Issue date: 9/29/08 Section: Money/Health

Picking lost pennies up off the ground is something senior Robyn Fennig does. But not just for luck.

"I stop and pick up whatever I see I guess. It's because I'm a college student, I don't have a lot of money … there's a lot of other college students who wouldn't stop to take the time to pick it up," she said, adding that they use their credit or debit cards before using exact change.

College students who neglect pennies are, in a way, like society.

Fennig said she believes that the penny still has economic importance, even though it is overlooked by society.

"How many people do you ever see stop to pick up a penny that's sitting on the ground? People always say, 'It's just a penny,'" she said.

Fennig, who uses pennies almost on a daily basis, added that she feels as though every penny should count especially with the current state of the economy.

Economically, pennies allow things to be priced in a more precise way, professor of Economics Wayne Carroll said.

At this point, he said, the penny costs the government a lot of money and isn't worth the cost to continue minting and using them. He added that retirement wouldn't be a problem.

"Some economists have studied this subject pretty seriously and some of them have argued that if we didn't have the penny … it wouldn't really make a significant difference. We would round things up to nickels and it would not have a significant impact on the economy," he said.

Representative of the non-partisan group Citizens to Retire the Penny Jeff Gore said he feels that the penny lost its purpose a long time ago and that most Americans would agree with him.

He also said that the economic standpoint of the penny depends upon one point.

"I think the real question to ask is whether it facilitates commerce, which is the purpose of money, and I think the answer to that is no," he said. "We don't need to divide prices down to the cent."

Fennig, who disagrees with Carroll and Gore, said that she thinks the penny is still worthwhile economically because of item pricing.

"It's very rare that you have a price (within) five or ten (cents) and I think it would be really difficult to pay for things without the penny.

Penny waste

Gore said retirement would also be helpful. It would save two resources for the government - money and time.

"It currently costs more than a penny to make a penny … which definitely seems like a waste of resources," Gore said.

Citing a study done by Walgreens and the National Association of Convenience Stores, Gore added the study found that on average 2.5 seconds are wasted in a cash transaction as the result of taking pennies.

"This doesn't sound like very much but if you assume that you have couple of cash transactions per day, there are a couple people in line, etcetera, etcetera. It comes out to be a significant drain on all our time and therefore money and each of us wastes a couple hours of our lives just handling pennies each year," he said.

Carroll agreed with Gore, saying that it might be more convenient for the public not to worry about dealing with transactions in terms of single cents.

Retirement

While it makes sense to retire the penny, Carroll said, sentiment is one of the things that will keep it in circulation.

"We all have memories of using pennies when we were kids, so I think that the public would resist having pennies taken out of circulation," he said, adding that the tribute to Abraham Lincoln on the penny is a vital point as well.

Carroll also said that the penny situation is comparable to one-dollar bills. It would cost less for the government to use one dollar coins which last longer than bills, he said, adding that coins can last for decades while bills can't. However, Carroll said, people are attached to the traditional ways of payment.

"We like our dollar bills, we like our pennies, we like them the way they are and I think people would resist any significant changes," he said.

He added that if current trends continue, the personal value of pennies will become smaller and smaller and the argument for eliminating them from the coinage system will grow stronger. However, he said it may take anywhere from 20 to 40 years for retirement.

Gore said that the penny has not been retired yet because it's not an issue that people spend a lot of time thinking about.

"We have a natural preference for the status quo unless there's a real burning need to change something," he said, adding that once people begin to think about the issue, they will reconsider their opinions about the penny.

Retirement is not in the near future, Gore said. However, it's not whether it happens in five or ten years, but that it happens because it is time to retire the penny, he said.

However, Fennig disagrees. She said she does not believe that the penny should be retired, as she feels it would be very difficult to change the system. She also said that when businesses price their goods, it is easier for them if they have the freedom to utilize the penny.

In comparison, other countries are downsizing their coin currency and switching to paper, whereas in the past, the U.S. has tried to increase their coin currency.

"They tried to use more coin currency, … the Sacagawea dollar, they tried to use other dollars, that really just flopped."

While Fennig is in support of the coin, its future could be a toss-up and penny retirement could still happen, she said.

"I think it's a possibility, just the way society uses the penny, that someday it just might disappear."

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