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What’s the Point of Loose Change?

Obsolete pain in the ass or a necessary burden for modern society? Let’s find out.

What the hell can you actually buy with less than a buck these days? It’s not a rhetorical question: Lots of people apparently wanna know, because a quick Google search reveals numerous websites that actually list the sort of shit you can get for less than a dollar. (tl;dr: Don’t hold your breath for anything good, unless you’re in the market for temporary tattoos, cheap, colorful scissors or a whoopee cushion.)

Which begs the question: What’s the deal with coins? Do we still need them? What are they good for? What are you supposed to do with them? Are we gonna get rid of them anytime soon? Join us on our mission of loose-change discovery, then grimace at how nasty and metallic your fingers smell afterwards.

So what can I do with all my coins, besides buy cheap crap of questionable utility?
There are still a lot of things that take coins (and sometimes only coins): Laundromats, vending machines, parking meters, things like that—the unsung, automated marvels of modern living, you might say. Even many of those, however, are switching to accepting credit cards, or their own proprietary cards. Still, keeping loose change in the car is a good idea, only because few things in life suck worse than a parking ticket.

The most common advice, though, is to save it, piggy-bank style. Once your container gets heavy, you can cash it in every few months, or every year, for whatever: Your coffee money, one trip of grocery shopping, a nice bottle of booze, or whatever you want it to be (maybe several dozen temporary tattoos and whoopee cushions?).

Converting all that change into money, though, is another thing. You can take it to the bank, but usually you have to be a customer of that bank, and often you’ll have to put them in rolls yourself. Tellers don’t always count individual coins anymore. You can also dump it in those coin-counting machines you see at supermarkets and elsewhere, though they take a cut themselves for the hassle.

Another option is to donate it. Usually those coin-counting machines give you the option of donating to various charities, if that’s your thing. Every little bit helps, right?

Why do we even bother still making coins?
It’s not a crazy question. For a previous story on how much cash you should carry with you at all times, I asked everyone I knew for several weeks how much cash they had on them (while assuring them that I wasn’t about to rob them). I was shocked at how many people don’t even carry a dollar, ever! And if they can’t be bothered to carry small paper notes on their person, there’s no way in hell they’re gonna lug around a bunch of metal. So why are they still made in this age of plastic swiping and inserting?

I contacted the U.S. Mint, which makes all coinage for the U.S. Treasury, for an answer. According to a spokesman, coins “remain important instruments for settling financial transactions.” In other words, stores need to make change: If you live in a state with sales tax, you often end up with an array of coins back when you pay cash for things. No way around that, unless each store wants to calibrate its prices according to the tax of the land so that each purchase ends on a nice, round dollar figure.

I’d gladly round up to the nearest dollar to avoid getting change. What would a true coinless society look like, anyway?
Let’s ask South Korea! They’re doing away with coins altogether, and will be totally coin-free by 2020. They’re going to do it by giving back change in a completely different way: It’ll be added back onto your credit card, or a transportation card, or other kinds of mediums. Sounds clever, but the larger goal, they say, is a cashless society—which is kind of spooky and new world order to some people.

How so?
Well, credit is offered by private companies—they’re the ones getting rich when you use your card, as it involves a service, and thus, a fee. We all end up paying for credit eventually, when the service fee that stores have to pay gets baked into the cost of stuff. Credit is sold as a means of convenience. Meanwhile, no one really has any incentive to promote cash. Though when you think about it, as this article says, it’s pretty amazing! Cash can be given by anyone, accepted by anyone, settled and cleared instantly, according to the very smart person they quoted.

That brings us to the matter of access. Anyone can carry cash. But credit—or even a normal bank account—isn’t attainable by everyone. Then when they try to pay for things (bills, etc.) they get gouged by ridiculous money order fees—altogether some of the many ways, poverty advocates say, that the poor stay poor. And China (of course!) is doing some really scary shit with credit, commingling it with citizen profiles to create a sort of “social credit,” whereby your ranking in society is determined by a score. It goes way beyond how quickly and thoroughly you settle your debts. Got friends with low scores? Your score will plunge. Been a bad boy? You may not qualify for travel visas and other basic rights. And good luck getting a decent job. All in all, it’s shaping up to be the stuff of totalitarian nightmares.

Finally, there are the minor issues in a cashless society of the total loss of privacy (since every transaction is traceable), the obvious potential for hackability, and, oh, currency manipulation. How are those coins looking now?

Well, let’s keep the paper cash. Surely the coins are more effort than they’re worth, though?
They are—the unit costs for the penny and the nickel are currently above face value! The Mint spokesman said that as of July 2018, it currently costs about 2 cents to make a penny and a little more than 7 cents to make a nickel. Overall, in 2017, it cost about $480 million to produce coins. That’s a lot of minting. In fact, that’s 14 billion coins made!

That’s insane.
It’s also not counting all of the special collectors’ coins that they make and presumably sell for a pretty penny (a special edition of which is no doubt for sale as well). Take a look at the U.S. Mint website and notice how much real estate is devoted to these coin collectors, investors or whatever those people are who buy those special coins but don’t actually use them to buy stuff with.

Of course, the mint makes decent money by making other coins for way less than face value. Take a quarter: It currently costs about 9 cents to make, and, well, you know how much it’s worth. Likewise with the dime, which costs less than 4 cents to make as of July 2018.

So maybe the answer is to do away with pennies and nickels?
That would never work, though, with those odd amounts of change you get back for pretty much everything you buy with cash.

Damn, you’re right. So we’re stuck with them?
For the moment. But it’s not all bad: The Mint spokesman pointed out that “U.S. coins are pieces of art that can fit in your pocket. They … also tell the story of many of the people, places and events from American history we all share.” Which, yeah, is kind of a corny, bullshit response, but what the hell, they actually are pretty interesting if you take the time to look at them, rather than just ramming them into a parking meter.

As far as the everyday advantages of coins go, the Mint spokesman asked me to picture a hot, sweltering summer day where I’m stuck outside and there’s a vending machine nearby, and I’m either armed with either a bunch of coins, or nothing smaller than a $5 bill. Although frankly, considering the number of vending machines, parking meters and garages that are starting to go cashless, the Mint may want to come up a better argument pretty soon.