Glenn E. says:

“Their use will become largely redundant, as companies and retailers have been told to begin rounding up sums to the nearest nickel…”

We’ve known that this is possible. By virtue of product many manufacturers shrinking the standard sizes of things, rather than raising their prices, too sharply. The last straw for me, was the downsizing of toilet paper rolls, from the old 4.5″ width, to 4″ or less. And making the cardboard tube in the center, larger. Some store chains get their own custom sizes of products, so its prices seem lower than the grocery stores. So if all this product sizing manipulation is possible, to hide inflation. Then they can easily add a tiny bit product, to keep it “rounded” to the nearest nickel.

But this is NOT why America holds onto the penny. Eliminating the penny, prevents to use of the “.99” trick. The psychological mind game of hiding the true cost of things, to the average person. Because the value “9” can not easily be processed by the brain. It’s more than five fingers, but not two hands full of fingers. So we never quite conceived of it properly, since childhood. Perhaps schools were told not to teach us this. A conspiracy? Wow!

Most tend to see a “9” as a “0”. So a $1.99 item seems to only cost $1.00. Because we’d have to mentally round up the price, every time we see it. And often we can’t remember if we did this already, for something we remembered seeing. And a $0.99 priced item just doesn’t seem to cost a $1. So impulsively we’re more likely to buy it. So retaining the penny, helps retailers trick us into spending more. Because going to rounded amounts like $0.95 and $1.05, just won’t work as well.

You may have noticed that all cash winning contests are ALWAYS stated in whole dollar amounts. Because they want to make damn sure there’s no confusion about that. But retail costs of even high end purchases, are stated in the xx99.99 range. Which is about .09% less than the whole dollar value. But retailers are willing to sacrifice this, because it fools the average shopper into thinking its 9 to 50 percent less. A $1999 price tag appears more like $1k than $2k, in our brains. That’s half of what it really costs. And $10,999 appears more like $10k, than $11k. That’s 9.1 percent less, than it really costs. And $29,999 looks more like $2k than $3k. That’s a $9,999 you were conned out of, because you were under pressure to buy it, before someone else does. And the someone else, was probably a dealer’s shill.

So US retailers aren’t so easily going to allow Congress to phase out their sacred cow, the penny. You’d still see some big box store prices at $x9.95 without it. But the grocery and convenience stores would hurt the most, for the loss of the penny.

Quite frankly, I’m sick of handling pocket change. I’d like to see a debit card, that stores and dispenses the value of coinage amounts. Allowing us to still use paper currency, but not need the metal coins to make up the difference. A coin debit card could hold up to $20 of value. Be converted to whole dollars any time. Recharged whenever near depletion. And used for snack machines and payphones. Cashiers or self-use debit card machines, could to this. And the lost of such a card would usually be no big deal, as it’s NOT a credit card, with our personal info on it. And usually represent only a $10 loss, on average. If that’s too much to loose, then keep only $5 of value on it. And be more careful!

And BTW, yeah I know, Herman Cain’s “9-9-9” phrase. Why do think he used those numbers? Because as a former retail executive, he knew the deceptive use of “9”. So he’d protect the penny.

Gildersleeve says:

Sorry folks, it’ll stay in one form or another. My first thought here was to run to Canada and gather as many pennies as possible for their collector’s value. But they’re probably are expecting a run on pennies for this reason. Look at all the pointless coins the US Mint stamps out that are either not circulated, or the less popular ones like the Sacagawea Dollar, or the State Quarters. These will be available for trade for the rest of the century and longer. What family doesn’t have a Eisenhower Dollar in its collection, or the Kennedy half Dollar?

Steve S says:

That will never happen in the U.S. Pennies provide a vital service to the government. From The Simpsons episode “Who Shot Mr. Burns (Part Two)”:

DNA Lab Guy: Ooh, nice eyelash. Yours?
Police Chief Wiggum: No. We need to find out who it belonged to. We want a DNA test.
DNA Lab Guy: Ooh, ooh, ee, ooh, ooh, that takes, uh, 8 to 10 weeks.
Police Chief Wiggum: [sighs, hands him a carton of cigarettes]
DNA Lab Guy: Did I say weeks? ‘Cause I meant seconds. [runs over to another machine, grabs a card from it; puts it in a computer]
Police Chief Wiggum: What do you got, the whole town’s DNA on file?
DNA Lab guy: Y’uh huh. If you’ve ever handled a penny, the government’s got your DNA. Why do you think they keep ’em in circulation?

Holdfast says:

42 years ago, the UK changed its coinage. It moved from 240 pennies in the pound to 100 new ones in the same pound.

From the point of counting, it made the sums easier – a bit like metric. For example, 1oo times 37 pence is 37 pounds. 100 times 37 old pence was 15 pounds 8 shillings and fourpence.

It did have one widely predicted affect. It increased the minimum that prices could go up.
For example, something priced at 5 shillings (60 old pennies) could be increased by a minimal 1 penny or 1.67%. When that changed to 25 pence the minimum increase was 4%.
(I know there were half new pence but before, yhere were half old pennies and quarter ones as well so the effect was even more extreme. I just can’t be bothered to do the maths.

A conspiracy theorist might wonder if those who consider themselves our masters benefit from increased inflation…