A few years ago, I spotted a wheat penny in the pile of change that the old-timer behind the counter at Tweedy & Popp Ace Hardware store in Wallingford handed me. I immediately flipped it over and was amazed by the date.
“Did you know you just gave me a 1918 penny?” I asked.
“It’s probably been in the drawer since then,” deadpanned the teenager next to the old-timer.
I went home and added it to the collection of old and unusual coins I’ve gathered over the years, most of which I’ve received as change from unsuspecting cashiers.
It was my grandfather who taught me when I was a boy to keep my eye out for wheat pennies, buffalo nickels, bicentennial quarters and Susan B. Anthony silver dollars. These days, my lucky coin finds are few and far between, primarily because I use a debit card to pay for most of my purchases.
I’m not the only one: Two-thirds of all in-store purchases in America are now made with debit or credit cards. That fact, plus the rising cost of producing the penny, along with its decreasing value, has caused increasing calls for the United States to stop circulating the penny.
Canadian change
You may have heard that, on Feb. 4, Canada stopped circulating its penny when the Royal Canadian Mint stopped distributing them to financial institutions. Last year, Canadian Finance Minister Jim Flaherty announced that pennies were a nuisance and had outlived their purpose, and in May, Canada stopped minting them.
Canadians may still use the penny, but store owners have been instructed to round prices up or down to the nearest nickel. Electronic purchases, however, will continue to be billed to the nearest cent. The Canadian government estimates that it will save about $4 million a year.
What you may not have realized is that, since the Canadian currency model is so similar to ours, the American government will watch Canada’s reaction to the elimination of the penny very closely to see if we should do the same thing here.
In the United States, it now costs 2 cents to produce our 1-cent coin, primarily due to the increasing cost of zinc, the primary metal in pennies since 1982, when it replaced copper.
Of course, the larger problem is that the penny’s value has been decreasing for decades. According to an article in Time magazine, one hundred years ago, the penny had almost 25 times more purchasing power than it does today.
Perhaps Canadian Parliament member Pat Martin said it best when saying goodbye to the Canadian penny on Feb. 4, as quoted in a Seattle Times article: “There’s nothing a penny will buy anymore, not a gum ball or small piece of candy.… [Pennies] clutter our change purse and don’t circulate. They build up in old cookie jars under our beds and in our desk drawers. You can’t give them away. They cost more than they’re worth. It’s time to put them all out to pasture, put them out to the curb.”
Penny-ante future
One potential problem with ending the circulation of the penny in the United States is the fact that it currently costs 10 cents to produce our 5-cent nickel, due to the same increases in metal and production costs. The Royal Canadian Mint has said it will increase the number of their nickels, so would the United States save any money by eliminating pennies but increasing the production of nickels?
Experts disagree, and some advocate eliminating both coins. Fighting to keep the penny, not surprisingly, is the zinc lobby, but it might lose out anyway even if we keep the penny, because the Obama administration has proposed investigating if changing the composition of pennies again will reduce costs.
While polls show that a majority of Americans still want to keep the penny, that number is sure to drop over the next few years. It seems inevitable that the penny is destined for the same fate as newspapers, record stores and quality customer service.
Perhaps the greatest loss of the penny will be the cultural loss: “A PayPal payment for your thoughts” just doesn’t sound the same.
I wouldn’t recommend tossing your credit card in a fountain and making a wish, either. Pennies and the other coins have a physical permanence that paper bills and debit and credit cards could never have.
When I hold that 1918 wheat penny in my hand, I think about all the thousands of other hands that must have held it over the decades. Who knows? Maybe my grandfather once held the very same penny in his hand — implausible, yes, but not impossible.
Times may change, but it will always feel good to carry a little bit of the impossible around in your pocket.
MATTHEW WILEMSKI is an award-winning columnist. To comment on this column, write to QAMagNews@nwlink.com.