As we know, one of the arguments for abolishing the penny (and the nickel) is the high cost of manufacturing them, due to the rising prices of zinc and copper. Congress has tried but not succeeded in passing a law to give the US Mint more flexibility to change the composition of these coins, and now they're trying again.
Surging prices for copper, zinc and nickel have some in Congress trying to bring back the steel-made pennies of World War II, and maybe using steel for nickels, as well.
Copper and nickel prices have tripled since 2003 and the price of zinc has quadrupled, said Rep. Luis Gutierrez, D-Ill., whose subcommittee oversees the U.S. Mint.
Keeping the coin content means "contributing to our national debt by almost as much as the coin is worth," Gutierrez said.
A penny, which consists of 97.5% zinc and 2.5% copper, cost 1.26 cents to make as of Tuesday. And a nickel -- 75% copper and the rest nickel -- cost 7.7 cents, based on current commodity prices, according to the Mint.
On Tuesday, the House debated a bill that directs the Treasury secretary to "prescribe" -- suggest -- a new, more economical composition of the nickel and the penny. A vote was delayed because of Republican procedural moves and is expected later in the week.
Unsaid in the legislation is the Constitution's delegation of power to Congress "to coin money (and) regulate the value thereof."
The Bush administration, like others before, chafes at that.
Just a few hours before the House vote, Mint Director Edmund Moy told House Financial Services Chairman Barney Frank, D-Mass., that the Treasury Department opposes the bill as "too prescriptive" in part because it does not explicitly delegate the power to decide the new coin composition.
The bill also gives the public and the metal industry too little time to weigh in on the new coin composition, he said.
"We can't wholeheartedly support that bill," Moy said in a telephone interview. Moy said he could not say whether President Bush would veto the House version in the unlikely event that it survived the Senate.
Sen. Wayne Allard, R-Colo., who is retiring at the end of the year, is expected to present the Senate with a version more acceptable to the administration in the next few weeks.