When President Trump announced last month that he had directed the US Mint to stop coining pennies, he gave only one reason for doing so.
"For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!" he posted on social media. "I have instructed my Secretary of the US Treasury to stop producing new pennies."
If you've heard that argument once, you've heard it a dozen times. The same point has been made over the years by everyone from HBO's progressive commentator/comedian John Oliver to the centrist Chicago Tribune columnist Steve Chapman to Iowa's staunchly conservative US Senator Joni Ernst.
On the surface, the observation seems logical and germane: Why keep minting pennies that cost more than a penny to mint? What good is a 1-cent coin that takes (according to the US Mint's most recent annual report) 3.69 cents to produce?
 Each of them costs more than 3 cents to make. Is that a problem? |
But that line of reasoning makes sense only if the value of a penny is determined by the physical substance the coin is manufactured from.
For most of history, that is exactly what a coin's value was based on. In ancient Rome, for example, a denarius was understood to contain 1⁄72 of a Roman pound of silver; in 17th-century Britain, a gold guinea was made with approximately one-quarter of an ounce of gold. When the value of the precious metal fluctuated, coins became more or less valuable — and the change in value was reflected in how much merchants were prepared to exchange for them. When rulers debased their coinage — either by shrinking the size of a coin, or replacing some of the silver or gold with a cheaper base metal — prices soared.
Governments are still perfectly capable of reducing the value of money and thereby causing inflation, of course. But they do so now by artificially boosting the money supply, not by decreasing the precious-metal content of their coins. Which is why the whole business about what it costs to produce a penny seems to me completely extraneous.
In today's US economy, the value of most money is not determined by the material from which it is made, but by the social trust placed in it. Pennies — like quarters and five-dollar bills — are examples of fiat currency. They have value primarily because the government says (and people accept) that it does. It isn't the intrinsic worth of the penny's content that matters; it is society's willingness to accept it in exchange for a penny's worth of goods and services. The same is true of nickels, each of which costs almost 14 cents to produce. The fact that virtually no one is clamoring for abolition of the nickel suggests that the "a-penny-costs-more-than-a-penny!" argument isn't a serious one.
To be clear, I am neither pro-penny nor anti-penny. I have no strong feelings on whether our smallest coin should be abolished.
I can certainly see a strong argument for doing so: The purchasing power of the penny has dwindled to almost nothing. Most people won't bend over to pick up a stray penny in the street. A coin that the public routinely treats as litter is, pretty much by definition, a useless coin. So why should the government keep spending $85 million a year minting coins that are effectively worthless? Other countries, including Canada, Australia, Sweden, and New Zealand have all pulled the plug on their one-cent coins. Presumably the sky wouldn't fall if America followed suit.
Then again, I can see a decent argument for continuing the status quo. Eliminating the penny will necessitate minting more nickels, which, as noted, cost even more to make. Moreover, notes The New York Times, "many states have a sales tax that specifies taxes collected must be rounded to the nearest cent, so they would probably have to modify their laws to accommodate cash purchases." That would mean rounding all prices up to the next-highest nickel. Over time that would cost consumers many millions of additional dollars — even those who never pay for anything with cash.
For now, I remain an agnostic on the question of whether the penny should stay or go. What I do object to is the endlessly flogged but irrelevant observation about a penny's production costs. Scrap the cent or keep it; I don't care. But let the decision be based on sound reasoning, not on gaudy talking points that add nothing to the debate.
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The Massachusetts flag waves on and on
"There are many mysteries in life and one of them is how a state panel convened to design a new flag and seal for the Commonwealth of Massachusetts can spend more than three years and $100,000 yet fail completely to accomplish its mission," I began a column last summer. "An even more impenetrable mystery is why anyone would imagine that the best response to such a failure is to convene yet another government panel and give it another $100,000 to do the same thing."
Did I say three years? Well, now it's four.
Eight months after the Commonwealth's second flag-design panel was authorized and bankrolled, it is only just now getting around to meeting for the first time. According to a story in CommonWealth Beacon by veteran political reporter Gintautas Dumcius, the commission, which is required to submit its final recommendations to Governor Maura Healey by July 29, isn't scheduled to hold its first session until March 20. And even that will be largely futile, since two of the panel's 10 seats — the two to be designated by Secretary of State William Galvin — still haven't been filled. "We have plenty of time," Galvin said when asked to explain the delay. Typical.
 The Massachusetts state flag would not be hard to improve. |
I am not much of a gambler, but I would wager pretty much anything that July 29 will come and go and the commission will be no closer to signing off on a new flag and seal than it is right now. For more than 40 years, there has been talk of changing the Massachusetts insignia, which currently includes an image of an upraised sword above the figure of a standing Algonquian Native American, along with a ribbon bearing an clumsy Latin motto. Changing it is hardly an insuperable challenge, but, as with so much else in the Bay State, politicians would rather talk and posture than actually get something done.
Which is why last year I proposed what I thought was an elegant, unfussy solution to the endless grumbling over the state flag: Eliminate the sword and the banner and retain the rest. That would leave Massachusetts with a truly beautiful flag — the golden figure of a Native American with his bow in the center of a dark blue shield, set off against a field of white. That would retain a strong connection to the traditional emblem, while excising those elements that many find distressing or anachronistic.
The most visually arresting flags are graphically simple, unique in their design, limited to just two or three colors, and free of words. That is what makes the flags of Alaska, New Mexico, and South Carolina so captivating, while those of most other states are forgettable. A Massachusetts flag depicting only a standing Algonquian would be memorable and appealing, and a great improvement over what the Commonwealth has now.
I also invited readers to suggest other flag ideas, several of which I presented in a follow-up column. (Read it here.) Nearly all of them incorporated one or more elements with deep roots in Massachusetts history, such as the pine tree, the codfish, or the Mayflower. The experience convinced me that if the job of refashioning the state's flag were turned over to an assembly of ordinary Massachusetts citizens, they would have little trouble generating thoughtful ideas and wouldn't need to spend hundreds of thousands of dollars or spin their wheels for years on end before reaching a satisfactory conclusion.
It took less than a year to develop the COVID-19 vaccine. The Empire State Building was built in just 13 months. During the summer of 1788, Wolfgang Amadeus Mozart composed his three greatest symphonies. In only 18 months, Isaac Newton developed the scientific foundation of optics, invented the mathematical discipline of calculus, and formulated the theory of gravity. From start to finish, the Manhattan Project required 3½ years to develop an atomic bomb.
Massachusetts politicians, meanwhile, have had more than four years to redesign a flag and are no closer to getting the job done than they were at the outset. If even something so simple is more than they can handle, why do we ever entrust them with things that are important?
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Going on hiatus
A programming note: Arguable will be taking a break. To date I have had the good fortune never to require an extended hospital stay. But that streak is about to end: I am scheduled for major surgery in a few days. Consequently, this will be the last newsletter for a while. If the good Lord's willing and the creek don't rise, Arguable should be back in your inbox by June. Enjoy the return of spring, and I look forward to rejoining you soon.
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What I Wrote Then
25 years ago on the op-ed page
From "A world full of unsettling messages," March 13, 2000:
I never forget that the character of the man you will be tomorrow depends in great part on the kind of father I am today. I thought that was a huge responsibility when you were an infant. Now that you are a boy, with a mind and will of your own, I am beginning to grasp how huge it really is.
All my love,
Papa
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The Last Line
"LADY BRACKNELL.
My nephew, you seem to be displaying signs of triviality.JACK.
On the contrary, Aunt Augusta, I've now realized for the first time in my life the vital Importance of Being Earnest." — Oscar Wilde, The Importance of Being Earnest (1895)
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Jeff Jacoby is a columnist for The Boston Globe.
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