What Will Beggars Do When No One Carries Loose Change?

The end of money
March 5 2012 6:45 AM

Brother, Can You Spare an E-Dime?

What will panhandlers do when people stop carrying spare change?

Was2778984
Salvation Army bell-ringers, along with panhandlers, will be affected by a shrinking reliance on cash

PAUL J. RICHARDS.

Cash is great, except when you don’t need it. Pay for an $8.17 lunch with a $10 bill, and you’re left to tote around a bill and seven coins the rest of the day. Behavioral economist Dan Ariely calls this the negative utility of loose change: “It’s unpleasant, it’s in your pocket, it takes up space, and you can’t get rid of it.”

Will Oremus Will Oremus

Will Oremus is Slate's senior technology writer.

But your irksome nickel is another’s opportunity: On the subway and the street corner, people are waiting to take that money off your hands. From your perspective, it might be easier to hand over the change to a street performer or charity than to take it home and deposit into your own coin collection.

Just how much cash changes hands in this manner? More than you might think. Consider that more than $40 billion worth of U.S. coins are in circulation. Coinstar, a business built solely to capitalize on the inconvenience of loose change, takes in 50 billion coins a year, worth $3 billion. It estimates another $10 billion is accumulating in the nation’s piggy banks and seat cushions.

Advertisement

Salvation Army bell-ringers collected $148 million in their red kettles last Christmas season alone. UNICEF’s orange Halloween boxes have brought in $164 million since the campaign began in 1950. The company that makes those spiral coin funnels claims that people have dropped more than $200 million into them over the past 25 years, with much of that going to nonprofits and charity.

The New York subway system has some 200 registered buskers, performing 150 shows a week. If the average three-hour show brought in $100, that would amount to almost $8 million a year. That’s not counting the illicit mariachi and break-dancing shows that take place in moving subway cars, let alone all the panhandlers. A survey by the National Coalition for the Homeless, a D.C.-based advocacy group, found that a typical panhandler works one or two three-hour shifts per day, making an average of $31.50 per shift. Multiplying by the estimated number of people actively soliciting on the streets across the country, the coalition estimates that panhandlers take in more than $100 million annually.

A dime here and there is a plink in the bucket for us, but not so for the homeless, the street performers, or the Salvation Army. Yet coins might not be around forever. What will become of the loose-change business model if society goes cashless?

The charities will have an easier time adjusting than the beggars. The Salvation Army has already started working on the problem. It has been accepting donations on the Web for years at OnlineRedKettle.org, and in November it announced that bell-ringers in several cities would start using mobile phones equipped with Square readers, allowing for in-the-field giving via credit card. UNICEF’s orange boxes have also started accepting smartphone donations via scannable Microsoft Tag codes.

These organizations are clearly equipped to accommodate electronic donations. The more pressing question for Salvation Army et al. is whether people will give as much when they don’t have change jingling in their pockets. Not only do credit-card transactions take longer, the money comes straight from our bank accounts, so there’s no sense that we’re giving away something we wouldn’t use otherwise. It’s also unclear that people get the same “warm glow of giving” from electronic transfers, says Ariely, who wrote about the psychology of money in his book Predictably Irrational.

TODAY IN SLATE

Sports Nut

Grandmaster Clash

One of the most amazing feats in chess history just happened, and no one noticed.

The Extraordinary Amicus Brief That Attempts to Explain the Wu-Tang Clan to the Supreme Court Justices

Amazon Is Officially a Gadget Company. Here Are Its Six New Devices.

Uh-Oh. The World’s Oceans Have Broken Their All-Time Heat Record.

The NFL Explains How It Sees “the Role of the Female”

Future Tense

Amazon Is Now a Gadget Company

Food

How to Order Chinese Food

First, stop thinking of it as “Chinese food.”

The NFL Should Lose Its Tax-Exempt Status, Which It Never Should Have Had Anyway

The Country Where Women Aren’t Allowed to Work Once They’re 36 Weeks’ Pregnant

The XX Factor
Sept. 18 2014 11:40 AM The Country Where Women Aren’t Allowed to Work Once They’re 36 Weeks’ Pregnant
Moneybox
Sept. 17 2014 5:10 PM The Most Awkward Scenario in Which a Man Can Hold a Door for a Woman
  News & Politics
Politics
Sept. 18 2014 6:52 PM Ground Zero for the Fight Over Female Voters  Colorado Democrats and Republicans are testing theories for reaching women that will resonate far beyond the Rocky Mountains.  
  Business
Moneybox
Sept. 18 2014 6:02 PM A Chinese Company Just Announced the Biggest IPO in U.S. History
  Life
Outward
Sept. 18 2014 4:15 PM Reactions to a Sketch of Chelsea Manning Reveal Transmisogyny
  Double X
The XX Factor
Sept. 18 2014 3:30 PM How Crisis Pregnancy Centers Trick Women
  Slate Plus
Behind the Scenes
Sept. 18 2014 1:23 PM “It’s Not Every Day That You Can Beat the World Champion” An exclusive interview with chess grandmaster Fabiano Caruana.
  Arts
Brow Beat
Sept. 18 2014 4:33 PM The Top 5 Dadsplaining Moments From The Cosby Show
  Technology
Future Tense
Sept. 18 2014 6:48 PM By 2100 the World's Population Could Be 11 Billion
  Health & Science
Science
Sept. 18 2014 3:35 PM Do People Still Die of Rabies? And how do you know if an animal is rabid?
  Sports
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.