For a long time I have opposed single letter variable names. Often I see code which has a variable for a fixed purpose with a single letter name, EG “FILE *f;“, the problem with this is that unless you choose a letter such as ‘z‘ which has a high scrabble score (and probably no relation to what your program is doing) then it will occur in other variable names and in reserved words for the language in question. As a significant part of the time spent coding will involve reading code so even for programmers working on a project a useful amount of time can be saved by using variable names that can easily by found by a search program. Often it’s necessary to read source code to understand what a system does – so that is code reading without writing.
With most editors and file viewing tools searching for a variable with a single character name in a function (or source file for a global variable) is going to be difficult. Automated searching is mostly useless, probably the best option is to have your editor highlight every instance and visually scan for the ones with are not surrounded by brackets, braces, parenthesis, spaces, commas, or whatever else is not acceptable in a variable name in the language in question.
Of course if you have a syntax highlighting editor then it might parse enough of the language to avoid this. But the heavier editors are not always available. Often I edit code on the system where the crash occurs (it makes it easier to run a debugger). Installing one of the heavier editors is often not an option for such a task (the vim-full Debian/Lenny package for AMD64 has dependencies that involve 27M of packages files to download and would take 100M of disk space to install quite a lot to ask if you just want to edit a single source file). Incidentally I am interested in suggestions for the best combination of features and space in a vi clone (color syntax highlighting is a feature I desire).
But even if you have a fancy editor, there is still the issue of using tools such as less and grep to find uses of variables. Of course for some uses (such as a loop counter) there is little benefit in using grep.
Another issue to consider is the language. If you write in Perl then a search for \$i should work reasonably well.
One of the greatest uses of single letter variable names is the ‘i‘ and ‘j‘ names for loop counters. In the early days of computing FORTRAN was the only compiled language suitable for scientific tasks and it had no explicit way of declaring variables, if a variable name started with i, j, k, l, m, or n then it was known to be an integer. So i became the commonly used name for a loop counter (the first short integer variable name). That habit has been passed on through the years so now many people who have never heard of FORTRAN use i as the name for a loop counter and j as the name for the inner loop in nested loops. [I couldn't find a good reference for FORTRAN history - I'll update this post if someone can find one.]
But it seems to me that using idx, index, or even names such as item_count which might refer to the meaning of the program might be more efficient overall. Searching for instances of i in a program is going to be difficult at the best of times, even without having multiple loops (either in separate functions or in the same function) with the same variable name.
So if there is to be a policy for variable names for counters, I think that it makes most sense to have multiple letters in all variable names to allow for easy grepping, and to have counter names which apply to what is being counted. Some effort to give different index names to different for/while loops would make sense too. Having two different for loops with a counter named index is going to make things more difficult for someone who reads the code. Of course there are situations where two loops should have the same variable, for example if one loop searches through an array to find a particular item and then the next loop goes backward through the array to perform some operation on all preceding items then it makes sense to use the same variable.