Yeah, like, the government has longstanding rules for how to handle in circulation currency, to include removing old and battered bills and coins from circulation over time. I kinda just assume the plan is to do exactly what you would normally do without making any new ones.
People overstate that problem. They say “businesses” as if all businesses are the same.
Bank of America has 3600 branches in the US. At $20/day, that’s $72k/day, or $26mil a year.
Bank of America has $3.5 trillion dollars in assets. If they’re making 1% interest on that (they’re making far more than that, I promise), they’re making $35 billion dollars a year. So that $26mil makes up less than a tenth of a percent of their total revenue.
Compare that to the Walmart example. First, at Walmart people aren’t just buying one thing. If my cart has 50 items in it, that’s a few cents per item. So we’re really talking fifty cents to a dollar per transaction. Second, Walmart has around 40 million customers per day. (About half of the total number of people who even have a Bank of America account, and we know that not even half of account holders are going to a brick and mortar every day.)
So, a savings of 1¢ per item is a difference of, conservatively (assuming an average cart size of 10 items), $4mil per day, or around $1.5 billion per year. Contrast with the around $26 million from Bank of America.
They just aren’t comparable examples. At its core, the scale issue that you’re outlining only matters if you’re getting it on a huge number of relevant things it applies to. There just aren’t that many actual cash transactions handled by BoA compared to its overall income numbers. Walmart has a huge number of individual items it sells vs it’s overall income.
Fair. We’ll have to see how it plays out. My gut is that the demand probably won’t be there, but we’ll just have to see.
But to be clear, we’re talking about a brick and mortar bank losing between $10-40 a day. Compared to the overall quantity of money moving through it, that feels like it should be negligible. That’s, like, one to two tellers leaving an hour early.
But yeah, the way this should be done is through an act of Congress. Agreed on that. This should really be an easy piece of bipartisan legislation, and the fact that Congress is so broken as to be unable to pass it is a huge indictment in its own right.
I hear what you’re saying, but I don’t know that I foresee this as more than a niche issue.
Obviously this is just a gut feeling backed by no data, so it’s worth the paper it’s printed on. But how many pennies were banks giving to non-business customers? I have to believe that it was super negligible.
The vast majority of pennies were issued to businesses to make change. If businesses stop giving out pennies, how many pennies will the banks be asked to hand out?
Time will tell for sure, but my gut is that the amount of people hoarding pennies will be wildly offset by businesses getting rid of them.
And, in your “what if I asked for only 4¢ from the bank” example. The easy solution is that they just give you a nickel and write the penny off as a loss. The penny is just so low value that it wouldn’t add up to an appreciable loss. Again, that’s gut, but the average bank brick-and-mortar does on the order of hundreds or thousands of transactions per day. If they lost 4¢/transaction, that’s only on the order of tens of dollars per day. They lose more to that in miscounts I would imagine.
A fair point. A better, more modern example is probably the two dollar bill. They’ll just slowly be pulled out of circulation until they’re no longer common.
I’m sure businesses will continue to accept pennies. They’ll just start rounding to 5¢ regardless because they’re uncommon, and if someone brings in 5 pennies, they’ll take them, but eventually the federal reserve will have sucked all but a handful out of circulation.
Probably the same way they handled the halfpenny being removed from circulation. There was no government fiat about it then.
But, luckily, they’ve got 20yrs minimum to figure it out. They’ve just stopped making new pennies. Coins are intended to last 20-30 years. It’s not like they’re going out and stealing everyone’s pennies today.
I doubt it’s a terribly difficult problem for them to solve over the next two to three decades.
I mean, yes, it’s the most extreme version of your position highlighting how ridiculous it is. The hope was that it would highlight to you how silly your reasoning was. If your ideology is predicated on doing the opposite of someone you hate, it requires you to take absolutely nonsensical positions.
But engaging with that requires self reflection, and that’s hard.
But I’m game to call it here as well, if you like. Thanks for the debate. I’ve had fun. :)
Since you brought Hitler into this… Clearly it’s never okay with Hitler. Terribly evil person. If you agree with Hitler on literally anything, you are complicit in the Holocaust.
Hitler loved dogs. Huge fan of them. He had three (well, one and Eva Braun had two). He let his dog sleep in the bed with him. Took it with him everywhere. He was a huge dog lover. Big fan.
Am I required to hate dogs because, by saying dogs are good, I’m agreeing with Hitler? It’s clearly a terribly evil thing to agree with Hitler, right? So I think the only possible moral stance is to hate dogs with every fiber of your being? Isn’t that right?
That’s what your position feels like.
And I think we’ve reached the impasse.
I agree with you that this administration is evil. We have the same opinion of them. We’re on the same side in that regard. And I’m not even saying you’re wrong to despise them. I agree that’s normal and even right.
But when you decide to begin rejecting reality. When you start calling bad things good and good things bad. When you start ignoring the evidence of your own eyes and justifying conspiracy theories because your hatred is more important than the truth. That’s when you lose me. And based on this thread, it seems like that’s where you’re losing most people. And hurting your own cause.
Brother, apples already cost over 60x what they did when the halfpenny was done away with. I think we’re at the point where the discussion is warranted.
But really, there’s a bigger problem here, and it’s that you’ve let your hatred of the current administration blind you. You sound like the person who’s saying that the only reason that the Democrats would do something good is because they’re secretly using it as a front to harvest adrenochrome.
As hard as this may be for you to hear, there are still in fact bipartisan issues in this country that everyone, regardless of party, agrees with. Fewer every year for sure, in this increasingly tribalistic landscape, but they do in fact still exist, and this is one of them.
There’s a list of things that we’ve had bipartisan support for under the Trump administration. Legislation to fight phone scammers. Legislation to lower drug prices. The First Step Act, that helped a lot of non-violent federal prisoners get released from prison and reintegrated into their communities. His work to push against TikTok and other Chinese state controlled information networks in the US.
These are all things that Democrats also support and are pushing for. These are all things that have been good that this administration has done.
Now, all that is wildly, and don’t mis-hear this, WILDLY, overshadowed by the blatant evil, hate, cruelty, and corruption of this administration.
But if you’re so caught up in the “everything the person on the other team does automatically has to be bad because they’re wearing a red shirt instead of a blue shirt,” mindset, you stop being a voice to consider seriously. You will throw all logic and reason to the wind because it’s an attack against your identity to acknowledge that the other side can sometimes agree with you. It makes it where you have to imagine some sort of outlandish, deep state conspiracy to explain why the opposition is on your side about something, because you refuse to accept the obvious. Sometimes there are just issues that aren’t terribly political and almost all semi-reasonable people just kind of agree on it.
You said that you’re not against it because you hate MAGA. And maybe you’re right. Maybe I’ve misread you. But it’s clearly not true that we “all know it,” as most people in this thread seem to disagree with you. And if you aren’t automatically against everything from this administration just because of who they are, then you should be able to produce an example of something they’ve done that you support? I’ve given a list above, so feel free to pick from there. But are you willing to agree that the broken clock can indeed be right twice a day, or is the idea of saying that this administration did a single good thing too much of a threat to your identity?
Businesses already round to the nearest cent all the time. Any time an odd number is part of a 50% off sale, or any time you charge sales tax. The fractions of a cent are too small to matter, and we’ve gotten to the point where the pennies are too small to matter.
You say people will be pissed if you round up, but stores have been slowly increasing prices by dollars for the past few years and haven’t lost a customer over it. A few cents of rounding isn’t going to drive your customer base away. Especially if all the other stores are doing it too.
And just think for a moment. Let’s say the store starts losing 4¢/transaction. The truly worst case where they always floor in favor of the customer. First, they could offset this by just blanket raising the base price of everything by 5¢ and no one would bat an eye, but let’s set that aside for now.
Let’s say a store does 10k transactions a day. Feels like a good average for a large sized store. That’s a theoretical max loss of $400 a day. If the average grocery store customer is spending around $50, that’s $500k of revenue per day for the store that just lost $400. I think that’s pretty safely in the slush. Hell, they probably lose more than that per day on shrinkage alone. And they saved way more than that when they replaced all the cashier’s with kiosks, and I didn’t see any of those savings passed on to me.
No business is gonna fold over a 4¢/transaction loss. It’s a negligible impact on your overall overhead. And even if it wasn’t, the small bump in base price you would need to cover it is so small as to not register with your customer base.
Sure, but does there need to be top down guidance? It seems fairly obvious on its face that you would just round to the nearest 5¢. Or floor/ceil any overage to the nearest 5¢. Those are really the only options, and I’m fine to leave it to businesses to handle which way they want to go on that.
It’s not like the prices a business charges are set in stone by God. They can charge whatever they want. If milk is $1, and bread is $2, but they want everyone who buys milk and bread at the same time to pay $4, they can do that. It’d be a weird and unwise decision, but it’s certainly allowed. So in the same way if they want to charge you $1.50 even though your “actual total” came out to $1.48, that’s absolutely their prerogative, even without the penny going away.
It’ll probably require some changes to PoS systems, and getting that rolled out might be the harder part, to your point. But the PoS guys have until all the pennies exit circulation to figure it out, so that’ll be the better part of half a decade at minimum.
You have to remember, they’re not going out and stealing all the pennies. They’re just not making more. Businesses have a lot of time to prepare for this. This isn’t an overnight process.
The problem with your meter analogy is that the length that a meter is measuring isn’t slowly shrinking. If, in 50 years, instead of my room being 5 meters across it was instead 50,000 meters across, then yeah, I’d probably recommend we start measuring rooms in kilometers. And whereas I would care if you told me my 5mx5m room was actually 4.5mx4.5m, I probably don’t care that my 49999.5mx49999.5m room is missing that exact same half meter.
And think of it this way. If Walmart (or any other store) were to, instead of “stealing your extra pennies by rounding up to the nearest 5¢,” simply raise the price of all your groceries by 2ish¢, would that change your buying habits? Would you suddenly refuse to buy your groceries or go drive to another store because they raised the cost by 2¢? Probably not. So, if that extra 2¢ was super meaningful to the bottom line, they could already steal it from you. They don’t need the pretense of rounding.
This has been proposed for a long time, and it’s been luck of the draw which administration chose to do it. You’re letting your hatred of Trump make you jump through irrational hoops to try and justify why this has to be a bad thing, because they idea that it could possibly be good, even by purest luck, is a threat to your identity as a person.
Or maybe not. Maybe I’m just armchair phycologist-ing. But your stance isn’t a reasonable one. If in the future an apple costs $5000 and we’re still printing the penny, there’s no logical framework for keeping the penny. It would take 500,000 pennies to buy an apple. You’d have to bring in a pallet of pennies to buy it. If you think we should keep printing the penny at that point, then I don’t think we’ll ever see eye to eye.
But if you do agree that once apples are $5000 a piece we can stop printing the penny because it has no use, then we’re just arguing about where/when the line is to get rid of the penny, not that the line exists at all. And if that line exists, I think it’s fairly obvious on its face that we’re overdue.
But we used to figure everything to the half cent. That’s my point. We stopped figuring it to the half cent when we got rid of the half cent coin.
In the same way, we would stop figuring things to the whole cent if we got rid of the penny.
As an example, let’s say I wanted to buy an item that was $1.75, but it was 50% off. How much does that cost? In reality, it should be $0.875, but we don’t track to the half penny, so we just call it 88¢.
Or, if you buy something for $1.50, but there’s a sales tax of 3%, that item will be $1.545 after sales tax, but they just round it to $1.55.
They’re already rounding your numbers up. That’s already happening. The only reason it feels different is because we “don’t track fractional pennies,” which is only true because we got rid of the coins that allowed us to track fractional pennies.
If we got rid of the coins that let us track individual pennies, we would also stop tracking all exchanges to the individual penny, and simply round to the nearest 5¢.
Which, in many cases, could actually work in your favor, I might add. If you bought something and the total was 1.52, they would simply round it down to $1.50. Sales tax law varies state to state, but that it’s how the vast majority of states handle fractional pennies already, so precident indicates it would be that way for rounding to the nearest 5¢. E.g. if sales tax is 2%, and you bought something for $1.19, that comes out to $1.2138, but most states round that to $1.21, saving you 0.38¢ (38 one hundredths of a cent).
I wasn’t saying I thought that was your actual position. I was saying that your actual position made as much sense as that.
There’s no difference in kind between rounding to the nearest penny or rounding to the nearest nickel. It’s the exact same thing, and the question is just “where do you draw the line”?
So should the line never change no matter what? Regardless of any real life implications the line is drawn exactly where it was meant to be by God at the beginning of time and it is devoid of context or reason?
If we had massive deflation to the point where tracking to the fractional cent made sense, I would argue that it might be worth printing halfpennies again. But we don’t. And the idea that companies are going to be robbing you of pennies is no more or less reasonable than the idea that they are robbing you of fractional pennies.
Hell, there’s a real chance it’ll go the other way in a lot of cases, as stores will start marking things as $X.95 instead of $X.99. Someone else did the math based on what economists projected the cost to consumers would be, and it came out to 2¢ per person per year. Not exactly a staggering number.
The fact of the matter is that we have to occasionally re-figure at what granularity it’s worth tracking our fractions of a dollar to. Inflation will always be inflating, and in a few hundred years when a loaf of bread is $250 the idea that we would track fractional dollars will seem as antiquated as the halfpenny does now.
Sure, I mean, I’m also all for raising the minimum wage, as it’s wildly stagnated against inflation. You can be for that and for getting rid of the penny?
Idk, I just don’t understand how I’m “moving the goalposts”? Or perhaps I’ve just misunderstood the point of your comment.
I actually have seen that CGP Grey video before though, and it’s only gotten more relevant as time has gone on, lol. It doesn’t make it bad policy just because Trump is the one doing it.
So should we bring back the halfpenny? Cause right now they’re scamming you out of all those fractional pennies you could be saving, and that really adds up. They’re up charging you 0.5¢ all the time, and robbing those halfpennies right out of your pocket!!!
But if you’re not for bringing back tracking transactions down to the fractional cent, what makes it different to your mind? Why is that ridiculous, but rounding to the nearest 5¢ is way out of bounds?
…what?
Okay, let’s try to break it down for you.
Let’s say that, in 1950, you could buy 10 apples for a dollar. Would you agree that, in 1950, 10 apples were “worth” $1? One dollar’s “worth” of apples was 10 apples?
Now, let’s say today I can buy one apple for one dollar. Would you agree that 1 apple was “worth” one dollar? That one dollar’s “worth” of apples was 1 apple?
Now, if we assume that the “buying power” of a dollar is measured in “how many apples a dollar can buy,” that my current dollar is “worth less” than a 1950 dollar, because it purchases me fewer apples? That the two “dollars” have a different “number of apples I can buy” property?
Yes, in each case I’ve purchased a “dollars worth of apples,” but it’s very much meaningful to define how many apples that is, and track how that changes over time.
And if I cancelled the halfpenny because it wasn’t worth having when it could only buy 1 apple, but right now it takes 12 pennies to buy 1 apple, then perhaps I should have gotten rid of the penny a long time ago. And the nickel. And probably the dime.
Interesting. Makes sense.
I’m sure some re-enter from, like, coinstar machines or something, but that’s gotta be a tiny minority.
But that seems like another point in favor of discontinuing them. If people who get them literally never use them, seems like a pointless coin, lol.
But it seems like they’ll probably self eliminate one way or the other over time. I guess the concern would be that they’d self eliminate too quickly, as no one who gets them ever spends them, so basically every distributed penny just instantly vanishes.
But I think the problems with cutting over will largely just be minor heartache. Like, it’ll be minorly bumpy for a month or two, but by a year out everyone will have figured it out and no one will miss them.