what - there was already a 'round up' factor built into the way sales tax works. Depending on where they 'draw the line' - 83 cent purchase, 5 cents tax - 84 cent purchase, 6 cents tax. (meaning you're paying an extra penny, regardless of how much you have spent between 84 cents and a dollar!) Rip off! Except - nobody cares, or even notices. And, as the basket of purchases grows larger - with the vast majority of purchase well exceeding a couple of dollars - any 'rounding' done becomes smaller - and smaller, and smaller.

And your 'cashless' transaction - either online, or when you 'tap' your chip at the debit reader (again, the very large majority of what happens today) - will vary not at all. With your bank recording that cup of coffee you purchased - at exactly the same $4.83 that it was the day before. Not a penny more, or less.

[Bernardo de La Paz]

33. Not a problem, no complication. Half the time the customer's bill is rounded down, the other half rounded up

Canada has done it for years. Canadians are pleased. No change in tax.

It all rounds out to revenue neutral and cost to consumer neutral. Federal government saves cost of minting pennies. Merchants and banks save time and money counting and lugging around pennies.

[customerserviceguy]

101. With so many transactions being electronic

there won't be any need to do that. And some will get rounded down if a person's paying cash. The Canadians did away with the penny over a dozen years ago, and it doesn't seem to have hurt them.

[Bo Zarts]

4. When Nixon told the nation to stop hoarding pennies, my wife began hoarding them in earnest.

She absolutely hated Nixon. Twenty five years later, tired of hauling pails and boxes of pennies on moves, she took them to our bank in Dallas, which cashed them in with no fee. IIRC, she got a check for over a thousand dollars for her spite-pennies.

[Freddie]

5. They haven't had pennies in Canada for years

Cash only. They still have .01 in checks, credit cards etc.

[stopdiggin]

6. long overdue. this is one place where public sentiment ran counter

to sound decision and good sense (unintentional pun). Despite protestation, the large majority of US consumers have virtually no use for the penny - and in large part refuse to carry then around. Have done for years.

(and, no - this does not mean that all financial transactions will be 'inflated' to reflect a 'rounding off'. Your 6% sales tax, on a 80 dollar basket of purchase - will still be - 6% )

[hlthe2b]

9. But, they WILL (round up)

[cstanleytech]

18. Depends what the laws will say.

If it says that businesses and companies can no longer charge by a penny for anything then it's not likely to mean to much.

[stopdiggin]

25. ONLY on cash purchases. and, even there, on any purchase greater than we'll say 2 or 3 dollars

(again, the vast, vast majority today) that 'round up' factor - even if we assume that it will always be up (which has not been the case elsewhere) - will become essentially meaningless.

This does not represent the big gouge to 'consumers' that many have always insisted on portraying it. The metrics are - minimal at best.

[hlthe2b]

26. The lack of concern for the poor who do not and will not have the access to credit cards, debit cards,

iPhone "flash & pay" (Apple Pay) or any other system outside of cash is appalling. You know better, and you surely SHOULD care "better."

I guess many of us are as oblivious to the future decimation of the poorest among us (already actively underway in Congress) as are our opponents.

Sorry, stopdiggin. I usually agree with much of what you say, but I find this just sad.

[Bernardo de La Paz]

30. It's neutral. Half the time it rounds down; other half time rounds up. Canadians are happy with the move years ago. . nt

[hlthe2b]

39. There is still a cash economy that is hard for many to remember--for the poorest among us.

Kindly think of them when you discount those pennies EITHER WAY.

[Bernardo de La Paz]

40. It's on the bill. The poorest in Canada have no problem with it. It's neutral, by law and automatic in the register. nt

[hlthe2b]

41. This isn't Canada. And our "conservatives" are in no way comparable or even rational as your worst.

Your faith in their policies is hardly born out in the language of the Big Beautiful bill that takes a small matter as that of the pennies and exponentially increases the damage from other policies.

[Bernardo de La Paz]

46. US cash registers work the same as Canadian. Probably made and programmed in US. And DONT SMEAR ME

Your smear is not the DU way.

I DO NOT have "faith in their policies". This has nothing to do with that. The law in Canada is simple, the registers are automatic, everyone is happy. American consumers and merchants will ensure the US law will be simple or there will be a big stink from everybody and it will be made simple.

This is not rocket surgery.

There is NO damage from eliminating pennies. It is all neutral and there is the gain of less bother for everyone: merchants, consumers, and the mint (which reduces the deficit).

This has nothing to with the Big Bum Bill. Do not attempt to smear me.

[hlthe2b]

48. Cash registers ring up the prices the owner charges. THis is idiotic, Bernard. I thought you had compassion.

And, no, it is not rocket surgery. Both a change in coinage and tariffs will give those remaining cash-accepting businesses every excuse possible to abuse the poor who cannot just pull out a credit/debit card or flash their IPHONE. The government does not set prices and every chain gas station/convenience store in the US have different prices for cash versus credit cards--for different reasons and different end results but it illustrated that the business can use these excuses to discriminate on pricing. This isn't Canada.

I don't really think you are unable to recognize this. Nor do I really think you don't care. But you aren't showing it. I really wish you'd been around when we had several very sincere yet "down on their luck" homeless posters that regularly interacted and advocated for policies for the poor. Many of us tried to help them--especially one in particular (Bobbolink, who has since stopped posting), but they really did open up our eyes to that which we routinely ignore--because what's a few pennies to you and I, right?

[Bernardo de La Paz]

54. I am going by the facts. You point to no applicable facts

You don't point to mathematics because math proves you wrong.

You don't point to Canadian experience which proves you wrong.

This has nothing to do with tariff taxes. Yet you point to that, which makes your argument a Straw Man fallacy.

It is not a case of setting prices. No prices are changed. That's not how it works.

This has nothing to do with homelessness. It is completely neutral for homeless people. You have no valid argument on that and it is a distraction to make such arguments.

This is so simple even America can figure it out and get it done neutrally.

[hlthe2b]

57. Look, I hate what Trump's policies are doing to Canadian-American relationships, but then you post this?

"This is so simple even America can figure it out " say YOU.

I said all of these policies IN THE US, NOT CANADA, are a cumulative attack on the poorest among us. You don't appear to give a damn about that and think we are all stupid so fine. We have had a good posting relationship in the past--perhaps we will again in the future-- so I am merely going to end here.

[Bernardo de La Paz]

68. This thread is about eliminating the penny. Dragging irrelevant policies into the discussion is a distraction.

This is about US policy regarding eliminating the penny. You have made no valid point about how eliminating the penny will be other than neutral for everybody with the bonus of eliminating a bunch of bother and the cost of minting.

Have you ever called Americans or America stupid? Hmm? Note that I did not actually do so in this thread. To be clear:

If America is all genius it can figure the neutrality of eliminating the penny.
If America is subpar it can figure the neutrality of eliminating the penny.

If you believe America is on balance above average and Americans on balance are above average, I'm happy to accept that premise for the sake of this discussion because it is irrelevant to the neutrality of eliminating the penny.

[stopdiggin]

32. even in the case of the 'poor' - the effect still amounts to - negligable

It's not a matter of having no sympathy or understanding - but rather in realizing that constructing some sort of 'argument' out of the actual figures involved - doesn't really square with realities.

Respectfully. The poor - are going to be a thousand times more crushed by the coming inflation due to our 'Big Beautiful' and tariffs - than they are by any negligible effect of 'rounding' on a 2 dollar purchase.

[hlthe2b]

38. "Negligible" to you and I who are so little affected-not so much for the "cash economy." I wish we still had Bobbolink

and several others who once posted here and who clearly were on the street. Their posts really opened the eyes of those of us who tried to help and, equally important, listened to them..

Respectfully, if you justify THIS, then the BIG BEAUTIFUL bill that decimates Medicaid, SNAP, Food Banks, and every other aid to the poor is just merely the next step. You and I may not fully wake up and feel the effects (beyond tariffs) until Medicare and Social Security is fully dismantled.

Like a frog in cold water-filled pot slowly brought to a boil...

[Bernardo de La Paz]

49. How about you stop using Republicon naming of the Big Bum Bill, which this has NOTHING to do with.

"affected", not "effected.

[hlthe2b]

51. It is additive. Just like tariffs and every single policy in that bill that will decimate the poor.

Yes, "affected," not "effected." Guilty as charged. Happy?

[Bernardo de La Paz]

60. It is not additive. You can't prove that. You haven't even tried to prove that. It is neutral

Getting rid of the penny will not decimate the poor.

[hlthe2b]

62. Says the Canadian who despite all of DU bemoaning Trump's damage to US-Canadian relationships

just posted on DU that Americans (sans differentiation) are stupid. Well, I don't hold that against all of the other kind, intelligent, welcoming Canadians--nor will I hold it against YOU. But you do as you wish, think as you will. You be you.

[Bernardo de La Paz]

64. Where. Provide the link for your assertion.

I said even America can figure the neutrality out, which makes no actual statement about American's intelligence.

This has nothing to do with the US Canada relationship. There you go again inserting irrelevant concepts.

[hlthe2b]

66. You are not worth my time. It was clearly highlighted in your previous posts. BYE.

I have been more than understanding Bernardo with your apparent obsessions.. I'm sorry you have nothing better to do. That is very sad.

[Bernardo de La Paz]

69. Should your personal attack be alerted? I'm not going to alert your post #66

I think it is a good use of time to knock down illogical attempts at points.

I think it is worth spending time pointing out that irrelevant statements are not points.

Yes, I am obsessed with logic, clear thinking, facts, actual experience, and relevancy.

[hlthe2b]

71. I made no personal attack, quite the opposite in ignoring your attacks* and hoping a future will resolve

this between us and return to what had been up to now, enjoyable interactions. I criticize your positions and self-described attitude toward the poor, which arguably discounts their plight. That is a changeable (mutable) feature of your discourse, not a personal attack.

[Bernardo de La Paz]

72. You wrote "You are not worth my time". . . .nt

[hlthe2b]

76. Not NOW you are not. Just posting the same thing over and over and over--ignoring my points & issues.

I don't want to put you on ignore, but I am going to ignore you informally on this thread. You have said whatever you wanted to say... repeatedly.

[Bernardo de La Paz]

81. You are the one repeating. I made points that you have not refuted. You repeat points I have refuted.

I have responded to every single attempted point you have tried to make.

You can point to any "point" you have attempted to make in any of your posts in this thread and I can point to where I have refuted it.

You have not refuted the mathematical neutrality of eliminating the penny when I made that point. You can't.

You have not refuted the economic neutrality of eliminating the penny when made that point. You can't.

[Bernardo de La Paz]

73. You mischaracterize me regarding the poor. When something is neutral to the poor it does NOT discount their plight

Eliminating the penny is neutral to the poor. It does not cost them or any person or any consumer or any person spending money.

You have not made a single valid argument that it does cost the poor. The rounding is neutral.

[hlthe2b]

77. Because I am not talking about taxes as I have stated repeatedly.

I will not continue to let you reframe everything I have stated to your tax argument, which I have never argued.

[Bernardo de La Paz]

83. You were the first to mention tariff taxes in posts 38 and 48. . . . nt

[hlthe2b]

8. Count me opposed. Since when is creating currency or coin supposed to be at virtually no cost?

Increasingly, I am finding businesses refusing cash or making it so difficult that customers just give up. Well, I don't get how that is ethical--if not illegal-- but I won't deal with them unless absolutely necessary. As one who has had credit cards cloned--twice-- despite taking all the precautions, I find this infuriating.

[Bernardo de La Paz]

42. It's neutral, it's automatic, Canadians love it, it saves EVERYONE time and bother. You have no points to make. nt

[hlthe2b]

45. This isn't Canada. GO read the Big Beautiful bill and the harms that will come to that population and

STOP IT. I am ashamed of you, Bernardo. We DO have poor--even some among our own posters. Pennies may seem like sewer drain waste to you and I, but they add up--especially when cash is being refused at many stores in the US and it will therefore be up to those remaining cash accepting businesses how to determine their pricing when pennies go away but tariffs remain.

[Bernardo de La Paz]

47. This has NOTHING to do with the Big Bum Bill

You are the one who should be ashamed to be using the RepubliCON naming.

Canada has poor. It does not hurt the poor. Not one bit.

It is neutral. No cents are lost or gained in the long run, which is about ten transactions. It's mathematical.

You have no point that stand up to scrutiny. Invoking the word the "poor" is not an argument because you do not show anything about where in actual implementations it has hurt the poor or even how it might hurt the poor. Nowhere.

[hlthe2b]

53. It is additive. As is a lack of compassion for the impacts (EFFECTS if you prefer) to the poor.

[Bernardo de La Paz]

56. It is not additive. No way. Simply saying that is no proof.

You have made no valid arguments. I have refuted every point you have attempted to make including your Straw Man attempts at distraction.

It has NO impact on the poor. Zip. Zero. Zilch. It is mathematically, economically, practically, and actually neutral.

[hlthe2b]

61. The impacts, the EFFECTS of all these policies ARE additive.

Goodbye, Bernardo.

[Bernardo de La Paz]

63. Getting rid of the penny is not additive. It is neutral and makes life easier. There are no "additive" effects.

You can't prove getting rid of the penny is "additive" or negatively impactful. You haven't tried.

Simply stating "the poor" is not an argument against getting rid of the penny, since there are no effects on the poor, additive or subtractive.

We are talking about getting rid of the penny. It has nothing to do with the Big Bum Bill or tariffs or homelessness. It is a Straw Man distraction to invoke those. You have made no points.

[hlthe2b]

65. Repeating your retort that tries so damned hard to reframe my point to your desired argument is so meaningless.

I've been quite understanding of you, but I'm done. Go bother someone else. I note that you have been. The only curious aspect is why you are so vested in the use of the penny in the US and whether or not we continue. Now that might suggest something... But, no, I'm not that curious.

[Bernardo de La Paz]

70. You have not been understanding that eliminating the penny is neutral and people like it where it has been done. nt

[hlthe2b]

78. Even reframing the use of the word "understanding..." as I used in my responses

Umm, okay.

[Bernardo de La Paz]

84. Fine. You have not been understanding of me. You have not understood that I am using economics and mathematics.nt

[SunSeeker]

149. Well then you should like Georgetown economist Robert Shapiro's study finding that eliminating the penny hurts the poor.

From his research paper, using economics and mathematics:

VI. The Costs to Consumers of Rounding Cash Transactions to the Nearest Nickel

When Congressman Jim Kolbe proposed the “Currency Overhaul for an Industrious Nation (COIN) Act” in 2006, it directed not only that the Mint stop producing new pennies, but also that all cash transactions would be rounded up or down to the nearest nickel. This approach was also adopted in the program enacted in Canada in 2012. Under The Canadian Economic Action Plan, the Royal Canadian Mint stopped the production and distribution of new pennies on February 4, 2013. While the Canadian penny remained legal tender, merchants were encouraged to round all final cash transactions up or down to the nearest $0.05. This approach was based on the view that Canada could reduce its coin production costs by eliminating new pennies and, since the penny would remain a pricing unit, there would be no negative effects on consumers or the economy. In practice, this approach entails significant, unintended costs.

Congressman Kolbe and the authors of Canada’s program were correct in one respect: retaining the penny for pricing purposes while eliminating it from circulation involves largescale rounding up or rounding down to the nearest nickel on billions of cash transactions. Economists have analyzed the likely distribution of such rounding adjustments, between those rounded up and those rounded down. The leading study examined pricing by a major convenience store chain in 1999 and 2000. Using actual prices, the researcher simulated 1,000, 5,000 and 10,000 different transactions involving purchases of one, two or three items, and found that between 60 percent and 93 percent of those transactions would involve rounding up to the next nickel. As a result, the author concluded that the rounding up and rounding down of all cash transactions to the nearest nickel would create additional costs for U.S. consumers totaling $318 million to $818 million in 2000, or in 2015 dollars, consumer losses of $438 million to $1.13 billion. Even the low estimate of $438 million is more than three times the total cost of producing all new pennies in 2015 ($130.1 million) and more than four times the theoretical production savings from eliminating the penny and shifting the equivalent total face value to dimes.

Moreover, this analysis almost certainly understates the additional costs to American consumers from eliminating the penny, because many firms would engage in strategic pricing to increase their revenues by ensuring that more transactions would be rounded up. Economic theory and evidence establish that firms set prices to maximize their profits, and we should expect that merchants dealing with large volumes of cash transactions would approach the elimination of the penny as an opportunity to do that, especially in high-volume, low-margin industries. For example, gasoline stations often price their products in denominations of fractions of one cent and round up the final charge; one study estimated that gasoline providers earn an additional $200 million to $400 million per year from this process.

These consumer costs from rounding up to the nearest nickel would also fall disproportionately on lower-income households. When Canada eliminated its penny, electronic payments with credit cards, debit cards and checks continued to be denominated in pennies, without rounding to the nearest nickel. A study from the Federal Reserve Bank of San Francisco found that 55 percent of people living in households with annual incomes of less than $25,000 prefer cash to other forms of payment, compared to 10 percent of those living in households with annual incomes of more than $200,000. The study further found that lower-income people use cash for about 57 percent of their purchases, compared to 33 percent of transactions by highincome people. The cost of rounding up is at most $0.02 per transaction, but those costs would accumulate much faster among lower-income people least able to afford it.

This dynamic would also disproportionately affect younger people, as they are more likely to use cash for their purchases as well. The San Francisco Federal Reserve Bank study found that 40 percent of people ages 18 to 24 prefer using cash to other payment methods, compared to 25 percent of those ages 55 to 64 and 65 and older. Furthermore, people ages 18 to 24 use cash for about 48 percent of their purchases, compared to 40 percent of the purchases made by people ages 55 to 64 and 36 percent of purchases made by people ages 65 and older.

Given these dynamics, it is also likely that some merchants would restrict electronic payments, especially in high-volume, low-margin businesses. Under current law and regulation, merchants can set a $10 minimum for credit card transactions, but minimums are not permitted for debit card transactions. In practice, many merchants do apply minimums to debit card purchases: a survey by the Federal Reserve Bank of Richmond of 420 merchants across 26 different sectors found that 29 percent of them used debit card minimums. Since eliminating the penny would increase the potential profits from cash transactions, it also would likely increase merchants’ use of restrictions on electronic payments to avoid cash, and thereby reduce the economic benefits associated with such payments.

https://pennies.org/wp-content/uploads/2018/12/Economics-of-Eliminating-the-US-Penny-August-2017-docx-c.pdf



Dr. Shapiro is a Senior Policy Fellow of the Georgetown University McDonough School of Business. He also served as the principal economic advisor to Bill Clinton in his 1991-1992 presidential campaign and as an economic advisor to the campaigns of Al Gore, Jr., John Kerry and Barack Obama. Dr. Shapiro has been a Fellow of Harvard University, the Brookings Institution, and the National Bureau of Economic Research. He holds a Ph.D. and M.A. from Harvard University, an A.B. from the University of Chicago and a M.Sc. from the London School of Economics and Political Science.

[Bernardo de La Paz]

158. Thx. The Joys of Being Wrong, the diligence of DUer "SunSeeker", and the Elimination of the Penny

Long story short: I made an assumption that was wrong, but then I found that I was kind of right in one way but the situation is a bit mixed.

Long story short on Elimination of Penny: Using Lombra distribution of prices, there is a cost to the poor of about 3 tenths of a cent per cash transaction if there is not a sales tax, but no cost if there is sales tax.

The joy is learning that I was wrong. Now I know better. I was however right in how it works in Canada based on grocery bills because they almost always have at least one taxable item (food not generally taxable).

There was a big discussion in GD about Eliminating the Penny. There was a lot of back and forth about greed and history and ways of doing it and fairness. I made an assumption to think mathematically about it and made arguments for fairness based (implicitly) on math. My assumption was wrong.

This came to my attention from a paper quoted by SunSeeker, who had done more due diligence in the thread than all of the rest of us put together. Hat tip to SunSeeker

In the paper by Shapiro 2017 it references a paper by Lombra from 2001, which I had to really dig for to find. Reading Lombra's paper I suddenly realized my folly. I had assumed random prices. I should have seen the obvious: a lot of prices end in 99 cents. There was veiled reference to a counter study with regard to sales taxes. Lombra rebutted it in 2007. His rebuttal seemed weak. Then I found the counter by Warples in 2007 considering the effect of sales taxes that Lombra was rebutting. Shapiro seemed to be ignoring Warples.

I wondered if the studies were done on slow old machines because 5,000 transactions seemed pitifully small for a simulation. I thought, "I can whip up a Python program lickety-split". Thus I embarked on hours long nerdiness tuning a program I wrote.

I ended up doing 16 simulations with over three hundred million transactions simulated. They were in four groups of four, each being about 20 million transactions. I simulated prices randomly in the range of 20 cents to 9.99, but I made the tail digit distributions fall into four classes. Lombra had 3,585 prices, I had 4,000. In each group I ran with no tax, medium tax, high tax and random tax in the range to the high tax. (Random taxes simulates a nationwide range.)

A summary of the summary: Rounding prices is the fairest, but not the most realistic policy. Random price tails is as expected even (fair) but does not exist. Realistic price distributions, either Lambro or another reasonable one are unfair by about 3 cents per transaction in the absence of taxes, but taxes make the rounding fair (not to forget that sales taxes are regressive). The level of taxation (when not zero) did not affect any scenario differently.

The fuller report and the Python program are in the Science Forum.

[brush]

10. Hmmmm? Wonder what nickels are worth now?

[moonshinegnomie]

55. about 13 cents

[Eugene]

13. Have they worked out this creating an even bigger problem with the nickel?

And has treasury worked out a rounding scheme as other countries have?

[Bernardo de La Paz]

44. No problem with nickels in Canada. Yes, Canadian Treasury is revenue neutral bc rounding evens out in long run. nt

[FakeNoose]

14. I grew up in the 1950's and I remember "penny candies"

Also gumball machines, but they were usually a nickel.

[JustABozoOnThisBus]

29. My childhood home was half a block from some railroad tracks.

We used to put a penny on the tracks, then try to find it after a train went by, to see how thin it was pounded. This was early '50's, so the coins were still malleable copper. I don't remember trying it with any other coin, those would have been too valuable.

[FakeNoose]

31. Yep ... we did that too when we were kids

... even though my mom didn't want us anywhere near the train tracks.

[BumRushDaShow]

67. We used to find them in the trolley tracks here in Philly

(those tracks are embedded in the street)

[SunSeeker]

16. I think this sucks. And like everything else, it will hurt poor people.

The rounding will always be a rounding up at shops. And that adds up after a while, further eroding the purchasing power of folks who makes lots of small cash purchases, namely poor people, who already are struggling to buy a gallon of milk.

[Bernardo de La Paz]

50. It is entirely neutral for the poor. It rounds out, it is automatic, it is no cost. Experience proves it. . nt

[SunSeeker]

75. We're talking America here. The "experience" in Europe does not apply.

Corporations rule here, and they will never round down their price. They will only round up.

[Bernardo de La Paz]

80. I did not refer to Europe. And you are wrong about corporations

I don't think anyone here referred to Europe. Canada and New Zealand, which were referred to are not in Europe.

Corporations obey laws about charging and collecting and remitting sales taxes. Likewise corporations will obey a law about rounding down and up to 5 cents.

Simply referring to the badness of corporations is a non-argument with regard to eliminating the penny. Logically.

[SunSeeker]

82. What US law are you referring to?

I am not "just referring to the badness of corporations." The US has a completely different attitude compared to Canada, NZ and Europe. We don't respect the poor or care if you lose pennies on each transaction. Unless there is a law that requires prices be rounded up at 3 & 4 cents and down at 1 & 2 cents as you are suggesting, then US corporations will only round up to the next nickel.

[Bernardo de La Paz]

87. I am referring to the proposal of eliminating the penny which would be enacted by a law.

The presumed (accepted for the sake of the discussion) "completely different attitude" does not mean that corporations and merchants would disobey the law, which would be clear and simple. They do not disobey sales tax laws.

The poor would not lose more cents (not pennies) on transactions than they would gain.
Likewise, the poor would not gain more cents than they would lose.

No. There would be no law on prices.

The law would be, as it is in Canada, that the bill would be added up, tax computed and added and then if it is a credit card transaction, paid to the cent. If it is a cash transaction, the amount is rounded to the nearest 5 cents and that is paid. Over the long run, say more than ten transactions, it evens out. The exact sales tax would be paid to the government. The merchant would not be out on sales tax because the cash transactions even out in the long run and there are thousands, millions, and billions of transactions.

The key is that the rounding is NOT on prices. Only the final cash transaction is rounded.

Companies and merchants would obey the law to the same degree they currently obey sales tax laws, which is so close to perfectly as to be negligibly different.

[SunSeeker]

88. So you're just making shit up. There is no US law requiring split rounding. nt

[Bernardo de La Paz]

91. The OP is about a proposal. The proposal is not shit. It is practical. It would be enacted by law. . . .nt

[SunSeeker]

95. THE OP DOES NOT DISCUSS HOW ROUNDING WILL BE HANDLED.

The rounding "proposal" you are referring to is your own. There is certainly no such proposed US law.

[Bernardo de La Paz]

97. The elimination of the penny would require a law rounding cash transactions. This is obvious.

When discussing the elimination of the penny, it only makes sense to discuss how that would be accomplished. This is obviously pertinent to the discussion of eliminating the penny.

[SunSeeker]

123. Tell that to Trump, who eliminated the penny via social media post, with no law in place. nt

[Bernardo de La Paz]

126. Got any more practical suggestions? He did not eliminate it. Be real. . . . nt

[SunSeeker]

128. It's not my suggestion. Trump tweeted he was ending penny production and Treasury complied. All illegal of course.

But he did it anyway. Like his tariffs. And his El Salvador prison deportations.

In February, President Donald Trump announced that he had ordered his administration to cease production of the 1-cent coin.

“For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!” Trump wrote at that time in a post on his Truth Social site. “I have instructed my Secretary of the US Treasury to stop producing new pennies.”

https://www.pbs.org/newshour/nation/u-s-mint-moves-ahead-with-plans-to-kill-the-penny#:~:text=In%20February%2C%20President%20Donald%20Trump,on%20his%20Truth%20Social%20site.

Be real yourself.

[Bernardo de La Paz]

131. He can order the tide to recede if he likes. That doesn't make it real. A tweet is not an Executive Order.

And even an Executive Order is not automatically a real order. Some of his are simply declarations.

Your suggestion was to "tell Trump". That is not practical for you or me.

[SunSeeker]

133. His declarations are treated as law by his subservient executive branch.

And they ignore actual laws. They're basically criminals. I'm sure you've noticed.

[moonshinegnomie]

59. becasue of teh way rounding is done it wont hurt them

total ends in 1 or 2 round down to zero. 3 or 4 round up

[SunSeeker]

79. That is not how the rounding will be done in the US.

US Corporations will not lower their prices, they'll only round up. This isn't Europe where poor people have respect, healthcare, etc.

If you have a link to some US law that requires rounding like you are suggesting, I'd love to see it.

[moonshinegnomie]

104. just going off texas laws

sales taxes are calculated to the 3rd decimal point and thats used for rounding. from the state


When you calculate the sales tax by multiplying the tax rate by the sales price, calculate the tax to the third decimal place. If the third decimal place is equal to or greater than five, round up to the next cent. If the third decimal place is four or less, round down to the next cent.


pennyless rounding will be done the same way. no company wants to be busted cheating their customers over rounding.

[mopinko]

21. good. i've been refusing to take them for yrs. they arent money any more.

there’s a few small stores where i shop that dont use them. they round just like they taught us in math class. and a few know me well enough to not give them to me.

they just arent money any more. they have bought anything i years.
the mining and manufacturing to make them, however, is a pox on the planet.

[Canada Kid]

24. A penny for your thoughts

Canada replaced the penny years ago. Also with much trepidation and consternation. All works well...just a round up or down to the nearest nickel. But they also realized that Trump's fat face would hang off both sides of the coin....and the words "In Trump We Trust" meant putting a lie on a coin of the realm.

[cbabe]

27. No more make a wish penny in the fountain? Sigh. The modern era.

[SeattleVet]

43. When I was stationed in Germany the US stopped sending pennies to the base banks.

This was in the late 70's, and it was costing more to ship them over there than they were worth, so everything got rounded up or down to the nearest nickel at checkout.

The rounding to the nearest $.05 worked very well. One guy in my shop was totally convinced that since prices usually end in .98 or .99 they'd always round up, forgetting that multiple item purchases negate that pretty quickly.

We bet on it and did an experiment - for one full month we kept track of all of our purchases. At the end of the month one of us was 'up' by 11 or 12 cents, and the other was down by 5 cents. In the long run it was essentially a wash.

There will be no difference in non-cash transactions (credit/debit card), and a minuscule difference over time for cash transactions.

[underpants]

92. I think my time in Germany is why I hate having change in my pocket

Lots of coins. The thing I liked was that the price was the price on things. If it was rounded up, fine.

.98 .99 Is a very American thing I’d guess. It probably has some string psychological bases like has gas is priced.

[Bernardo de La Paz]

111. The rounding from the elimination of pennies would be on final transaction, not on prices. . . . nt

[underpants]

117. In Germanic if it said 4 12 or 18 it was that

We went ice skating. You could skate up to a counter and get warmed wine for 2. It warmed the soul like hot chocolate but the thing with this stuff was that it made you lose your balance fall down.

[moonshinegnomie]

58. i have no problem with dumping the penny

it costs over 2c to make them out of zinc coated with copper. I know at one time they looked at aluminum cents but that wasnt practical for assorted reasons so its time to kiss it goodbye. it wouldnt be the first tim ewe dropped a demnomination
we used to have 1/2 cent 2 cent and 3 cent coins. and $2.5,$3, $5 ,$10 and $20 gold coins

[FSogol]

98. Irrelevant: "costs more to manufacture than the coin is worth." That would only matter if the coin was only used

a single time. Pennies stay in circulation, getting spent and re-spent repeatedly, for decades.

[moonshinegnomie]

105. in 2024 it cost about 2.5c to make a penny according to the mint

they made 3.2B pennies.
that means they lost 50M making them last year.
most pennies just end up in a drawer. its estimated that up to 2/3 of them are never spent again,thats why they have to make so many per year.
just like the 1/2 cent coin its outlived its usefulness

[moonshinegnomie]

106. these are a few countries that have dropped their equivalent of teh penny

canada,hong kong,israel,jamaica,new zealand,australia,south korea,japan,

[bucolic_frolic]

102. Capitulation to Trump inflation

Will they round up, or down? $10.07 is really $10.10?

How are merchants going to balance the books?

[Bernardo de La Paz]

113. Not capitulation, not rounding prices, no problem balancing books.

Canada dropped the penny in 2013, before tRump shoved himself into our faces.

Cash transactions would be rounded, not prices, not taxes. In Canada, a very good model, it is simple: bill is added up, tax applied, and if it is for cash, then the final amount is rounded down or up to nearest 5 or 10 cent mark depending on the amount.

No problem balancing books to the cent: Customer pays cash amount which goes on the merchant's books to the cent paid. Merchant pays tax amount which is deducted on merchant's books to the cent paid. Easy peasy. Customer is happy since it evens out soon enough. Merchant is happy because cash received evens out soon enough. Both are happy not having to count and carry pennies.

It all evens out in the long run (not many transactions, say 10, gets close).

[bucolic_frolic]

114. Do Canadian pennies still circulate?

Are they worth anything more than a penny as collectible value? Or did they just go underground as irrelevant?

[Bernardo de La Paz]

115. Nope. Nobody gives or takes pennies, esp not underground. Most were redeemed at banks. . . .nt

[BadgerKid]

103. Now it will be Take A Nickel, Give A Nickel at checkout.

[twodogsbarking]

107. They say it costs four cents to make each penny. Why not just offer everyone two cents for every penny they turn in.

I know it sounds absurd but they would get many years of penny supplies, and not have to make pennies. People have them.

[cabotnn22]

108. Good

Canada got rid of them years ago; we're fine.

[mdbl]

109. I am selling pennies for 2 cents each

checks only. Any takers

[no_hypocrisy]

134. Will we then have to "surrender" our pennies because they won't

be recognized as currency? Or will they be phased out incrementally?

[DetroitLegalBeagle]

135. Will very likely remain legal tender

Just no longer made, so the number of pennies in circulation will drop. Likely very quickly as most people don't carry pennies any further then from when they get them back to their home and from their home to their bank or Coinstar machine.

[Paladin]

138. Massive cash contributions from copper-mining firms to trump in 10, 9, 8, 7... (nt)

[EndlessWire]

159. My guess is

that rump will stop the penny, then declare it necessary, and replace it with a coin with his face on it. Not copper colored, but gold. Anything to get his face on our money.