Under the legislation proposed to the House by (Rep. Jim) Kolbe, all cash transactions would be rounded to the nearest nickel. The bill, known formally as the Currency Overhaul for an Industrious Nation (COIN), would also gradually phase out the dollar bill in favor of a dollar coin and restructure the bureaucracy of the U.S. Mint.Getting rid of the dollar bill for a coin is a good idea, though in true Republican fashion, Kolbe can't just do it - which guarantees Americans will hate and ignore the dollar coin just like its last three iterations. There was an old joke that if the Dems wanted to burn down the library of Congress, the GOP would agree but insist that it be phased in over three years. Their inclinations haven't changed a bit since Gerald Ford was the face of the party.
But what bothers me is the heavy-handed federal law requirement that all transations be rounded. Why does it need to be a law, which must come with a bureau to monitor it, police to enforce it, and courts to punish it? Is there currently a law that all transactions be rounded to the cent? If not (and "not" is the correct answer) how does the nation manage to survive gas priced in tenths of a cent without Kolbe and his law there to tell us how to buy and sell? The government should simply stop minting cents and when they are gone (which will take a period of several years) they are gone. Most stores will re-price, but no one will be forced to.
But what would we use for cents if a store insisted that something cost $1.04? I don't know, maybe aluminum can tabs, small rocks, printed coupons, coat buttons, who cares what? No one would have to accept them, but it would be in their best interest to do so. The amazing thing about freedom is that a standard would come into use before the pennies ran out because when people need to do something, they usually manage it. Where do you think coins came from in the first place? They are not the invention of government.
I would be perfectly happy to see an extra-legal, voluntary cent, just like I'm glad to see extra-legal, voluntary currencies like the Liberty Dollar. The government has screwed up our money enough, the more we avoid their coercive solutions the happier we'll be in the long run.
Will it be messy? Probably for a while. So what? One thing Americans have never lacked is creativity in dealing with conundrums. I'm pretty sure we can solve our penny problem without a federal law and probably even without pennies.