The E-Sylum:  Volume 10, Number 48, November 25, 2007, Article 19


[David Sundman forwarded this article from the U.K.'s
Guardian newspaper. -Editor]

'I don't think people on either side of the till would
lament the passing of the 1p and 2p,' says Matthew Knowles,
spokesman for the Federation of Small Businesses. 'Some
people might worry that an item that's currently 99p would
be rounded up, but changing that to a pound isn't going to
cause too much of a problem. Handling small coins is time-
consuming, and with the disappearance of bank branches and
post offices there are fewer places to deposit cash. Many
of our members would be glad to see them go. It would make
life a lot easier.'

As prices rise across the world, low-denomination coins
are coming under increasing threat. Australia and New Zealand
abandoned one- and two-cent coins in the 1990s, and last
year the fearless Kiwis got rid of the five-cent piece as
well  and there is no evidence that the move has been
inflationary, or that shoppers have been inconvenienced.
The cent is also under attack in the US and Canada, and
in some parts of Euroland, with businesses arguing that
transactions are speeded up if small denominations are

'Are these people crazy?' said one respondent. 'I'd like
to see the inflation rate when we do that.' Another wondered
where you would stop. 'After a few years the same people would
moan, 'What about the 5p? It doesn't buy anything.'' And a
man in Gateshead invited all the 'shrapnel'-hating Londoners
to send their coppers to him. (What an ugly, self-satisfied
term 'shrapnel' is when applied to loose change: there are
parts of the world where this shrapnel is what you'd get
for a day's work.)

It may be like voting Conservative: what people tell pollsters
they do with low-denomination coins and what they actually
do may be two different things. 'People love them and hate
them at the same time,' says Catherine Eagleton, curator
of modern money at the British Museum.

Keith Cottrell, director of sales at the Royal Mint, is
also sceptical of suggestions that people in the UK can
no longer be bothered with low-denomination coins. 'In
Italy and elsewhere in Europe, people rarely wait for their
small change,' he says, 'but here they almost always do.'
We may put coins in charity boxes, collect them in jars for
a rainy day and then forget about them, ignore them if we
see them lying in the street, but he's unwilling to believe
we have yet reached the stage where we are deliberately
throwing them away.

Whether they survive or not, one thing is certain  coppers
are not what they were. Both at the Mint and on a tour of
the vast coin collection at the British Museum, I was shown
a 2d piece dating from 1797  a monster coin actually made
of copper, unlike today's copper-plated steel imitations,
and weighing two ounces. (The 'd' in 2d stands for denarii,
the plural of denarius, which was a Roman coin. That we
were still using a Roman-derived abbreviation in 1971 shows
the remarkable continuity of the pre-decimal coinage.) If
you dislike having to carry today's small change, imagine
being weighed down by a few of those 2d coins. While there
is evidence that many people no longer stoop to pick up
coppers they see in the street, if this was laying on the
pavement you would have to make a detour to get around it.

In 1963, Danny Kaye starred in a film called The Man From
the Diner's Club. It has not left a strong imprint on movie
history, but according to the British Museum's Eagleton it
deserves at least a footnote in financial history. She has
supplied it, too  a picture of the poster for the film
appears in the history of money she has helped co-author
for the museum. It may be the catchline on the poster that
appeals to her: 'The funniest picture since money went out
of style!' Her point is that, 44 years on, money hasn't
gone out of style. Plastic may have been around for half
a century, but cash is far from dead, despite the eagerness
of banks and retailers to kill it off.

Back at the Royal Mint, Cottrell has his own version of
the Danny Kaye story. Thirty years ago, he joined a company
making bank notes and went in on the first day fired with
enthusiasm. It was soon dampened. 'You know you've joined
a dying industry,' said the man charged with doing the
induction. Three decades on, Cottrell is still making a
good living out of cash.

Plastic may gradually be winning the war, but cash is
putting up stern resistance. Cash still accounts for 63%
of all payments by volume; cards overtook cash in value
terms only three years ago; and plastic is not predicted
to overtake cash in volume of transactions until 2014.

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  Wayne Homren, Editor

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