MONEY isn't worth what it used to be, or so the inflation index would indicate, but as far as the change in your pocket is concerned, some of it is worth more.
The price of certain metals has skyrocketed in recent years: copper and nickel are up three-fold in value since 2003, while zinc has quadrupled.
Zinc? Yep, the jingle in your purse is not just from copper and nickel, and as for silver and gold coins, there haven't been any of those in general circulation in decades. Instead, according to the Associated Press, the copper penny is actually 97.5 percent zinc, while nickels are made up of three-quarters copper and only one-quarter their namesake metal. Dimes, quarters, and half-dollars are also nickel-copper combos, with copper making up more than 90 percent of the mix.
The result has been that a penny now costs 1.26 cents to produce (the good news is that's actually down from a high of 1.67 cents just a few months ago), while a nickel currently costs about 7.7 cents (also down from a high of nearly a dime). Rising commodity prices have affected dimes and quarters as well but so far they still cost less to make than their face values.
Still, Rep. Luis Gutierrez (D., Ill.) says the Treasury lost $100 million last year alone minting 7.4 billion pennies and 1.2 billion nickels. That got Congress thinking - always a dangerous prospect - and the result was a bill passed by the House on Thursday that would require both coins to be made primarily of steel, a much less expensive metal.
The bill may face some tough sledding, however, because Congress flexing its constitutional authority over the nation's currency tends not to sit too well with the folks at 1600 Pennsylvania Ave. Mint Director Edmund Moy's reaction was tepid and there's talk of a more White House-friendly version of the legislation in the Senate.
A partial solution would be to let the one-cent coin go the way of the two-cent, three-cent, double eagle, and other discontinued coins. But ending production doesn't sit well with the general public, which has an almost nostalgic attachment to these representatives of a time when phrases such as "penny candy" and "penny for your thoughts" had real meaning.
That being the case, changing the coins' composition likely is the best solution and should be pursued quickly so that the Treasury can stop what it's currently doing: throwing good money after bad.