Google's Doodle Tribute to Canada's Vanishing Penny

#Money

Mon, Feb 4th, 2013 21:00 by capnasty NEWS

A year ago, the Canadian government announced that it would be ditching the penny. The coin, which is being phased out this Monday due to costs (it currently costs more to make a penny than what a penny is worth) has been featured as a Google Doodle. For the collectors, the Royal Canadian Mint is offering the last rolls for sale.

At no time soon will the U.S. be following Canada’s example of scrapping the penny. That process started Monday, as the Royal Canadian Mint ceased distribution of the nuisance coin to banks and other financial institutions.

The benefits for Americans in following suit are self-evident.

In 2011, the U.S. Mint was spending 2.4 cents to make a penny, which slipped back to the recent norm of 2 cents last year. The loss to the U.S. Mint — to Americans, that is — comes to $58 million a year. For Canada, those figures were 1.6 cents and $11 million.

A century ago, the penny had close to 25 times the buying power it does today. A mere 19 per cent of Canadians still pay cash in retail and hospitality transactions, estimates show. And that 19 per cent, Star reporter Jessica McDiarmid noted Friday, imposes an estimated cost on business of about $150 million a year in handling pennies alone.

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