Ever bought something for $99.99? Maybe you have, maybe haven’t. I don’t know. But if you have, then you have probably have handed over a $100, Benjamin Franklin, and you were supposed to receive one penny, Abraham Lincoln. One penny makes everyone like “meh.” So most of the time, people don’t get their pennies, and interestingly it turns out the right decision when we are economically speaking.
In 2012 one penny cost two cents to make. A nickel, Thomas Jefferson, cost 10 cents to make. Those costs were less than they were in 2011. It was such a massive problem because it requires the US government about a hundred million dollars to make 5.8 billion pennies and 1 billion nickels. Even Obama himself wanted to try and find some way to reduce their cost.
The interesting thing here is changing its metallic structure will not reduce its cost. 17% of the cost of making a penny or nickel is an administrative cost. But that is not precisely bad because an administrative expense is a labor charge and people get paid for their work. That payment is going to be pumped back into the economy at the end of the day.
This issue has been a problem in different countries at different times. In World War II, soldiers thought that using copper pennies as bullets was better than spending it. In 2013 Canada already got rid of its penny.
However, I still have not proved that a penny is not worth a penny. We know that money doesn’t get used just once. It goes into circulation. For instance, if you go to a market, find something that you can buy with a penny, which is a challenging thing to do, and give your penny to whoever is selling the thing that you purchased. Then, that guy is going to give that penny to someone else, and then it will be going to someone else. Thus a penny is used more than once. So we may say it covers its cost.
If you find a $100 bill in the street, you scream, but do you cry when you find a penny in the street? When you lose your penny, you don’t care. You don’t even notice that you lost your penny. If you lose your $100, you go crazy.
So it seems like a penny is not worth a penny. But there are different ways to use a penny. Those ways could make the penny worth a penny. Here someone listed 83 things that you can do with a penny, including scratching off your lottery ticket, teaching your toddler how to count, playing penny poker, or even filling a sock with a lot of pennies and then using it as a self-defense weapon.
Ok, but why did someone make a list such that? What exactly is the value in that? All of those useless activities will have some hidden benefits to them. I don’t know what the 300 million people in the United States using pennies to open up their remote control battery compartments, but is it really worth the amount of money spent by the government in making them?
To summarize, the answer to the question is a penny worth a penny, can be answered through the following ways:
- If you look at it from an economic perspective, the answer is 100% no. It is not worth the trouble.
- If you look at it from a social perspective, then maybe it is worth the trouble.
- If you look at it from an overall perspective, I think that something is going to be based on opinion.
Anyway, the penny is still somewhat worth it, but eventually, it is going to exceed the economic cost, and it’s also going to exceed the social cost. So at that point, the US government eventually is going to get rid of it.