Another way to go broke
It costs the government $134 million to make $80 million worth of pennies.
…a field trip to the US Mint and found out that to make $80 million worth of pennies, it costs the government $134 million. And to make around $60 million in nickels costs $124 million. The US Mint says this is because the prices for nickel, zinc, and copper have shot up a lot in the past few years. [snip]
Another reason the politicians shouldn’t be allowed to run the government.
Archived in: Congress, Deficits, US MintsFebruary 11, 2008 at 6:29 pm | Trackback
2 comments
A long-ago business involvement of mine required brass by the coil (roll), some tubing and bar, and flat stock. Brass is simply copper and zinc in different proportions depending on its use. Bronze is copper and tin, which is what pennies are made of. The tin is the hardener; there is very, very little copper in a penny.
Copper prices (it’s a commodity) vary a great deal, from almost nothing to a lot. In the 80’s we thought fibre optics and other means of conveying energy would kill the copper market, which it did - for a while - still, copper use today is, I believe, much lower than twenty years ago.
The penny cost, in my opinion, can’t be in the material cost, but in the other extravagant waste habits of Uncle Sam. The dies for hammering out a penny have been amortized, and the sheet can’t cost very much. The mints are making a mint.
Since 1982, all pennies are aluminum with an applied copper exterior. (All coins are alloys now) The dies are t new each year, in order to produce a sharp clean image. (For proof strikes, special dies and polished planchets are used)
Inflation and commodity prices affect the actual minting costs. Recovering the cost of minting would require floating the value of the coinage to the commodities. I don’t think we want that, which produces nickels worth more than quarters and pennies valued at dollars.