- The Washington Times - Monday, July 3, 2006

PLYMOUTH, Mass. — In this village settled by thrifty Pilgrims, you can still buy penny candy for a penny, but tourist Alan Ferguson doubts he’ll be able to dig any 1-cent pieces out of his pockets.

He rarely carries pennies because “they take up a lot of room for how much value they have.” Instead, like so many other Americans, he dumps his pennies into a bucket back home in Sarasota, Fla.

Pity the poor penny. It packs so little value that merry children chuck pennies into the fountain near the candy store, just to watch them splash and sink. Stray pennies turn up everywhere: in streets, cars, sofas, beaches, even landfills with the rest of the garbage.

A penny bought a loaf of bread in early America, but it’s a loafer of a coin in an age of inflation and affluence, slowly sliding into monetary obsolescence.

For the first time, the U.S. Mint has said pennies are costing more than 1 cent to make this year, thanks to higher metal prices.

“The penny is going to disappear soon unless something changes in the economics of commodities,” says Robert Hoge, an authority on North American coins at the American Numismatic Society.

That very idea of spending 1.2 cents to put 1 cent into play strikes many people as “faintly ridiculous,” says Jeff Gore, of Elkton, Md., founder of Citizens for Retiring the Penny.

But the penny carries a reassuring symbolism that Americans hesitate to forsake.

“It’s part of their past, so they want to keep it in their future,” says Dave Harper, editor of Numismatic News.

The Mint’s announcement is a milestone, though, because coins have historically cost less to produce than the face value paid by receiving banks. They are moneymakers for the government.

Rep. Jim Kolbe wants to keep it that way. But when the Arizona Republican asked Congress to phase out the penny five years ago he failed. He intends to try again this year. If he fails again, he joked recently, he may open a business melting down pennies to resell the metal.

The idea of a penniless society began to gain currency in 1989 with a bill in Congress to round off purchases to the nearest nickel. It was dropped, but the General Accounting Office, now called the Government Accountability Office, in a 1996 report unceremoniously acknowledged that some people consider the penny a “nuisance coin.”

In 2002, Gallup polling found that 58 percent of Americans stash pennies in piggy banks, jars, drawers and the like, instead of spending them like other coins. Some people eventually redeem them at banks or coin-counting machines, but 2 percent admit to just plain throwing pennies out.

“Today, it’s a joke. It’s outlived its usefulness,” says Tony Terranova, a New York coin dealer who paid $437,000 for a 1792 penny prototype in what is thought to be the denomination’s highest auction price.

They are not a joke to Edmond Knowles, of Flomaton, Ala. He hoarded pennies for nearly four decades as a hobby. He ended up with more than 1.3 million of them — 4.5 tons — in several drums in his garage. His bank refused to take them all at once, but he finally found a coin-counting company, Coinstar, that wanted the publicity.

In the biggest known penny cash-in ever, they sent an armored truck last year, loaded his pennies, and then watched helplessly as it sank into the mud in his yard. They needed a tow truck to redeem it.

“I still got a few ruts in the yard,” says Mr. Knowles.

Another problem: deciding what to make the penny from. Copper, bronze and zinc have been used, even steel in 1943 when copper was desperately needed for the World War II effort. In 1982, zinc replaced most of the penny’s copper to save money, but rising zinc prices are bedeviling the penny again.

Those who want to keep the penny coin include small merchants who prefer cash transactions, contractors who help supply pennies, and consumer advocates who fear rounding up of purchases.

“We think the penny is important as a hedge to inflation,” says director Mark Weller of Americans for Common Cents. “Any time you have more accurate pricing, consumers benefit.”

By the way, the Mint says nickels are also costing more to produce than they’re worth. Pity the poor nickel?

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