Idea #2: An ALS-, business- and consumer-friendly way to finally pitch the pennyMarch 16th, 2012 by Al Lewis (alewis)
Lots has been written about the recent report that pennies now cost 2.4 cents apiece to make. The “solution” to this problem ? The government is exploring the use of cheaper metals. Washington dare not phase them out altogether because to do so would invite protests that retailers would round up to the nearest nickel, which might cost the average person at least a couple of dollars a year! Plus, without pennies lying around on the ground, what would toddlers eat?
However, this whole penny-anti “debate” misses the bigger point, which is that many if not most retail businesses feel that it costs more than a penny to handle a penny. In other words, given the idea and the chance to do so, most businesses would be happy to round cash purchases down to the nearest nickel if they were not required to handle pennies. The efficiencies gained by not having to deal with pennies would more than compensate for the loss of two or three cents on a $20 cash transaction.
Obviously consumers would be better off getting a nickel in change than a few pennies that usually just get stored, thrown out, lost or littered, which is why they need to keep making billions more every year. And retailers that didn’t want to go along, wouldn’t have to. They could keep making small change and keep getting frequented by consumers who prefer receiving 1-4 cents to receiving a nickel in change.
This isn’t just my wacky idea any more. It’s been embraced by economists on the right http://gregmankiw.blogspot.com/2009/01/penny-anti-protest.html and the left http://www.usnews.com/opinion/blogs/barone/2009/01/30/obama-could-abolish-the-penny-with-an-executive-order .
Most importantly, actual businesses have done this on their own. Concord Teacakes ran a very well-publicized temporary promotion in 2009 described in the Boston Globe at http://www.boston.com/news/local/massachusetts/articles/2009/02/10/concord_merchants_launch_common_cents_revolution/ . That was three years ago and customers are still asking about it.
The question is, what happens to those pennies that no one wants? The answer is very easy. Stores should put out some charity jars and collect the pennies for ALS. Millions could be raised simply by collecting the pennies.