Penny Wise


Congress has taken Herculean steps to protect the dollar, but I'd like to say a few words in defense of the penny.

It seems that in the midst of the nation's financial troubles there are some who believe being "penny wise" doesn't apply to pennies themselves. Editorial writers at the Los Angeles Times and Chicago Tribune believe pennies should be eliminated - a view shared by none other than Treasury Secretary Henry Paulson.

Due to the soaring price of zinc, the primary metal in modern pennies, the U.S. loses about $54 million a year making one-cent coins. That's why it's illegal to melt down pennies.

"The cent has outlived its usefulness," stated the Times. "Think of the penny as an old habit that doesn't work for us anymore."

Tell that to Ed Knowles of Flomation, Ala., who years ago began tossing his pennies in jars, and when those overflowed switched to oil drums. When he finally took the pennies - all 4.5 tons of them - over to the Escambia County Bank, he found he had saved $10,480 (and 13 cents).

Or, you could debate the penny controversy with residents of Fort Scott, Kan., who last summer decided to raise money for a park renovation project by laying 10 tons of pennies end-to-end. The resulting chain, over 40 miles long, set a Guinness record.

Those who pooh-pooh pennies make a big deal of the fact that nothing costs a penny anymore. Indeed, when visiting Massachusetts, "Good Morning America" hosts Diane Sawyer and Robin Roberts expressed dismay that "penny candy" was being sold at Williams & Sons Country Store in Stockbridge for a dime!

But there are some compelling arguments for holding on to the Lincoln penny, first minted in 1909 as a replacement for the Indian head penny.

If the U.S. eliminated the one-cent coin, merchants would round up prices (you don't think they'd round down, do you?). By one estimate, that process alone would cost consumers about $100 million a year. Then, too, many charities would lose out on pennies that are collected at schools and retail stores. Americans seem more willing to hand over pennies to a good cause than to part with "real money."

Many of us have a nostalgic soft spot for pennies. When I was seven, my parents gave me a blue cardboard folder to collect pennies by year. I loved digging through whatever coins I could find - under the sofa or in my father's trousers - in search of pennies to fill my book.

As a teen I would bike to where the railroad came through town and carefully place a penny on the track. Then I'd wait, heart racing in anticipation, for a train to come by. If hit just right the penny would be squished to triple its size, creating a souvenir no longer usable in stores but quite valuable as proof of how close one had been to a speeding train.

I remember the odd habit some of our neighbors had each Halloween of distributing apples, each with a dozen or so pennies wedged inside. It left the coins sticky and wet, and pretty much spoiled a perfectly good apple, but it was exciting to receive.

To this day, no one in my family walks past a penny on the ground without stopping to pick it up. It's fiscal responsibility in its smallest measure. It's a good feeling. And it's good luck, right?

In February the first of four newly designed pennies will be issued to mark the 200th anniversary of Abe Lincoln's birth, so the little coin that could seems safe for a while.

Government is wise to resist efforts to dump the penny. But that's not to say when conducting the nation's business it still wouldn't hurt to pinch a few.

© Peter Funt. This column first appeared in The Monterey Herald.

Index of Previous Columns