Casmin Week 7: Spare Change?
"Hello, will that be all today?"
“Yes, thank you.”
“Ok, that’ll be $4.99.”
“Here’s 5. Can I get change?”
“W-what? NO.. NO!! I DONT HAVE CHANGE AHHHH!!” *cashier crashes out*
That’s what some people imagine would happen after November 12.
As we probably have heard about now, the production of pennies has ceased as of November 12, ending its 232-year circulation in the US. Some people have gone into mass panic after hearing this news, hoarding pennies in the hopes of selling them for a higher value in the future because of their “rarity.” But has anyone really noticed the difference? Even though it’s hard to tell its impact because production stopped 5 days ago (as of when this blog was made), billions of pennies will still be in circulation. And honestly, part of me is happy because prices will now be a perfect, whole number $5.00 instead of $4.99 (yes, prices really bother me just like how our school schedule has not-so-perfect numbers like 1:31pm and 11:18am).
On a more serious note, even the slight raising of prices can cause catastrophic damage to consumers. On top of income, sales, and whatever taxes that are charged to consumers on a daily basis, the government has now implemented a “rounding tax” because of this penny dilemma. Even though a few cents may not seem like a significant amount, these numbers can add up to 6 million extra dollars that consumers have to pay per year according to research conducted by the Federal Reserve Bank of Richmond. This can especially affect older generations and lower-income families who primarily rely on physical cash rather than online pay.
Small on its own, powerful in numbers
Oppression by means of capitalism or monopolies has been so ingrained in American society that it has become normalized by consumers–the group that pays the price for these changes. Though, I must say it’s not surprising because America was built on the very foundation of capitalism dating back to 17th century mercantilism. The fact that the government enforces these changes under consumers’ noses to pay more for goods demonstrates the constant loop of how powerful groups or figures stay in power at the cost of consumers who pay more money one way or another to get the rich richer. Even though the purpose for stopping penny production was to save money, consumers still ultimately have to pay the price (literally!) for these changes.
Even if the pennies under your couch may seem like they will never see the light of day, remember that they have value, no matter how small that margin may be.
In math, the importance of every detail when problem-solving is hotly emphasized—a single, seemingly inconsequential mistake can become a large problem that ultimately leads to the incorrect answer. Maybe I mistake the number 2 for the variable z here, or I forget to carry over a negative sign there. This is how I typically view issues like the ones proposed in this blog: though minute on a magnified view, once the lens is refocused, it’s clear that even a single penny has the power to snowball out of control.
ReplyDeleteLately, the price of everything seems to be shooting up; with the recent tariffs and now this whole debacle. I find myself wondering whether affordability is even an important issue for politicians nowadays, or if they simply shove that issue to the back of their mind while they deal with other concerns. Even though a penny is a penny, it’s also money, and money has power. You articulated this so well in your writing this week. Great blog, Casmin! (:
The United States seems to be riddled with instances of seemingly inconspicuous snowball effects. Of course, the removal of the penny from American currency minting is a clear example, but so was the migration of hundreds of thousands of Americans westward in the mid 1800s to pursue new opportunities in Oregon and California. Each individual pushed through their own hardships for the prospect of success (“rugged individualism”), but together, they formed the basis of the western United States. So is the decrease in the percentage of citizens who vote in yearly elections. Many people cite the supposed hopelessness of the current political climate of America, where a single drop in the bucket won’t do anything, so it’s more worth one’s time to focus on their own life rather than vote. But all of these non-voters together result in a significant dent in democratic participation. The penny is no different; people are getting distracted about the rarity of pennies now and forgetting that they once had, and still do, have monetary value. And in doing so, that value is taken away.
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