Is President Obama gunning for the penny?

The commander in chief expresses support for getting rid of our least-valuable coin, which costs more to produce than it's worth.

By Aimee Picchi Feb 15, 2013 1:57PM

Image: Pennies ( Corbis)If President Barack Obama has any say in it, the United States is going to lose its cents. 


The subject came up during a Google+ hangout with Obama that was advertised as a "fireside" chat, reminiscent of FDR's famous radio addresses.


One participant asked the president why the U.S. hasn't yet phased out the coin, according to Business Insider.


"I gotta tell you, John, I don't know," Obama replied. "Any time we're spending more money on something that people don't actually use, that's an example of something we should change."


If the U.S. dumps the penny, it would be following its neighbor to the north. The Royal Canadian Mint earlier this month halted distribution of the pennies to banks and other financial institutions, with the goal of eventually phasing out the tiny coin from distribution. The reason? The penny costs Canada 1.6 pennies to make, turning it into a money-losing proposition.


The situation is similar for the U.S., where in 2011 it cost the country 2.4 cents to manufacture each coin. According to a group called the Citizens to Retire the U.S. Penny, the country spent almost $120 million in 2011 to produce $50 million worth of coins. 


Dropping the penny would produce savings, but overall the amount would be tiny compared with the government's $3.5 trillion in annual spending. 


That hasn't escaped Obama's attention. 


"This is not going to be a huge savings for government," he noted on the Google+ hangout. 


Of course, the penny's fate isn't up to Obama. The U.S. Mint, which makes the coins, is a federal agency, and getting rid of the coin would take an act of Congress.


Obama seems to realize that getting rid of the coin wouldn't be easy. 


"One of the things you see chronically in government, it's very hard to get rid of things that don't work so then we can invest in the things that do," he said, according to Business Insider. "So the penny becomes a good metaphor for a lot of the problems that we've got."


More on moneyNOW

468Comments
Feb 15, 2013 3:36PM
avatar
THIS ARTICL SHOW HOW HATEFUL THIS COUNTRY HAS BECOME THIS ARTICLE IS ABOUT COMMEN SENSE AND SAVIN MONEY FOR THE TAXPAYES THE PREZ HAS NOTHING TO DO WITH THIS BUT YOU THOUGH THAT THIS COUNTRY SHOULD HAVE A WHITE MALE FOR PREZ FOREVER 1950 FIFTY IS NOT COMIN BACK DEAL WITH THT
Feb 15, 2013 3:36PM
avatar
i have to believe that there are enough pennies running around that we don't need to make 5,000,000,000 new pennies each year- typical government spending. who doesnt have a jar or box or cup full of pennies at home?
Feb 15, 2013 3:36PM
avatar
Obama is clueless, I agree. By dumping the penny it opens up a space for another coin in the cash drawer. I suggest, dump the penny, add the one dollar coin, dump the one dollar bill. 
Feb 15, 2013 3:35PM
avatar

Here's a thought, if you're thinking seriously. I make $110,100 in 2012. I paid roughly $4642 in Federal Social Security taxes and the company paid more. The CEO of our company made 12.1 million. He pays the identical amount of Socila Security taxes I did. The corporation paid the exact same amount for each of us into Social Security. Our Medicare contributions were different, but with his company perks, he's never going to pay a nickel at a hospital for the rest of his life.

 

So why not make the top 2% pay their fair share. I'm not talking taxing them extra. I'm not talkig about going after their stock dividends or the money left to them by their parents or the money they're leaving to their kids. I'm just talking about the salary they make. Make them pay the same percentage into social security I do. No cutoff at $110,100. Company matching is increased also. Keep the maximum payout at it is now. If people with no kids have to pay school taxes, then people who'll never need social security or medicare should pay in to keep the system solvent.

 

 

Feb 15, 2013 3:34PM
avatar
If your looking for Congress to act on anything that Obama thinks mite make sense, then you may also think cows can fly!
Feb 15, 2013 3:34PM
avatar
The hell with cutting the penny.  Do something about the price of gas!!  We just went to $3.85 a gallon today in central Ohio in the middle of winter and during the weakest demand time of the year.  Hey Obama...you want to save the people lots of money?  Change your policies on the pipeline, gulf drilling and get oil off the commodity market and out of the hands of speculators and gas should come back down below $3 a gallon.
Feb 15, 2013 3:33PM
avatar

@musicianman this is just one of the many issues they're dealing with to cut spending msn decided just to post this up that's all. They have to cut spending before the dollar falls which could have happened in 09 you dont see that on american news.

Feb 15, 2013 3:33PM
avatar
Finally, something i can agree with this guy on.
Feb 15, 2013 3:31PM
avatar
I know it costs taxpayers 2.4 cents to make.  However, since we are all taxpayers and retail purchasers, wouldn't eliminating the penny cost us more since retailers surely wouldn't round DOWN to the nearest nickel, would they?   For example, if something costs $.59, at a 6% sales tax rate you would pay $.63.  If rounded to the nearst nickel, you are already up that $.02.  Hence, the base price of your item is now $.61.  Multiply this by the bazillion transactions a year that we collectively make, it is still going to cost us.  Maybe it instanly makes the accounting at retailers that much easier to adjust for the round-off?  Wouldn't everything have to be based on a cash transaction denominator even though most of us probably use a credit/debit card andyway?  Am I way off base? 
Feb 15, 2013 3:31PM
avatar
Something I consider far more important than the penny is the way the government allows the dollar to float skyward, The only thing backing up the mighty dollar is our faith in the government. If the federal reserve keeping printing more money it only devalues what we do have. Dang it, pretty soon bread will be $100.00 a loaf.
Feb 15, 2013 3:31PM
avatar
I agree - things that don't work - like Obama himself - VERY hard to get rid of.
Feb 15, 2013 3:30PM
avatar
SOMEONE IT JUST GOES TO SHOW YOU HOW YOU ARE VERY SICK AND HATEFUL.
Feb 15, 2013 3:29PM
avatar

"'One of the things you see chronically in government, it's very hard to get rid of things that don't work so then we can invest in the things that do,' he said, according to Business Insider."

 

I guess that explains how he got re-elected...

Feb 15, 2013 3:29PM
avatar
A really tough issue......It's laughable.............Such an inept and incompetent man. I'm surprised he doesn't want his face on the penny. Actaully appropriate since that is just about what this man is worth....if that.......
Feb 15, 2013 3:27PM
Feb 15, 2013 3:26PM
avatar
it's easy to be fair, total ends in 1 or 2, 6, or 7 you keep the extra nickle. if it ends in 3,4,8,or 9 you pay the extra nickle it should balance out pretty even.........it's called give in take.
Feb 15, 2013 3:26PM
avatar
if banks would bring back the old fashion coin changer machines (like they have in vegas) and NOT CHARGE ME FOR IT!!!  i would return a LOT of pennies and nickles and dimes into circulation!
Feb 15, 2013 3:24PM
avatar
(The commander in chief expresses support for getting rid of our smallest coin, which costs more to produce than it's worth.)


I think the same argument can easily be made about Obama's worth to the nation!

Feb 15, 2013 3:24PM
avatar
We don't have to get rid of the penny, we just don't need to mint any more new coins.  Geez, there's probably billions of them in circulation now.
Feb 15, 2013 3:23PM
avatar
If $120 million is not much of a savings, why is the IRS so worked up over my measly few thousand dollars of income tax.
Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

Trending NOW

What’s this?

MARKET UPDATE

[BRIEFING.COM] The stock market finished an upbeat week on a mixed note. The S&P 500 shed less than a point, ending the week higher by 1.3%, while the Dow Jones Industrial Average (+0.1%) cemented a 1.7% advance for the week. High-beta names underperformed, which weighed on the Nasdaq Composite (-0.3%) and the Russell 2000 (-1.3%).

Equity indices displayed strength in the early going with the S&P 500 tagging the 2,019 level during the opening 30 minutes of the action. However, ... More

MSN MONEY'S