Democracy Gone Astray

Democracy, being a human construct, needs to be thought of as directionality rather than an object. As such, to understand it requires not so much a description of existing structures and/or other related phenomena but a declaration of intentionality.
This blog aims at creating labeled lists of published infringements of such intentionality, of points in time where democracy strays from its intended directionality. In addition to outright infringements, this blog also collects important contemporary information and/or discussions that impact our socio-political landscape.

All the posts here were published in the electronic media – main-stream as well as fringe, and maintain links to the original texts.

[NOTE: Due to changes I haven't caught on time in the blogging software, all of the 'Original Article' links were nullified between September 11, 2012 and December 11, 2012. My apologies.]

Thursday, December 20, 2012

Nixing penny saves $7M less annually than promised

Getting rid of the penny isn't going to save taxpayers as much as the federal government indicated in the March budget.

When Finance Minister Jim Flaherty announced the impending withdrawal of the penny, he said the government would save $11 million a year in production costs.

That's because it costs about 1.6 cents to make each one-cent coin.

But a new analysis of costs, released today, shows that taxpayers will likely only see a savings of about $4 million each year over a six-year period.

That's because it will cost about $38.3 million to redeem some six billion pennies over that same six years.

Here's how the math works.

It's expected to cost $53 million to pay the banks for the face value of the coins, as well as another $27 million in handling and administration costs by the Royal Canadian Mint.

Recycling the zinc and copper from melted-down pennies will bring in about $42.5 million in revenue, leaving the government in the red at just over $38 million.

Adding the $11 million in annual savings from not minting any more pennies gives the government annual savings of almost $4 million per year.

The mint stopped making the coins in May and will stop distributing pennies to financial institutions as of Feb. 4, 2013.

Original Article
Source: CBC
Author: CP

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