Turin wrote:
I'm in favor of keeping the penny for two reasons. First, everything will cost slightly more. Once the penny is gone retailers will be quick to round their prices, and you know they won't be rounding them down.
By law, they would round to the nearest 5c, or they could use a more complex scheme which makes it very, very difficult for store owners to get the rounding to always go in their favor.
For noncash transactions, they would be kept to the nearest 1c.
turin wrote:
Secondly, I prefer to use cash whenever possible. It makes me really consider if I actually want to buy something if I have to actually hand over a tangible object. It's too easy to spend when all you do is swipe a card. This is going to get bit slippery slopeish, but if we get rid of the penny, I can see the rest of the coins dissapearing next, then it's on to the bills.
This would make it cheaper for the business to deal with cash transactions since they would not require the time to dispense small change.
Of course the next coin will vanish eventually. It's called inflation. The measures are unsatisfying, but in some sense, the penny has about 25 times less buying power then it did about 50-60 years ago. Why bother to keep things to that level of precision?
Further, new 1$, perhaps 2$ or 5$ coins would be minted (eventually) to ease your use of cash - particularly with vending machines.