Monday, March 31, 2008

MP wants to kill the Penny

Canadian MP to bring forth private members bill to kill the penny. Monday » March 31 » 2008

Private member's bill targets penny

Mia Rabson
Winnipeg Free Press
Monday, March 31, 2008

The Canadian penny

OTTAWA - NDP MP Pat Martin doesn't want a penny for your thoughts. In fact, he doesn't want a penny at all

The Winnipeg Centre MP will introduce a private members' bill when Parliament returns from its Easter break today that would eliminate the penny from circulation in Canada.

"It's a completely vacuous thing to hold on to," Martin said.

The Royal Canadian Mint contends it costs less than a cent to make a penny, but Martin said Library of Parliament research suggests it is as much as four cents per penny.

He said take that, together with the fact that on its own an individual penny is useless, means the penny has outlived any reason for being in Canada.

Most pennies end up in jars or under couch cushions because people don't want to use them and carrying them around is a nuisance, Martin added.

"I don't know who (the Mint is) trying to please by hanging on to it," Martin said.

The Mint has engaged repeated public opinion studies on the subject of getting rid of the penny. The most recent, released last fall, suggests 63 per cent of small retailers and 42 per cent of consumers are in favour of getting rid of it.

Nineteen per cent of small retailers and 33 per cent of consumers are against it, while the remainder are indifferent.

Charities are in favour of removing the penny because it would help avoid the costs associated with collecting donations of pennies, but large retailers are against the idea over fears it would limit how they could price their products.

One third of consumers who were against the idea feared it would result in prices going up as retailers would round up prices to the closest five cent mark.

Martin's legislation would require retailers on cash transactions to round final totals up or down to the nearest five or 10-cent mark. One and two cents would be rounded down to the closest 10 cent, while three and four cents would go up to the next five cents. Six or seven cents would go down to the five-cent mark and eight or nine cents would go up to the 10.

Debit and credit card transactions would not be rounded. And the legislation doesn't prevent any store from setting whatever price it wants for a product, Martin added.

"You can still price something at $9.97 if you want," he said.
The rounding would be applied only on a customer's total bill, not on individual items.

New Zealand and Australia have both eliminated the penny.

Martin said the best evidence of the low value of pennies is the fact that many retailers keep a small dish of them at the till in case a customer needs one to make exact change.

"You don't see a dish of free loonies," Martin joked""

This has been a long time coming for anyone who believes that unbridled monetary inflation is destroying our purchasing power.

Decades and decades of dishonest governments and central bankers which have allowed irrational and unsustainable monetary inflation to eat away at our money's value. Each time they create a billion dollars that cannot be justified by real growth in the economy your existing dollars and cents become worth less.

This is why in 1997 the penny became a zinc slug coated with a thin layer of copper. Years of inflation had made the lowly penny worth less than the metal it contained, much like the idiocy that drove the value of 1960s coins to be worth less than the silver they contained as the balance between coinage and real value had been broken. When Nixon closed the Gold window the final link between currency and value was severed leaving us with an annual inflation(aka currency debasement) of over 8% despite what CPI says.

This bill may not pass but it is a sign of things to come, the penny has less buying power now than the 1/2 penny had when it was removed from circulation. The only thing holding back government is the imagery associated with killing the penny and the fear of acknowledging to the public what they have done to our money.

They do not see that money should represent something more than an empty promise to pay. Money should represent something of real immutable value like Silver and Gold. Buys yours now before they decide it should only go to industry.


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