In 2002, United States Representative Jim Kolbe (R-AZ) introduced the Legal Tender Modernization Act and in 2006 he introduced the Currency Overhaul for an Industrious Nation (COIN) Act. Both bills failed to advance in the house and died when Congress adjourned.
Arguments for elimination
Production at a loss — As of February 2011, it costs about 2.4 cents to mint a penny. In 2007, even the price of the raw materials it is made of exceeded the face value, so there was a risk that coins were illegally melted down for raw materials.
Lost productivity and
opportunity cost of use — With the average wage in the
Limited utility — Pennies are not accepted by all vending machines or many toll booths, and pennies are generally not accepted in bulk; however, Illinois does accept pennies in its toll booths. In addition, people often do not use cents to pay at all; they may simply use larger denominations and get pennies in return. Pennies end up sitting in jars or are thrown away and are not in circulation. Economist Greg Mankiw says that "The purpose of the monetary system is to facilitate exchange, but... the penny no longer serves that purpose." 
Prices would not be higher — Research by Robert Whaples, an economics professor at Wake Forest University, using data on nearly 200,000 transactions from a multi-state convenience store chain shows that rounding would have virtually no effect. Consumers would gain a tiny amount – about 38⁄1520 (1⁄40) of a cent per transaction.
Historical precedents — There
has never been a coin in circulation in the
Hazards — The reduced-cost clad zinc penny, which has been
produced since mid-1982, holds additional dangers when swallowed by children
and others, unlike all previous
Arguments for preservation
Historical sentiment — The cent was one of the first coins authorized to be minted by the American government and the first to be put into production.
Presidential history — Many
admire Lincoln as a president and in addition to the 5-dollar bill, the penny
bestows an honor on
Deflationary effects — Some have argued that because inflation raises production costs of the penny to exceed its value, this imposes limits on the amount of inflation that can be caused by central banks.[dubious – discuss]
On February 28, 2008, Rep. Zack Space (D-OH) introduced H.R. 5512, the Coin Modernization and Taxpayer Savings Act of 2008. If enacted into law, the act would result in the penny being made primarily of steel and treated to have a copper color within 270 days of enactment unless the Secretary of the Treasury can come up with a new element for coin composition that, when added to zinc and copper will lower the price of manufacture to under one cent. According to the act: "Given the current cost to make a penny and volume of pennies minted, simply reducing penny production costs to face value, the United States will save more than $500,000,000 in the next ten years alone." After committee hearings, the House passed the bill on May 8, 2008 by voice vote. However, the bill died in committee in the United States Senate.
Precedents in other countries
Many countries outside the
Canada has minted a one-cent coin of similar size and color as its American counterpart, with steel as the interior metal instead of zinc, though composition was near identical to U.S. cents prior to 2000; so it circulates at par in small quantities in the United States. However, on March 29, 2012, the Canadian government announced that it will eliminate the penny from the coinage system.
The decimal British half penny (£0.005) was first issued in 1971. Being worth 1.2 pre-decimal pence, it enabled the prices of some low-value items to be more accurately translated to the new decimal currency. Inflation over the ensuing 13 years led to the coin being withdrawn from circulation in December 1984.
New Zealand eliminated one- and two-cent coins of the New Zealand dollar in April 1990, and the five-cent coin in October 2006. Prior to decimalization on 10 July 1967, there were two coins smaller than the decimal cent that were eliminated during the changeover – the halfpenny (5⁄12 cent), and the penny (10⁄12 cent)
Bank Negara Malaysia implemented a rounding mechanism on 1 April 2008 in order to round total bills to the nearest 0.05 ringgit, which made the 1 sen (0.01 ringgit) coin irrelevant to normal circulation.
eliminated the one cent of the guilder in 1980 and ceased issuing the one and two cents of Dutch euro
coins in 2006. In
On March 1, 2008,
However, many nations still use coins of similar or smaller value to the US cent. In some cases, while the nominal value of the coin may be smaller than that of a US cent, the purchasing power may be higher:
(except for Finland
and the Netherlands)
uses 1- and 2-cent coins. As posted prices generally include taxes, it is
possible (but not standard) for vendors to round prices to the nearest five
cents and eliminate the need for smaller-value coins. In
Laws regarding melting and export
On April 17, 2007, a Department of the Treasury regulation went into effect prohibiting the treatment, melting, or mass export of pennies and nickels. Exceptions were allowed for numismatists, jewelry makers, and normal tourism demands. The reason given was that the price of copper was rising to the point where these coins could be melted for their metal content. In 1969, a similar law regarding silver coinage was repealed. Because their silver content frequently exceeds collector value, silver coins are often sold by multiplying their "face value" times a benchmark price that floats relative to the spot silver price per ounce.
I thank my opponent in advance for accepting this debate. There will be three rounds of debate with establishing arguments, rebuttals, and final focuses. If definitions are needed for American penny or circulation, I would be happy to provide them.
In recent years, there has been much discussion concerning the necessity of the penny. Many argue that the penny is, "outdated, worthless, bothersome, and wasteful" (1). They claim that the penny should be banned. Others contend that the penny is an important national symbol (2). However, since the penny is obsolete, financially wasteful, and practically valueless, it should be abolished.
First, pennies are becoming
increasingly obsolete. People simply do not use them anymore. In fact, though
Secondly, pennies cause financial waste. Though people do waste some money by disposing of pennies in the trash, the nation is facing an even greater problem. Pennies actually cost more to produce than they are worth. It costs 1.23 cents to make a one cent penny. This may not seem like much, but when the nation finances the production of billions of pennies a year, it is a recipe for financial ruin. However, the problem does not end there. Estimates show that penny transactions waste four hours per person, per year. Considering that these four hours could be better spent working, pennies are responsible for a national deficit of over fifteen billion dollars a year (1). Since the production and transactions of pennies are financially wasteful, we should ban it as a form of currency.
Lastly, pennies are now
practically valueless. The things our grandparents purchased for a cent cost
much more today. William Safire of the New York Times writes that, "…it
takes nearly a dime today to buy what a penny bought back in 1950" (3).
This certainly comes full circle to the fact that people throw pennies out.
They do so because the coin is worthless. No one keeps fifty small coins around
when they could just carry two shiny quarters. On a larger and more significant
scale, pennies are often worthless in international business. The
Some still make arguments for
the penny. One man who saved them for thirty-eight years ended up with
$13,084.59 (1). Mark Lewis of Forbes.com points out that states like
What would be the point of getting rid of the penny? The penny is the basis of all money. Getting rid of the penny would be completely pointless, so why should it be taken out of circulation.
The penny has been being used for hundreds of years without any problems. A lot of people say that pennies aren't really worth anything. But, obviously, in reality they are worth something. Everything can come down to pennies if you want it to. A dollar, 100 pennies. 10 dollars, 1,000 pennies, and so on and so forth.
Getting rid of the penny would throw of our money system. Prices of goods would have to increase or decrease by at least 5 cents every time a price was lowered or raised because a Nickel would be the next smallest coin. You could say "Goodbye" to $1.99 sales or something for $98.97.
Another major issue, taxes on items you buy at the store. Even a $2.00 item, which would seem easy enough to pay without pennies, would become impossible to pay due to the taxes on the item.
So yes, lets get rid of the penny and lose the basis of all our money, say "goodbye" to easy savings and easy financial transactions; sounds like a smart idea, huh? While we're at it, why not get rid of anything less than a dollar! Yeah, that wouldn't make much sense either.