The Instigator
SGM_iz_SekC
Pro (for)
Losing
0 Points
The Contender
ChosenWolff
Con (against)
Winning
4 Points

In the US, pennies should be abolished.

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Post Voting Period
The voting period for this debate has ended.
after 1 vote the winner is...
ChosenWolff
Voting Style: Open Point System: 7 Point
Started: 6/17/2014 Category: Economics
Updated: 2 years ago Status: Post Voting Period
Viewed: 1,337 times Debate No: 56782
Debate Rounds (5)
Comments (28)
Votes (1)

 

SGM_iz_SekC

Pro

1st round acceptance only
Debate Round No. 1
SGM_iz_SekC

Pro

http://www.usmint.gov...

Cost of Producing the Penny, Nickel, Dime, Quarter, and Golden Dollar Coins.

$1 Coin Quarter Dime Nickel Penny
18.03 cents 11.14 cents 5.65 cents 11.18 cents 2.41 cents
(United States Mint, 2011 Annual Report, pg. 11)

1. PENNIES COST MORE TO MAKE THAN THEY ARE WORTH
This will send the US economy down the drain in the future, with inflation. Pennies are worth less than nothing, because of the cost to make one.

2. IT WOULD NOT INCREASE COSTS BY AN EXTENSIVE AMOUNT
The cost of anything would be rounded to the nearest 5/10 cents. EXAMPLE: $1.01 would be rounded to $1.
ChosenWolff

Con

I. Pennies are used to control inflation

I don't think the OP understands why we have pennies. It's not to control prices, per say. It is to control inflation rates. Let me explain. Pennies have low value, being only .01$, which means we can pump however many out we need to control inflation to the number. It is the most precise way to control inflations rates.

If you control inflation rates, you control prices. If you control prices, you control how much consumption and investment goes through the economy. With that said, it is 100% neccesary to have pennies for monetary control of the economy.

II. Forex Trade will Crash

The Opposition needs to take into consideration the volatity of FX trade. Currecy exchanges are very profitable to the US. Here are two reasons why removing the penny would crash USD exchange over FX.

1. We can not control the USD to ensure ultimate deals by trading USD over Forex.

2. Foreign traders will be forced to round to .05$, decreasing the amount the USD gets bought and sold.

III. NASDAQ and the Stock Exchange will be hurt

NASDAQ is the national stock exchange of America. The opposition has not thought this out. Most stocks are rounded to the penny. For example. Green Energy Co. sells stock for .13$, or the stock of Speedwat right now is 18.14$. The problem with abolishing the penny, is that all stock purchases need to be rounded up to the nearest .05$, which for investors who purchase 1000's of shares monthly, this will completely hinder their investments.

That .01$ adds up, and with the stock market up 140%, this would be the worst possible time for the US to remove the penny.
Debate Round No. 2
SGM_iz_SekC

Pro

As part of its new budget, Canada will get rid of its penny, saving taxpayers more than C$11 million, according to the Royal Bank of Canada. Since production in 1908, the bank has produced more than 35 billion pennies, but circulation will end sometime in 2012.
As part of cost cutting measures, Canada will save at least C$150 million in production and handling costs once the penny is completely abolished. It costs the Canadian government C1.6 cents to mint a penny, a coin made from copper-plated zinc and copper-plated steel. However, it won't only be the government that saves money.
Banks Pay
Saving pennies in a piggy bank may be fun for children, but for banks, the transportation, handling and storage of coins costs about C$20 million each year according to Canadian officials, a cost that has to be passed on to customers in the form of fees. Eliminating the penny saves a portion of the costs associated with processing coins.
More Efficient
Some argue that cash registers will have to be reprogrammed to accommodate the switch, but since the penny will remain in circulation until most pennies are out of circulation and taxes will continue to be calculated to the penny, cash registers and other business machines will operate as they always have.
Catherine Swift, president and chief executive officer of the Canadian Federation of Independent Business, says that businesses welcome the change, since fewer coins will eventually make their business more efficient.
Other Countries Have Done It
Canada is one of many countries that have ended the minting of their lowest-value coins. In 1992, Australia eliminated their one- and two-cent coins from circulation. In January 2008, Israel eliminated their five agorot coin. These countries join at least 15 other countries including Great Britain, The Philippines, Hong Kong, the Netherlands, Singapore and Mexico that have all eliminated at least one of their coins to lower government costs.
When Will the United States Do It?
The most notable hold out is the United States. In 2006, The Legal Tender Modernization Act was introduced by Representative Jim Kolbe. The bill aimed to require that all transactions be rounded to the nearest 5 cents but this legislation failed to pass Congress leaving the U.S. with the same problem as Canada.

Producing the penny in the U.S. costs a lot more than in Canada, according to CNN. To produce a U.S. penny, the U.S. Mint pays 2.4 cents per penny, and that's up from 1.5 cents in 2006. That, along with the production of the nickel, costs the U.S. government more than $100 billion each year, and if it can't be retired, President Obama wants the cost reduced. That, according to officials, is difficult, because the administrative costs of producing a penny account for nearly half a cent, leaving very little room to cover the cost of raw materials.[1]

[1]http://www.investopedia.com...

My old arguments.
Cost of Producing the Penny, Nickel, Dime, Quarter, and Golden Dollar Coins.

$1 Coin Quarter Dime Nickel Penny
18.03 cents 11.14 cents 5.65 cents 11.18 cents 2.41 cents
(United States Mint, 2011 Annual Report, pg. 11)

1. PENNIES COST MORE TO MAKE THAN THEY ARE WORTH
This will send the US economy down the drain in the future, with inflation. Pennies are worth less than nothing, because of the cost to make one.

2. IT WOULD NOT INCREASE COSTS BY AN EXTENSIVE AMOUNT
The cost of anything would be rounded to the nearest 5/10 cents. EXAMPLE: $1.01 would be rounded to $1.
ChosenWolff

Con

I. The Penny costs more than the mint makes it for

My opponent has wasted this round. Look very closely at everything he wrote. He restated his original contention, and I did not argue it, because it's true. The fact of the matter is, even though the US will save a couple million, it will lose 10's of billions.

I will give my opponent one more round to not drop my points. The con's far outweigh the pro's in this debate, which are miniscule. I will address the point regardless. The Canadian strategy was to increase and keep inflation above the USD. As soon as they removed the penny, the inflation of the CD fell extremely far. It went from being .06$ more than the USD, to being .09$ below it.

Canada is a perfect example of a nation who was hit hard by removing the penny.

Do not waste my time in a debate, by droping all three of my contentions
Debate Round No. 3
SGM_iz_SekC

Pro

1. Forex Trade/Stock Exchange will not crash.
The cost is not only rounded down/up, but a combination of both, depending on how close the cost is to the nearest 5-cent increment, which could actually cause a boom in forex/stock.

2. Nickels can also control inflation with lest cost to the government/mint.
Pennies cost 2.4 cents to make, and are worth 1 cent.
ChosenWolff

Con

I. Forex/Stock Exchange

My opponent still does not get it. Rounding up to the nearest 5 cents adds up. Lets say a investor buys 500,000 stocks worth 7.13$, and we decide to remove the penny. If the nickel is rounded up .02$, then the investor loses 100'000's of dollars. Likewise, if we decide to round the penny down, then the seller or company likewise loses 100'000's in equity.

II. Inflation Control

You can control inflation with any kind of currency. The difference between controlling it with a nickel and controlling it with a penny is vast though. Using a penny can round down a inflation percentage to the nearest 0.1. This can help the economy and the world market tremendously.

You might as well just kill the banking industry if you're going to round to a nickel, not to mention the federal reserve will crash, and with it, billions of corporates.

III. Just make the penny cheaper

My opponent has not considered simply removing more silver, zinc, or copper from the penny. Instead of removing it and costing the nation about 100 billion dollars, we could just lower the materials we put in the penny as they leave the US mint. Actually, we do every few years. The penny gets cheaper and cheaper overtime, and the reason the mint is keeping it 2.00$ now, is because we have a inflating economy.

Soon the value of the penny and its cost will equal each other. Come on people. Let's not pull a Canada here.
Debate Round No. 4
SGM_iz_SekC

Pro

I am cut for time and will not be able to post any new arguments.
ChosenWolff

Con

ChosenWolff for president
Debate Round No. 5
28 comments have been posted on this debate. Showing 1 through 10 records.
Posted by bigwood 2 years ago
bigwood
the nasdaq and forex arguments are both misguided and wrong. the Canadian's have a stock exchange called the tsx which wasn't hurt first of all. second of all if you look at stocks and how they are traded you would realize that rounding is not something that is a concern. your argument would lead me to believe that there is a physical value for .001 cent as you can have that attached to a share price. the forex can be shot down with the Canadians as an example again. they trade their currency similarly to the Americans and continue to have values like .87 cents to the USD. Lastly you keep trying to say that Canada has less ties to the penny, well you have not given any evidence to show that before Canadians dropped the penny they had stronger or weaker ties. The only reason that this is a valid argument today is because Canada has no ties to the penny other than nostalgic ones because sentiment wasn't a reason to produce the coin.
Posted by ChosenWolff 2 years ago
ChosenWolff
I have a debate going on involving homosexuality developing in the womb, as well as one situated in the institution of a national commodity exchange. Feel free to debate me on those.
Posted by ChosenWolff 2 years ago
ChosenWolff
Geogeer, I did defend my assertions, although they were not directed at you or anyone for that matter. I stated my opinion, and that doesn't always need to evolve into a debate. Especially since I just finished arguing the "assertion" I apparently made. Relax, as I have a lot of debates going, and it is silly to call me a coward for not wanting to do one a second time, due to somebody calling me pathetic.

I really hope you're a troll right now, or if not, you need to relax and stop being so selfish. I would love to debate you, but just not in this topic. I would be grateful if you accepted another challenge, but I refuse to do this one twice. Having better things to do doesn't make me a coward.

Now if you can find a resolution we mutually agree on doing, then that's fine. Debating is a fun thing for me, and if I don't feel debating a resolution will be fun, I don't do it. A unwise man would, but I pride myself on thinking of greater utility. Now will you stop this god awful ad-hom spree? It is not very tasteful.
Posted by Geogeer 2 years ago
Geogeer
If you're not going to defend your assertions when you make them, then don't begin lecturing me. I make a point of not saying anything I'm not willing to defend in a debate. You should learn to do the same.
Posted by ChosenWolff 2 years ago
ChosenWolff
Georgeer, you are wrong. I have 6 debates going on right now, and 5 debate challenges, 3 of which you can look at here in the debating challenge section. In addition, there are 2 other debate resolutions I really am looking forward to doing. One of which is advocating that Ptolemy's geocentric theory is correct, and the other of which involves proving homosexuality does not develop in the womb.

Throwing insults at me, saying I'm chickening out of a debate I just did, is foolish and trolling. I have a lot on my plate, and I'm young, and summers short. I want to finish my debates and enjoy myself. I don't debate to prove anything. I debate to gain knowledge and have a little fun doing so. There is no knowledge to be gained in doing a debate I've done several times over my life.

If you want to debate me on something I might enjoy discussing, then feel free. I have been moving more into mathematics and science, so there is a start. I simply do not like being called pathetic for declining a debate challenge though. I am not the pathetic one in this situation.

Good day!
Posted by Geogeer 2 years ago
Geogeer
You did not complete this debate. Pro didn't even properly understand the argument. It should be easy for you to argue, you've already done the research and have your arguments (which are completely wrong I might add).

This is not arguing for another nation than your own. It is arguing for your own nation. I'm the one arguing for another nation. I have put the BOP on myself with the resolution and I'll even make it 3 Rounds. I won't need any more.

You have no current debates and this is twice now that you've chickened out of a debate with me. You just prefer to noob snipe than actually debate - pathetic.
Posted by ChosenWolff 2 years ago
ChosenWolff
I just completed this debate, and I'm already arguing a debate for another nation not my own. I need to ease my debating so I can have the summer in peace.
Posted by Geogeer 2 years ago
Geogeer
All hat and no cattle, eh?
Posted by ChosenWolff 2 years ago
ChosenWolff
Ugh, your also a Canadian Conservative though. They're the ones who removed it, which hurt the downtrodden very much. Although I must admit, the socio economic concerns are much more severe in the United States. We have 10 times the people and trade 20 times the equity. Actually, it would hurt Canada to. Most of US liquid is traded between the US and Canada, which is a couple billion.

The abolishment of the penny has never gained popular support, because most have the common sense to understand circulation of such a currency is vital for the survival of the already dwindling middle class, and if I am correct, and abolishing the penny causes long term inflation, the already extremely high prices the lower class pay will raise.

Although I hear a lot of politicians are calling the abolishment of the penny a failure. For a nation with a rising economy, the whole world was shocked to see one of the highest deflations for a developed country. Rounding to the nickel will always cause uncontrollable inflation, or deflation in Canada's case.
Posted by Geogeer 2 years ago
Geogeer
I know that, however Pro did appeal to Canada as an example. Our RRSP is basically the same as your 401k.

Don't worry. I'll evaluate it fairly on what is in the debate. I don't have an axe to grind or a point to make.
1 votes has been placed for this debate.
Vote Placed by Romanii 2 years ago
Romanii
SGM_iz_SekCChosenWolffTied
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Total points awarded:04 
Reasons for voting decision: All of Con's rebuttals went uncountered due to the FF.