(Photo: REUTERS/Larry Downing)U.S. President Barack Obama walks on the South Lawn of the White House in Washington, February 15, 2012.
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President Obama has made several money-saving plans for the country, and one specifically targets the change in your pocket.
Obama, along with the Treasury Department, announced the 2013 budget plans on Tuesday. One provision calls for the Treasury to reduce the cost of making pennies and nickels. On average, "the costs of making the penny and the nickel are more than twice the face value of those coins," said the Treasury.
Last year saw the production of over 4.3 billion pennies and 914 million nickels. Lowering the cost of production would save taxpayers more than $75 million annually. Obama and Vice President Biden asked the Treasury to cease making the dollar coins in Dec., and that will lead to a savings of $50 million alone.
"The Mint's primary cost driver is the price of metal, a factor over which it has no control. Daily spot prices of copper and zinc, the Mint's two main metallic materials, have fluctuated in excess of 400 percent, and the price of nickel by 500 percent over the past 10 years," noted analyst Joe Weisenthal.
Pennies and nickels have notoriously cost more than they are worth. Pennies, on average, cost 2.4 cents to make, nearly two and a half times their value. In 1982, the Treasury switched from using pure copper to using copper plating. Since then, the penny has gone through several changes. The Treasury actually produced steel pennies during World War II but discontinued them after the war.
Nickels cost 11.2 cents to make, again nearly two and a half times their worth. They are more expensive because they use a combination of 75 percent pure copper and 25 percent nickel. The Treasury has been aware of the growing cost of these coins and has explored other solutions, with no success.
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Everyday citizens, though, support the idea of making cost-effective coins. "You can't fix [the] deficit when it costs us more to make money than the face value," tweeted Ned Campbell. Aaron Tainter suggested: "Get rid of the penny altogether."
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