In a surprising move announced on Sunday, President Trump revealed that the United States would halt the production of pennies, ending a 233-year-old tradition.
USA Today reported that Trump's decision was driven by the exorbitant cost of producing the penny, which has long surpassed its actual monetary value.
The history of the penny dates back to 1792 when it was first minted in the United States. Over the years, the small copper coin transformed into a cultural and historical icon.
Despite its rich history, the penny's production cost has steadily climbed, leading to a reevaluation of its continued minting.
The announcement was made by President Trump after attending the Super Bowl in New Orleans. He took to his Truth Social platform to share the news, emphasizing the wastefulness of penny production.
“For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!” he stated, highlighting the financial inefficiency of maintaining the coin in circulation.
The financial burden of producing pennies has been a subject of scrutiny since Trump assumed office. The previous fiscal year illuminated this issue, as taxpayer dollars funded the production of 4.5 billion pennies at a cost of over $179 million. When broken down, this equated to more than 3 cents per penny produced, an economically unsustainable figure.
In President Trump's words, “I have instructed my Secretary of the US Treasury to stop producing new pennies.” This directive signals a fundamental shift in U.S. monetary policy aimed at reducing what he referred to as budget waste.
The expense associated with minting pennies has seen a notable increase in recent years. For fiscal year 2024, the production cost per penny escalated to approximately 3.7 cents. This 20% rise was primarily due to climbing prices of essential materials like zinc and copper, which are key components of the penny.
This rising cost of materials has reinforced Trump's decision. It underscores the pressing need to address financial inefficiencies rooted in outdated practices.
Furthermore, by phasing out the penny, the United States aligns with several international communities that have already taken similar steps. Nations such as Canada stopped minting their corresponding one-cent coin back in 2012, and Australia made a comparable decision in 1992 with their one and two-cent coins.
Despite the decisive directive from President Trump, eliminating the penny from American currency circulation may not be entirely straightforward. Such a change potentially requires the approval of Congress, introducing an element of unpredictability into the timeline of this transition.
The President framed the move as part of a broader campaign to eliminate waste from the national budget. “Let’s rip the waste out of our great nation budget, even if it’s a penny at a time,” he declared in his Truth Social post. This narrative of fiscal responsibility may play a crucial role in garnering legislative support.
Public support for the cessation of penny production remains to be fully gauged. The penny holds sentimental value for many Americans, manifesting in frequent public debates about its merit and persistence as a piece of U.S. currency.
The penny has long occupied a cherished spot in American culture. Frequently seen as a symbol of economic humility, it has also been the focus of various grassroots advocacy efforts aimed at preservation or elimination.
Regardless of public sentiment, the rising costs present an undeniable economic challenge. With every new penny minted costing taxpayers significantly more than its face value, the decision to halt production could be seen as a fiscally responsible move.
