Resolved: The U.S. coinage system urgently needs to be reformed.

I think several threads on the Sacajawea Dollar have missed the broader question of general coinage reform. I think this is an idea whose time has come. I came to this conclusion recently one day when I was idly looking at the four coins then in my pocket. Each of the four commonly circulating denominations was represented: penny, nickel, dime, and quarter. The purpose of money is to be a convenient medium of exchange. So, by way of a thought experiment, I went through my coins one by one:

Q: This is a penny. Can I buy any article of merchandise in any store with this? A. No.

Q: This is a nickel. Can I buy any article of merchandise with this? A. No.

And similarly with the dime and the quarter. I wondered why they even bother to make them any more. I shared these thoughts with my beloved, and she said, “But what about parking meters? And I just bought an art pencil the other day for $.16.”. Well OK, but it used to be that
pencils, just about the cheapest article of merchandise one can buy anywhere, cost a penny or two. A similar argument might be made in the case of parking meters. They used to take pennies, a few of which were presumably sufficient to cover a typical parking meter visit.

Now I know we can’t roll back prices to those of the fabled good old pre-inflationary days. So it would seem that something will have to be done with the coinage system, unless we end up making all transactions electronically and eliminate cash altogether?

What are your thoughts?

(Moderators, I put this here because it doesn’t seem to be great enough to be a GD. But if you think differently by all means promote it to GD.)

The fallacy is obvious. You don’t buy things with pennies or nickels; they are used for change.

How many times do your purchases come out to be exactly divisible by ten cents? (Theoretically, one in ten, but I suspect the actual number is slightly lower).

My idea for currency reform … although us yanks, known for being very conservative when it comes to even the most minor changes to our money (I know people who hate the state quarters, because they aren’t “real”)

  1. Redesign all U.S. coins. Indicate the denomination in Roman numbers, not words (“Quarter Dollar,” “Omne Dime,” etc.)

  2. Drop the penny. With pricing, do it like the Aussies – round down the amount of the price ends in 1 or two cents, round up the amount if the price ends in three or four cents. In the end, everything evens out.

  3. Drop the half dollar. The only place it’s seen now are in casinos.

  4. Screw the printer’s unions. Drop the dollar bill. Not connected with the Mint, but still, something that really needs to be done if the dollar coin is to take off.

  5. Screw tradition. I want pretty, multi-colored paper money showing the country’s natural wonders, not stuffy bills that look like 100 year old stock certificates with images of buildings in Washington.

All of the above answers make cents to me.

1 cent coin/1 dollar bill
5 cent coin/5 dollar bill
10 cent coin/ 10 dollar bill

so far so good! Now comes the twist

25 cent coin/ 20 dollar bill WTF!!!
why no 25 dollar bill??
50 cent coin/50 dollar bill. Back on track.

It has bothered me for some time now.
Carry on.

Dimes and quarters are still used quite extensively in vending machines, pay telephones, and coin-operated washing machines and dryers. In fact, the dime has been given new life since they have raised the price of a phone call to $.35. You may think that “everyone” has a cell phone these days (or their own washing machine, for that matter), but it’s just not true :).

I would personally hate it if we had to round prices the way elmwood reports that they do in Australia. I am thinking, specifically of “.99” pricing. A store can price something at $19.99, get the unwary consumer to think that that is “cheap” (since it is under $20), and then the store gets the extra “penny” anyway. (I put penny in quotes because, of course, pennies would no longer exist.) I don’t know how common “.99” pricing is in Australia, but I doubt sincerely that things would “even out” for the average consumer if this policy were followed in the United States. It could also possibly be a sales tax nightmare, but, of course, even with pennies, there is rounding there, so maybe not. At least now, there is only rounding on the tax itself, not the price of the item.

Hey, Booker57, where’s the 2-cent coin? :).

Sackies need to become more “common”, because people hoard “weird” money. I’ve never received one as change anywhere. They may have to get rid of the dollar bill in order to make people spend Sackies like regular old money. I’ve noticed that they did not redesign the dollar bill, so it’s only a matter of time, methinks.

IMHO the problem in the US is that stores all go into denial about sales tax - all prices are quoted before tax. In sensible countries (i.e. here :)) the price you see on the ticket is the price you pay. If the ticket price is a nice sensible round number then you know that you can pay without resorting to worthless pennies. Not so in the US of A. What are the chances of getting a sensible total after adding that 8% or whatever? Zilch.

I read the funniest article on pennies a couple of years ago. It took the form of a letter home from an african tourist in the country.

I couldn’t possibly do justice to it by paraphrasing. Suffice to say that he concluded there must be religious significance to the random exchange of worthless tokens following commercial transactions.

In Australia, “.99” pricing simply became “.95” pricing. So your item would be $19.95. Works like a charm. (Of course, your pocket gets filled with 5c coins, but they’re much more useful than 1c or 2c coins.) Most items are already priced at a multiple of 5c, but items in supermarkets are still 67c or $1.21 or whatever, and the rounding is done on the final total.

I have to admit, I love the rounding system. It’s just easier not to have those 1c and 2c coins floating about and never getting used. Since being in the UK, where they still have 1p and 2p coins, I never know what to do with them. At least my spare change jar is getting full.

My biggest problem with American money - aside from a pocket full of pennies - was being able to tell apart the bills. I always had trouble knowing what I had in my wallet and had to read the numbers to know what I was handing over. Australian notes are different sizes ($5 smallest, $100 largest) and vary pretty dramatically in colour (pink $5, blue $10, orange $20, yellow $50, green $100) and it’s much easier to know what you’ve got in your hand or wallet. (They’re also made of plastic and have little holograms and clear windows. Fun!)

But I was in love with your quarter. Hang on to that one. You only need four to make a dollar! And only two to make 50c. I’m not sure why this appeals so much, but it does. It just seems so much more practical than a 20c coin.

I had mixed feelings about the $1 bill - I tended to accumulate a lot of them, and they made me think I had lots of cash when I didn’t. But that’s just because I wasn’t used to them. There’s also something to be said for the $2 coin - in Australia, it’s nice, small and cute. You can have ten bucks in your pocket and not even realise it. It can be a nice surprise.

I can’t believe I have this much to say on different countries’ currencies. (I love French money. I couldn’t believe they actually had “The Little Prince” on one of their notes! Cool!)

I have little to actually say, because Nicko stole most of it. :slight_smile: I agree with everything he said (I would stress that the rounding affects very little, though I think they’re allowed to always round down now… anyone wanna catch me up on that? I’m not at all sure, it’s been that long since I’ve actually bought something that was rounded.), except that for the bit about quarters (though I admit 2 of them making 50c is kinda appealing, 2 20s and a 10 is just… slightly less so).

I do kinda miss the 2c coins though, but that’s just because they had a picture of a frilled neck lizard on them and I have a lizard obsession. :slight_smile:

One other thing though: quarters, pennies, nickels, dimes… what’s up with that? Well okay, quarter = quarter of a dollar, but calling… whatever amount of money they actually are (I don’t even know!) pennies, nickels and dimes just irritates me. Do you have a special name for a $5 note, or a $20 note? (Please excuse me if you do, I’m just an ignorant foreigner) Seems much more sensible (and in keeping with decimalised currency) for things to just be X unit coins/notes.

You’re missing the point. Sure the nickel and penny have always been used to make change. But long ago you could buy something with that change. If you got a nickel change for some purchase you could still take that nickel and buy a newspaper or something with it.
I suppose you could argue that our grandparents were constantly being bilked of the “mills” retailers used to round up to the next penny, since a penny then was about like a dime now.

Sure the consumer might lose in a sense, if the tiniest denominations were removed from circulation. However, I think we’re losing more now under the situation we have now:
Bulky coins, absurdly low in value in relation to their size and weight, tend to pile up in our pockets, at home on the dresser, and so forth, because it’s too inconvenient to carry them around and remeber to use them. Any money you own and don’t use is a cost to you. Think about that jar of pennies and nickels which you haven’t been getting around to cashing in. You earned that money at your job (or somebody did), and now it’s basically removed from circulation. Who pays for that?
You do.

Is this legislated, or is this just standard retail practice? Do they round up at .99, like elmwood said, or do they always round down? We often have “.95” pricing here in the US, too, but I can’t imagine US retailers having a legal way to get an extra $.01 out of you and not using it!

Um, just an f.y.i.: in New York (and I think in most states that have a sales tax), it’s actually illegal to list prices as “tax included.” I think there are exceptions for items under 1$, and of course some stores do it anyway and no one really cares.

Oh, and you’re wondering why. Well, remember that this great nation was founded because of a tax revolt. Anti-taxers hate the idea of included taxes because then the average schmo doesn’t care about the tax anymore. The concept is that if people are forced to think about the tax each and every time they make a purchase, they’ll be more vigilant about letting it increase. NYC has just about the highest sales tax in the country (8.25%), and IIRC that’s less than half of the VAT payable in most other OECD countries.

(The really radical anti-taxers also hate withholding, for the same reason. Note that those who resent paying taxes the most tend to be the self-employed, who actually have to fork over money that’s already been in their hand. When you never see the tax dollars in the first place, you’re much less annoyed. Hey, you might even get a refund, which feels wonderful even though it’s the government that gets the float.)

I’ve never actually gone and checked the exact laws, but here’s how I believe it works:

Almost all prices are a multiple of 5c. The only times you’ll see prices that aren’t is really at places like supermarkets. If you pay by EFTPOS or some other electronic means you pay the exact price, it’s only when you’re forking over physical money that there is any rounding done. i.e. 5c is not a quanta of Aussie money, it’s just the smallest amount you can represent with physical money. Which means that the rounding is done once for whatever you’re buying, not on each item. Originally I believe they legally had to round to the nearest 5c, now I think they can always round up (which is what I meant to say in my previous post, but it came out sounding a bit like down). But even so, it’s not a very big extra profit for the supermarket if they get at most 4c on a $150 load of shopping, is it?

**

I had just taken a field trip to the Federal Reserve Branch here in LA, and the tour guide said the Treasury wa splanning to phase out the dollar bill in five years or so.

Makes sense … but in the United States, sales tax varies from county to county, or in Colorado where municipalities charge sales tax, town by town. Imagine a supermarket ad in Denver having to publish something like 40 prices for each item in a flyer – one for Denver, one for Lakewood, one for unincorporated Arapahoe County, two for Westminster (which spans two counties), three for Aurora (which spans three counties), and so on.

I just want pretty bills and a dime that has “10c” on it, not “ONE DIME.” IMHO, the US has the best stamps in thw world, but the most gawd-awful money.

When my friends and I play Monopoly, we don’t use ones. We simply round up and down. Otherwise you end up with all these useless ones . . .

Ones are not useless. I once managed to acquire and hold every single $1 in Monopoly for an extended period of time. :slight_smile:

I think what everyone here should do is send me all their ones, and I’ll see to it that they are dealt with appropriately. :wink:

Pennies can be done away with. Think about it – most stores you go to that have a penny tray have them overflowing with pennies. The cashier regularly says “Oh, if you’re short a penny don’t worry about it.” Often when you’re due 4 cents in change you get a nickel instead. At least where I live, we’re ready to be penniless. (Wait, that didn’t come out right…)

As for spare change in a jar being a problem, I disagree. So you have a lot of money you’re not using. So? If you’re starving, you’ll make sure to use the money. If you’re not starving, then what’s it matter?

I used to throw my change in a pile on the floor, just to get it out of my pockets. I did that for two years. The pile got pretty big, until my wife appeared on the scene and insisted I clean my room, and bought me a change sorter to facilitate it. Turns out I had $700 (Seven hundred) sitting there. Which was really cool, and paid for part of a trip to australia. Speaking of which, Nicko forgot to mention the australian $500 bill, which as I remember it is sort of ochre-ish, and also much more attractive than american money.