ABC News’ Jonathan Karl and Robin Gradison report:
These days a penny made is a penny wasted.
Thanks primarily to rising costs of zinc – the main material in a penny – the U.S. Mint now spends 2.4 cents to make a penny.
Just last year, the U.S. mint made 4.9 billion pennies. It doesn’t add up: That’s $118 million to make just $49 million worth of pennies.
No wonder Canadian government announced this week that they doing away with the Canadian penny.
But here in America, the penny doesn’t seem to be going anywhere.
It’s not that powerful people have tried to nix the penny.
Treasury Secretary Hank Paulson tried to eliminate it in 2008.
The current Treasury Secretary, Timothy Geithner told Congress earlier this week that something has to be done about the sky-rocketing costs of making U.S. coins. And it’s not just the penny: the lowly nickel costs 11.18 cents to make.
“Currently, the costs of making the penny and the nickel are more than twice the face value of each of those coins,” Geithner said in his remarks.
By comparison, the dime (which costs 5.65 cents to mint) and the quarter (11.14 cents) are relative bargains.
The U.S. Mint, at the request of Congress, will soon make recommendations on reducing the cost of making coins.
The penny may not buy much anymore, but it has some mighty defenders.
First and foremost, there’s a interest group called Americans for Common Cents. They are argue that the penny has special place in American history, that losing it would cost prices to go up and even that charities that collect pennies at the cash register would lose money.
Losing the penny would also hurt the company that funds Americans for Common Cents in business: Jarden Zinc Products, that sells zinc to the mint. Copper plated pennies are 97.5 percent zinc and only 2.5 percent copper.
Jarden is the sole supplier of the zinc the U.S. Mint uses to make the penny. And the Mint tells ABC News that Jarden was paid $27.4 million in 2010 for zinc to make pennies. Last year, due to rising prices, Jarden was paid $52.2 million by the mint.
Mark Weller, the executive director of Americans for Common Cents, said the coin enjoyed high public support and that “Congress and the Administration will likely wait for the Mint recommendations, especially in an election year when the public is sensitive to price issues. Under our fragile economic climate, the last thing Congress should do is increase inflationary pressure.”
But perhaps the pennies most influential defender is the legacy of Abe Lincoln, who has been on the penny for more than a century. The guardians of Lincoln’s legacy will defend the Lincoln penny down to the last cent.
As the Lincoln Library told ABC News, “the penny is a common coin available to all people, just as Abraham Lincoln was a common man whose legacy touches all Americans. The Lincoln penny has been with us for more than 100 years and its continued place in our pockets and hearts will remind us of his great gifts to the nation – union, equality and freedom.”