Chump change

So much of what Trump has done in the scant few weeks he's been in office has been malign, cruel, nonsensical, ridiculous, illegal, corrupt, vengeful, or moronic, it's easy for something that may make sense to slip through the cracks in our consciousness. And that something that may make sense is his decision? threat? musing? to discontinue the production of the penny.

Seriously, just what is a penny good for?

Squirrel Nuts, Mary Janes, and other "penny" candies usually cost at least a dime these days. Gumball machines take a quarter. And do even the frattiest of Ol' Miss frat boys still put pennies in their penny loafers?

Not to mention: when was the last time you stooped down to pick up a stray penny just lying there on the sidewalk? I don't think I'd even bother retrieving a nickel, maybe not even a dime. A penny? Let a rat scurry away with it.

Pennies are expensive. It costs three cents to make something worth one cent, which sounds like a big 'duh' to me, especially when you consider that most pennies aren't actually in use. They're in change buckets. They're under couch cushions. They're underneath a slit in the lining of an old pocketbook. They're in coin collections. They're on the sidewalk, because no one bothers to pick them up.

Even when I was a kid, back in the bygone era when a penny could actually buy you a Squirrel Nut or a gumball, pennies were considered pretty useless.

Remember the jingle "old lady witch, fell in a ditch, found a penny and thought she was rich?" Even when we were chanting that little ditty, we knew a penny was nigh unto worthless.

Nowadays, they're only good for leaving in the penny bowl next to the cash register at the little corner store that still takes cash. Even there, I've noted the some folks are dropping in nickels and dimes, even quarters. Even cash carriers, it seems, don't want change weighing them down.

The value to hanging onto pennies is largely sentimental, I'm afraid. 

There are, of course, some folks who don't want to see the penny go the way of the buggy whip. Most of those folks are somehow involved in the penny industry supply chain. And they want to see the penny stay alive because the manufacture of the lowly penny is their business. And while the industry may not employ all that many people, a job's a job. And if yours is going the way of the buggy whip, it's a big deal.

Here's the who's who/what's what of the penny industry:

For decades, just one company has been responsible for producing the zinc-based metal disks that become pennies: Artazn, which is headquartered in Greene County, Tenn.

The zinc used for the pennies comes from a processing plant in Mooresboro, N.C.; a transportation network takes the zinc from there to Tennessee, and then onward to US Mint locations in Denver and Philadelphia, which finally mint the unmarked discs into legal tender. (Source: Boston Globe)

And together they produced 3.2 BILLION pennies last year. (Which may sound like a lot, but it's fewer than ten per U.S. capita.)

The industry, though small, has a lobbying group - Americans for Common Cents - which is largely funded by Artazn (which is owned by a PE firm, btw). And Americans for Common Cents aren't taking Trump's recent decision? threat? musing? lying down.

...propenny interests are mounting a campaign to persuade the president, the public, and relevant lawmakers that the coin is worth keeping.

They argue it would ultimately cost the government more in the long run to stop producing the coin, and that there could be an inflationary impact in prices being rounded to the nickel and not the penny.

I'm trying to figure out how the penny industry can afford a lobbying effort. If a penny costs three cents to produce, then it only costs $9.6 million to produce 3.2 billion of them. Hmmm. That looks like spare change to me, so keeping this business alive hardly seems worth the efforts. Unless, of course, you're one of the 250 workers at Artazn, and those at the Tennessee zinc plant and the Mint locations. But the workers aren't doing the lobbying, the industry owners are. And since when does private equity give a plug nickel whether 250 lowly workers lose their jobs?

Make it make cents sense!

Beyond the job-preservation argument, which seem a bit lame, there's the "it will increase inflation" argument, which also seems somewhat specious. Sure, prices will go up marginally, as retail rounding is only going to go in one direction. But I'm thinking that's nothing compared other infaltionary factors, including the price gouging strategies in play. (Think of the weight/volume reduction but keep the package the same size tactics the food industry has been using for years.)

Another propenny point is that, if the penny is done away with, more nickels will be produced. And if you think the penny is a loser, the nickel also costs almost three times its value to produce. So if the penny costs the government two cents each time one gets minted, a nickel costs it nine cents, making the "losses greater in the aggregate." So the penny lobby thinks that the government should train their sights on nickel reform. (The nickel industry doesn't have a lobby.)

Pennies? Nickels? Pretty much chump change, anyway, in terms of overall federal expenditures. But when it comes to government inefficiencies and waste of money, it seems like a better place to start than, say, letting perishable food stuffs rot on the docks rather than free them up to keep children in Sudan from starving to death. But what do I know.

My hunch is that, given the job losses would be in red states, Trump and the DOGE bros can probably be prevailed upon to leave the pennies alone and focus on governmental groups that have had the temerity in the past to investigate anything to do with Trump, Musk, and their billionaire buds.

Sigh...