President Obama revealed in February during a Google+ hangout that he wants to end the penny, but will he actually do it? According to him, it isn’t likely, at least during his remaining time as president.
“The penny is something I need legislation for, and given the bigger problems days in and day out, we’re not able to get to it,” he said.
Arguments for doing away with the penny have been floating around for some time now, and from a financial standpoint for the country, it makes sense. Currently, the cost to produce the penny is nearly double their value. It currently costs 1.83 cents to produce a single penny.
“This is not going to be a huge savings for government, but any time were spending money on something people aren’t going to use, it’s not necessary,” Obama added
Aside from that, pennies are simply becoming less useful with inflation as many vending machines are not even accepting pennies anymore. The plan that has been proposed would be to simply round purchases instead of going to the exact cent. Studies have shown that this would have virtually no impact on the finances of individuals or businesses.
In spite of the plan and the cost of production, many argue that we should keep the penny in circulation and try to drive down the cost of production instead. Nickels also cost more to produce than they are worth, and if the penny were out of circulation it may drive up the demand for nickels, meaning it would cut into the savings created by ending the penny.
For now, President Obama has made no official plans to end the penny, but has simply voiced his support for the idea.
President Obama to End the Penny?