Should We Make Cents?

Morley Safer On The Bizarre Economics Of Producing Money

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But its fans say a penniless America would leave the penniless truly penniless, because merchants would round prices up to the nearest nickel.

Mark Weller is the voice of "Americans for Common Cents," a pro-penny group that claims that rounding up will cost Americans $600 million a year. "You're going to be hurting those that can least afford it. The folks that don't have checking accounts, that don't have charge cards, are the ones that are gonna get hit," Weller argues.

He says without the penny, charities, too, would suffer, on the theory that people are less likely to donate as many nickels. As it is, penny drives around the country collect tens of millions of dollars a year for medical research, for the homeless, for education. "You have school groups all over the country that are raising funds for important causes on Katrina relief or new computers or other issues for their schools," Weller says.

But as Weller freely admits, he's got a financial interest in the high cost of penny pinching: Weller is a lobbyist for Jarden Zinc, the Tennessee company that sells those little blank discs for the mint to turn into Lincoln pennies.

"If you don't have the penny out there, it would be a major kick in the pants to the zinc industry, wouldn't it?" Safer asks.

"I think if you look at overall uses of zinc in the economy, this is a smaller part of that overall. I think if you look back at the merits of argument which is what happens if you don't have the penny and you round transactions to the nickel, that's a loser for charity groups, that's a loser for the American public," Weller says.

And on the contention that rounding to the nickel would force prices up, mint director Moy says Weller may have a point. "We've taken a look at the studies of countries who have gotten rid of the lowest denomination coin. There's always at least a one-time inflationary hit upwards," Moy says.

"Prices have a habit of doing that, don't they?" Safer asks.

"People are generally in the business of trying to make money," Moy says.

But the business of making money - literally - isn't all bad. The cost of producing most currency is far below its face value. Paper money for example - ones, fives, tens on up - cost six cents each to print. Only the penny and nickel are big-time losers.

"The nickel you can argue about. And maybe it helps, maybe it doesn't. But to me, the penny is just obvious," says Jeff Gore, a young scientist at MIT who says keeping the penny is costing all of us, in more ways than one.