idran:
John Green’s tumblr: What the Death of the Canadian Penny Says about the U.S.
kingofdoma:
tiredandinspird:
“Canada is scrapping the penny, ending production of the country’s smallest unit of currency this spring.
Finance Minister Jim Flaherty, whose department described the penny as a “nuisance” in budget documents, said the coin is now more trouble than it’s worth.
…
Oh. Okay. That’ll do. Also, the States needs to get rid of their penny as well and put the savings towards NASA. Everyone bloody wins. :D
While yes the penny does cost more than a cent to manufacture (2.41 cents per penny in 2012, actually, not a cent and a half), that doesn’t mean that each penny is a loss for the government, because pennies are used more than once. A penny contributes one cent of value each time it’s used, not just a single cent of value universally. The economic value contributed by an item of currency is its value times the number of transactions it’s involved in before it wears out or is pulled from circulation.
While I’m in favor of dropping the penny purely for convenience’ sake, that argument against it is very specious.
Well … a physical penny is a sunk cost. A government itself does not derive any further income from its manufacture. It doesn’t make any money from any currency denomination - given national debts, it loses standing as it prints and mints more money.
Also, as tumblr is rarely an original source - http://www.theglobeandmail.com/news/politics/ottawa-gives-up-on-nuisance-penny/article2386120/ - which does actually mention the inflation concern (while minimizing it).
It’s weird Ottawa isn’t mandating Swedish Rounding - it’s likely everyone is just going to round up without it. Though its not like the concept of a single cent is going to go away.
It would be funny if Canadians started using US Cent coins once their own were mostly gone. The two are used interchangeably enough now near the border.
(via idran)