[FONT=Calibri]There are two possible scenarios. [/FONT]
Congress stops acting like a bunch of idiots (unlikely) and finally get rid of it.
Scenario #2: (More likely)
Businesses stop using them and the customers don’t care. This means that businesses will stop asking for pennies from Banks. If banks only receive pennies and do not give pennies to businesses, then the pennies start to mound up in banks and at the mint. The mint will make fewer of them. As fewer are made, fewer are desired. The spiral continues until the mint just quits.
Just in case anyone is interested, there is a Wikipedia page that addresses the pennies argument [COLOR=blue]here. They handle the issues well and note the total uselessness of the coin.[/COLOR]
Please don’t bring out the tired old reasons for keeping the penny until you read the wikipedia page. [/FONT]
I don’t follow. Is it not the store who sets the prices? If the penny was to go away, the store would either round up or down the price on the total customer balance. Note, this does not mean that it always screws the consumer. See wikipedia page for related study.
Stores use penny increases to make it harder for consumers to compare prices with other stores. Few shoppers walk around with calculators, so it’s easy for stores to decrease a featured advertised product by a nickel or a dime, while more than make up for it by increasing the price of some of the unadvertised but commonly shopped for products by a penny or three.
and im sure every waiter/waitress right now wishes to punch you in the face for that. the weight difference between 70 bucks worth of ones and 70 bucks worth of dollar coins isnt a neglegible difference.
Eventually, a loaf of bread will cost $35 billion, if you extend the rate of inflation out however many centuries. Of course, most of the digits will be (for all intents and purposes) meaningless.
Really, if the lowest digit of fiat money has become pointless, the answer is to shift everything to the right one place. There’s no value in having a wasted space on the right of a price. Removing the penny is a short-term solution, and eventually you’ll just re-introduce it when you do shift the currency by one (or however many) decimal places.
I spent six months in Switzerland in 1967 and they had largely stopped using their smallest coin (called the Rappen). Even if the items were labeled in amounts not divisible by 5 the totals were automatically rounded up or down. With the exception of one dept. store that had automatic change machines. So if your bill was 13Fr47 and you gave the cashier a 20Fr bill, she pressed a button and out came a 5Fr coin, a 1Fr coin, a 50Rp coin a 2Rp coin and a 1Rp coin.
In 1970-71, I lived there again for over a year and the 1 and 2 Rappen coins were (literally) history. The Fr was worth about 23¢ in those days probably twice what a dollar is worth today.
Two days ago, I had no change (left my change purse home) and I bought something that cost $2.01. I paid with a $5 bill, expecting to get $3 in change. No, I got $2.99 exactly. Amazing. This was at Staples, incidentally. (What can you buy at Staples that comes to $2.01 with tax? A bottle of Wite-Out.)
People got along just fine when the US dollar was worth 50 times what it is now, making one of their pennies worth more than a quarter is worth today. People didn’t seem to be clamoring for smaller change then.
I’ve been for getting rid of the penny for awhile, but I became a total convert when I got my change from Taco Bell and it was missing one penny and I realized that I didn’t really care. Then I wondered if the cashier was doing this on purpose, and calculated that over the course of his shift he could make a whopping dollar or two by shortchanging pennies at the very most (most likely less)! Big whoop! If it’s not even worthwhile to steal pennies, then get rid of it posthaste.
This thread is about the mint no longer making pennies. That does not mean that prices will no longer be allowed to be demarcated in pennies (see: Gallons of Gas, 9/10 cents charge on.)