CGP Gray is in rare form in this 4 1/2 minute argument in favor of phasing out the penny. He argues, entertainingly, that:
…they cost more to make than they’re worth, they waste peoples’ time, they don’t work as money, and because of inflation they’re less valuable every year making all the other problems worse.
See what you think:
Also from CGP Gray:
- What the Bleep is the United Kingdom?!
- The Economics of Royalty
- The Social Construction of the Continents
- A History and Account of Daylight Savings
Comments 41
Kieron George — May 5, 2012
What the heck! GREY!
Legolewdite — May 5, 2012
This seems staggerly uncontroversial. So maybe a few decades we'll ditch the penny (and start paying people a dime per thought? ah, either way...)
Liked this, reminded me a bit of the NPR piece a couple weeks back on possibly getting rid of the dollar - http://www.npr.org/blogs/money/2012/04/19/150976150/should-we-kill-the-dollar-bill
Bravolover — May 5, 2012
I've found that it is harder to use the penny which is why I found myself using it less over the years. Vending machines won't take them and people give you dirty looks when you use them in stores. I mostly pay with plastic these days so it's not an issue for me anymore, but I am a bit sad about the potential loss of the penny. Then again, as far as I can see the decision has already been made for me.
Spekatie — May 5, 2012
Here in Canada, we just passed a motion eliminating pennies. I'm curious to see how it will pan out in the next few years!
Steven Alan Taylor — May 5, 2012
Once the penny is phased out, inflation will soon make the nickel unviable as well. It also leaves a troubling rounding scheme. I propose that, if we are to give up culturally signficant denominations of cash for inflation purposes, we phase out the hundredth's place of currency entirely. Simply truncate all values on a certain day to only **.*. Dimes are useful suddenly, and quarters are reformed to .2 value.
Until inflation and mineral resource crises finally force us to credit cards for all purchases or giving up coinage entirely.
Gilberjen — May 5, 2012
Actually, in New Zealand we gave up the 1c decades ago, and recently gave up the 5c, with the 10c as our smallest denomonation. We round to the nearest 10, using Sweedish rounding (1,2,3,4,5 rounded down to 0 and 6,7,8,9 rounded up to 10.) No one complains and it hasn't effected our economy. Most people use Eftpos (debit cards) to buy things here anyway, so you get charged the exact amount with that, so most spending is not effective. Plus our wallets are so much lighter :)
On another note.... in the US, the shelf price doesn't match the actual price you pay....? What?
ctl — May 5, 2012
(retracted, oops.)
ctl — May 5, 2012
*affected. Chain correction!
Conuly — May 5, 2012
Alternatively, we could readjust our money. Introduce a "New Dollar" that's worth ten "Old Dollars" and make the New Pennies worth 10 Old Pennies and so on. That'll only last until inflation catches up again, but it'd be fun to buy bread for a quarter for a little while.
JonCarter — May 6, 2012
Making Pennies: A Typical Government Program.
Village Idiot — May 6, 2012
I'm for getting rid of pennies and dollar bills, introducing a new dollar coin and reissuing $500 and $1000 bills on a large scale to make a cash-based lifestyle more viable.
Part of the reason for using banks and checks and credit cards was that they were supposed to help keep us from losing all our money if we were mugged or if someone stole it out from under our mattress but nowadays thanks to identity theft and fraud we can just as easily get all our money drained from our accounts electronically and our credit ruined for years, so the security advantage of banks and carrying plastic instead of cash has been substantially reduced.
seanpodge — May 6, 2012
One flaw in his argument I think is when he claims that a one cent coin costs 1.8 cents to make. This argument appears to suggest that the one cent coin is a single use item rather that something that can be used over and over again, thereby spreading out the manufacturing costs over the repeated uses of the coin. It's a bit like claiming that buying steel cutlery is a waste of money because plastic cutlery is cheaper.
diamonddame — May 7, 2012
there are so many questions I'd like to ask.. but I'm actually kind of afraid of the condescending remarks I'm sure to get by not being 100% knowledgeable on this. ;/
Guest — May 7, 2012
Actually, the argument that a penny "costs more than its worth" is slightly shortsighted. I believe the statistic is that a penny costs 1.8 cents to make. Let's say it's used to pay for something 2 times. Its cumulative worth is already more than its cost.
When a penny is minted, you are not making something with a value of one cent. You are making something that represents "the value of one cent", which can be used hundreds of thousands of times over its decades-long lifespan.
That being said, I think we should phase it out. Its only purpose really is to increment sales tax, and you just can't buy anything with it.
RubyRoyal — December 21, 2012
What is this shit? Is this really what you idiots waste your time on?!