Pennies may soon be a thing of the past. In a post on Truth Social yesterday, President Donald Trump called for a stop to the production of the 1-cent coins.
“For far too long the United States has minted pennies which literally cost us more than 2 cents,” Trump said. “This is so wasteful! I have instructed my Secretary of the US Treasury to stop producing new pennies. Let’s rip the waste out of our great nations budget, even if it’s a penny at a time.”
According to JM Bullion, producing a penny costs over 3 cents, which cost the government $179 million in 2023.
The amount may seem small compared to the trillions of dollars in government spending each year, but it adds to the spending cuts made by Trump and Elon Musk in the Department of Government Efficiency. If the federal government can eliminate $179 million in needless spending, it should seek to do so.
This is not the first time the penny has cost more to make than it is worth. In 1982, as the cost of copper increased, the U.S. Mint switched the penny’s composition from bronze to copper-plated zinc. Production costs, however, have exceeded the penny’s face value for the last 19 years.
If eliminated, pennies would likely remain legal tender, at least for a few years, as the country transitions away from the coins.
Congress could block Trump’s plan, citing that it has the power to control the coinage of money and determine its value. Congress has tried and failed several times to pass a bill that eliminates the penny.
Trump’s order, however, would not stop the production of money. The Treasury could easily make up the additional value by producing additional dimes or quarters, both of which cost less than face value to make. According to APMEX, at 5.3 cents each, a dime costs just slightly more to produce than a penny.
Also, according to federal law, the Treasury has the power to issue coins necessary for the United States’s needs. Treasury Secretary Scott Bessent could likely deem the penny unnecessary and halt production.
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If the penny were eliminated, it would not have a major effect on prices, as costs, at least for cash transactions, would be rounded up or down to the nearest nickel.
Trump’s action starkly contrasts with the congressional inaction of the last two decades. Although pennies have a nostalgic value, they are ultimately a waste of government money that could be better spent elsewhere.