If you were feeling cynical about the state of politics and governance in Ottawa, recent news out of the nation's capital will likely improve your opinion.
Lower taxes? Improved healthcare? Karaoke night with Stephen Harper?
No, no and thank God, no.
The Senate national finance committee is making a recommendation that Canada abolish the penny. This is enough to make economists stand up and take notice, after all who better to analyze issues related to the country's finances than a gaggle of overpaid political brown-nosers with a guaranteed, obscenely cushy, public-service-job-for-life.
Nonetheless, the issue does bear some consideration. The lowly one-cent coin costs the Royal Canadian Mint 1.5 cents to produce and distribute. The mint produces about 1.2 billion of the copper coins each year. Do the math. According to economists, the penny has lost 95% of its value since 1908. This statistic has been splattered all over news articles about the coin. No one can tell me why they picked 1908 when in fact the first Canadian cents was introduced in 1858, but hey I don't run the news ticker.
I think you would be hard pressed (pardon the pun) to find anyone in the country who would miss the coin. As currency goes, the Canadian penny has fallen on seriously hard times. Most people find them useless and annoying. Even the lowest denomination of Canadian Tire Money has more value than a penny. It isn't even made of copper any more. Most of the metal is steel, the copper is just a coating. That's just sad.
Unless you are a numismatic (go ahead Google it ... I'll wait), the end of the penny won't bring much fanfare. As it turns out, Canada is not the first nation to jettison the penny. Australia and New Zealand have already done so. As consumers, we might wonder what will happen at the cash register. Nations who already canned the penny addressed this issue by asking merchants to round up cash purchases to the nearest nickel. Presumably this rounding up calculation would generate a small benefit to vendors, and perhaps a nightmare for accountants, but thus far this has not proven to be the case.
Of course the one cent denomination would not completely disappear from the economy. The tiny little digit would still be necessary to ensure that accounts balance properly. Credit card and debit purchases would not be rounded up.
There was a time that a penny could actually buy you something. When I was a kid you could get a gumball or some other treat from one of those little shops with aisles of glass containers filled with all sorts of cavity inducing confection. For 25 cents you could fill a small paper bag full of brightly coloured, hardened or chewy, sugary treats. I have fond memories of those days ... so does my dentist. That was several Prime Ministers ago. Today 25 cents won't even get you a call at a payphone (it's 50 cents if you were wondering, the price magically jumps to a dollar if you use a credit card).
A penny-less society would also be left with phrases and idioms that have suddenly lost meaning and relevance in popular culture, like: penny wise, pound foolish or a penny for your thoughts or a penny saved is a penny earned. Well, let's not put the cart before the horse.
Admittedly I feel a tinge of nostalgia for the little coin. It does give one pause to think that they lived long enough to see currency transition from having some value to virtually none. Then again rampant devaluation has been de rigueur from Wall Street to Bay Street in the past couple of years.
So, it looks like it's farewell for our little copper friend. Not sure what to do with my old pennies. Presumably the government and banks will honour the coins value until they have all been cashed in. The upside in cutting off penny production is that it could generate significant savings for the government, and if we're lucky, the taxpayers ...
... ha, ha, ha, ha, ha ... ah, I had ya going there, didn't I?
In the end, perhaps we owe a debt of gratitude to the Senate. Who knew that they could actually identify something more useless and costly than themselves?
Give yourselves a raise and take the rest of the year off.
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