The New York Times tells us:
The penny may seem like a harmless coin.
But few things symbolize our national dysfunction more than the inability to stop minting this worthless currency.
Given that this is the NYT we know it’s wrong. Our task is only to work out why it’s wrong.
The truth of the wrongness is in this very opening paragraph:
I was disappointed to learn, recently, that the United States has created for itself a logistical problem so stupendously stupid, one cannot help wondering if it is wise to continue to allow this nation to supervise the design of its own holiday postage stamps, let alone preside over the administration of an extensive Interstate highway system or nuclear arsenal. It’s the dumbest thing I ever heard. I have come to think of it as the Perpetual Penny Paradox.
Yep, the penny is - and this is true of the English penny, the eurocent and all the rest - evidence of the gross dysfunction of government. But not actually in the way that Ms. Weaver thinks.
Lots of pennies are minted, few are used, that’s her complaint.
One thing we know for sure about America’s 1-cent coins, however, is that just one of them costs more than 3 cents to produce.
This is true, something I addressed here.
Eleven years ago, President Barack Obama called the penny “a good metaphor for some of the larger problems” of the U.S. government.
That’s also true and a reason we must keep them.
Steve Stivers, a congressman from Ohio’s 15th District, led multiple unsuccessful attempts to revise coinage laws while serving in the House from 2011 to 2021. (He hoped to enjoin the Mint to make pennies out of cold-rolled American steel, something they happen to produce a lot of in Ohio.) Stivers attributed his bills’ failures to “a reluctance to change, and this idea that we had to study every little thing before they would even think about a change.” He was particularly irked that a Mint-commissioned study on alternative cent compositions concluded, in part, that there would be no major savings if pennies were minted from stainless steel. “We weren’t proposing stainless steel, for God’s sake!” Stivers exclaimed from his office in Columbus. (He is now the president of the Ohio Chamber of Commerce.) “Stainless steel is a lot more expensive!”
Well, yes, but the reason the US didn’t move to steel coated with copper - unlike the EU and UK - is the presence of Big Zinc in the US political system. As I pointed out here. Or rather, Big Zinc Blanks.
Nearly every former federal official I interviewed about America’s interminable penny production pointed a finger at a small private company in Greeneville, Tenn., called Artazn. For 43 years, Artazn has held contracts with the Treasury Department to manufacture the zinc “blanks” that the Mint stamps into 1-cent coins. These contracts have earned it more than $1 billion in revenue since 2008 alone.
Quite so, the NYT only 9 years behind me.
According to the government transparency group OpenSecrets.org, since 2006 the company has spent less than $3 million — a charmingly modest amount — on coin-related lobbying.
Indeed so, as I’ve pointed out people bribe politicians because politicians are cheap.
There is one use for US pennies - the IRS has to take them as a tax payment. Unsorted, unbagged, in any quantity - this is not true of HMRC. So, wheelbarrows full and pay your taxes. Tho’ there has been some muttering from in the know IRS types that really doing this might well increase your chances of being audited. Despite that being illegal, it could be true. Being audited is not supposed to be a result of pissing off IRS agents.
But still, even so, we must retain the penny. Partly so that we all get slapped in the face with that $3 million in political spending gains $1 billion in contracts. We must never, ever, forget that politicians are real, real, cheap to buy.
But more than that, much more than that. Not that many decades back we gave politicians the power to decide what money is worth - that new age of fiat currency. Since then currency has turned to shit, it’s worth, by any historical standard, nothing. Which is why we need to retain the penny.
As a reminder. Anything we allow government to do turns to shit. And don’t you forget it.