Getting rid of Lincoln and the Maple Leaf?

In Canada, there is a fair amount of American coinage in circulation. No Canadian retailer would refuse payment that includes American coinage. Of course no exchange is ever given on coin.

When you work in retail and come in contact with a great deal of coinage, you can kind of supplement your income by fishing out American coins, tossing in Canadian coins, and eventually collecting enough American coinage that you can roll the coin. Banks won't give exchange on loose coins but if you have an American funds bank account at your Canadian bank, the bank will accept rolled American coin same as American paper bills.

So you deposit your rolled American coin into your American funds bank account, convert it into Canadian, and live like a king off the favorable exchange rate.

Working at a self serve gas station back in my university days in a border town (Windsor, Ontario), I figure I'd collect maybe $50 a year in American coin (which might translate into about $60-$65 Canadian).

Alright you weren't exactly supplementing your income to a great extent, but when you're working a minimum wage job, you're a student, and you're working only a couple nights a week, a $15 "bonus" at the end of the year would keep you in Whopper combos for a couple weeks, easy.

My only other American coinage anecdote is what I thought was a pretty clever joke my grandmother told me years and years ago. She gave me an American penny, head side up. She said "Can you see a car on the front side of this coin?"

I stared at it for some time and could see no car. "Nope, Grandma."

"She pointed to Abe's head. Right there. A Lincoln."

But wait. There's more.

She flipped the coin over to the tails side. "Can you find a naked woman on this side of the coin?"

So yoked, I began to look for anything on the tails side that might have some kind of naked woman pun. But, I could make no connection.

"Nope, Grandma. No naked woman."

"Well, what do you expect for a penny?"

I dunno. I still think it's a pretty funny joke. Try it some time.

Yeah, what do you expect for a penny these days?

Well, you can buy a used copy of Prelude to Foundation for a penny on Amazon.com. You can buy a lot of used books (usually paperbacks that have been in print for nearly as long as the full run of the Seldon Plan) on Amazon.com for a penny. Of course, it will cost you more than a penny with shipping and handling at checkout time. And that's pretty much why you can buy a book for a penny on Amazon.com. Amazon gives the seller a rather generous S&H fee. The retailer makes a profit on the difference between the Amazon fee and the book rate postage the US Postal System charges. Those familiar with the glory that is the US Postal system (and I use glory without sarcasm¹), know that the US Postal system has a cheaper book or media rate as compared to first class postage. Back when I lived in Seattle and I was unloading books, there was about a 25 cent difference (in your favor, and yes the cheap Canadian in me does happen to think 25 cents American is a generous fee) between the US Post Office's media rate and the Amazon S&H fee. The extra was meant to pay for the "handling" portion. You know, the tape, the envelope, the address label. The casual seller can abuse his/her work's office supply room and acquire mailing supplies for free. And trust me, did I ever abuse it.

The penny, other than being an instrument by which one can charge the least amount of money possible, sure doesn't seem to have much actual utility. I'm not aware of any coin operated machines that take pennies today. Even those theme park machines that squish down your penny require substantially more than a penny. And I'm given to understand you can't even experience the joys of thrill killing by heaving a penny off the top of the Empire State Building.

And although people will swear up 'n' down a penny had some real value at some point in their living memory, I can't even remember any machine that took them in the 1990s ,the 1980s, or the 1970s, even.

In Korea (yeah, that place again), the equivalent of the penny is the 10 won coin. That's their coin with the lowest face value that's still in circulation. It's pretty much like a penny in purchasing power.

One of my students once had several one won coins (remember it takes about 1000+ wons to buy a single US dollar). I offered her 200 won for her 1 won coin, a deal in her eyes. Not only was it a 200x profit but outside my school, middle aged women (ajummas) behind street food carts always sold children sized portions of whatever they were selling for 200 won. 200 won represented dinner to my student. (For some reason Korean parents always sent their kids to night school hungry, preferring to serve dinner when they got home about 10 pm. I suspect it was a "stick" approach. If the kid brought home a test with a failing grade, he/she wouldn't get dinner that night.)

The 10 won coin was, for a long time, a goodly sized coin. It felt like real money. It was a bit smaller than an American quarter. Even though it had about nil purchasing power alone, subway ticket machines accepted the coins. I would save up a bunch of 10 won coins and then use them to buy a 900 won subway fare. The ticket machines unfortunately had a time out function. You couldn't spend all day just feeding coins into the machine. So it was always a bit of a race to see if you could drop 90 coins into the ticket machine before it got bored.

Another coin-operated machine that would take 10 won coins was the coffee machine. You'd see these things all over Korea. For about 200 won, you'd get a little Dixie cup of super sweet instant coffee. Believe it or not, you eventually do develop a taste for the weird super sweet "coffee" these machines ooze out. So your 10 won coins were useful there. I also discovered an interesting feature of these machines. If you put twenty 10 won coins in the machine and then pressed the coin return button, you got two 100 won coins back. I was cautioned, however, to avoid using these machines like omnipresent, feeless Coinstar machines as most machines were part of very, very small "routes" owned by old Korean men as their retirement project (as in, Korea has no government old age pension system and the meager earnings from these coffee machines was what probably kept a roof over the head of an old man and his wife). In other words, don't force some 75-year-old man to take a sack of 10 won coins to the bank.

In my last year in Korea, the sizeable 10 won coins, which seemed to be made of increasingly valuable industrial metals like copper, were replaced by smaller penny sized 10 won coins made of a metal so light you could float the suckers on water. Naturally, no merchant was tripping over themselves to re-jig their machines to accept the new 10 won coin.

So, I guess I got out of Korea just in time.

Back on this side of the Pacific, on both sides of the Rio Detroit and 49th Parallel, there are perennial calls to eliminate the penny. Such calls always reach a crescendo when a penny's "melt value" gets near or exceeds its face value. If you're ever curious about a coin's melt value (that is if you just melted the coin down and made ingots out of the constituent metals, what could you get for the metal on the open market), you can check here for the current melt value of American coinage.

As of this writing, 1 Abe will get you roughly 1/3 of a cent.

Melt value alone doesn't represent the true cost of making a penny. It takes labor and energy to make coins and distribute them. In March 2008, a member of Canadian Parliament introduced a private members bill to eliminate the Canadian penny. He claimed it was costing about four times a penny's face value to make the penny (although apparently the Canadian mint claims it's only 70% of face values). Private members bills rarely get past first reading (in Canada it's considered in very very very poor taste for our elected politicians to think for themselves) and I'm sure this one died. I'm still rolling pennies. (When I get 14 rolls of pennies, I bring them to the bank, get $7, and then go buy myself two slices of pizza at the local pizza takeout.)

In the USA, according to wiki, bills to eliminate the penny have been introduced twice in this millennium and failed.

Examining that wiki page, the arguments for keeping the penny seem amazingly lame with maybe the exception a great president will no longer be honored on currency.

One of the funnier arguments I heard in Canada for keeping the penny was in a letter to the editor of my local paper. A writer reasoned that gas keeps going up by a penny or two a liter. If there were no more pennies, gas would be going up in nickels per liter. I guess he failed to notice gas is priced to the 1/10th of a penny (say 80.1 cents a liter) and it also goes up (and recently down) in fractional amounts at times.

People generally do have an impression without the penny prices will priced to the nickel amount (hell, I'm for the elimination of prices like $14.99) and I guess retailers will jack up prices by 1-4 cents to take advantage. They just generally fail to understand that prices won't theoretically change. Just the final bill will be rounded up or down to the nearest nickel. So if your bill is $14.03, you pay $14.05. If your bill is $14.02, you pay $14.

I can possibly see merchants that do millions of dollars in sales every day employing a team of math grads to re-price items so the majority of purchase combinations always result in a round up in the merchant's favor.

I guess a lot of cash registers would have to be reprogrammed and there would be a cost to merchants.

I can also see a sport where people are pumping gas and trying to pump $35.02.

Oh yeah, Australia got rid of their penny in 1992. They did okay. Although I'm sure the public's respect for the Feathertail Glider dropped off precipitously.

-- Karl Mamer

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¹Americans, I know you're quick to make fun of government institutions like the post office but try living in Canada for a spell and using the Canadian postal system and then tell me your post office is all that bad. Canada has no media rate. And Canada post is slow. In Seattle, I could get a book from Seattle to New York in about 2 days. In Canada, trying to get anything even to the city next door is about 3 days which is just a polite way of saying "3 days plus sometime into the next week". Oh yeah, we don't have postal service on Saturday. Maybe this has been cut in recent years in the USA but it was really nice to get mail on a Saturday. And then the USA had all those other good rates on Christmas cards and postcards. Granted I don't take my life into my own hands going into a post office in Canada but frankly the risk is small and worth it.