Posted on 02/10/2025 11:33:30 AM PST by Red Badger
In a move potentially foretold by the Department of Government Efficiency (DOGE), it seems the U.S. could be on the verge of ending penny production.
President Donald Trump on Sunday said that he had asked the Treasury Department to stop minting new pennies, calling them “wasteful.”
“For far too long the United States has minted pennies which literally cost us more than 2 cents. 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,” Trump wrote on Truth Social.
But is the penny really wasteful? Here’s what to know.
How much does a penny cost? Technically, Trump underreported how much the U.S. spends to mint a single penny.
The average cost to make one penny rose to 3.69 cents in the last fiscal year, marking the 19th consecutive year the coin has “remained above face value,” per the latest U.S. Mint report. The increased price could be attributed to the 5.4 percent increase in copper price per tonne noted by the Mint — pennies are mostly zinc but with a copper plating. (Zinc prices dropped nearly 5 percent between fiscal year 2023 and fiscal year 2024, according to the Mint report.)
There have been efforts to make the penny cheaper to produce. Ed Moy, 38th director of the U.S. Mint, explained during a 2022 conversation that even using a cheaper metal, like steel, would be ineffective. Plastics and polymers would also prove difficult, especially when put into coin-counting machines that look for metals.
Are we “losing money” on other coins? According to the U.S. Mint, producing nickels has also remained above face-value for nearly 20 years. In fiscal year 2024, it cost nearly 14 cents to make the five-cent piece.
Across the other coins — the dime, quarter, and half-dollar — the situation is much better.
Per the latest U.S. Mint report, it costs less than six cents to make a dime ($0.0576). To make a quarter, it cost about 15 cents ($0.1468), and nearly 34 cents for a half-dollar ($0.3397).
These prices are up over previous years, however. Since 2022, the costs of producing a single dime, quarter, and half-dollar has increased by $0.0073, $0.0357, and $0.1682, respectively.
Penny costs have increased by $0.0097 since 2022, while nickel costs have increased by $0.0337.
Why do we still have the penny, then? There are a number of reasons, experts say.
There’s the practicality of the one-cent piece. While you’re likely using cash less, when you do, you expect to receive the exact change you are owed. Without pennies, it would be difficult to, say, give you change on a $19.87 purchase if you pay with a $20.
It could also impact those who do not use credit or debit cards and instead rely on cash and coins. In its 2023 survey, the Federal Deposit Insurance Corporation (FDIC) found that roughly 4 percent of households — or about 5.6 million households — were unbanked. That means they did not have a checking or savings account with a bank or credit union, which could indicate their reliance on cash and coins, like the penny.
It’s also difficult to make changes to our money.
Under the Constitution, Congress is responsible for regulating the Federal Reserve and overseeing our money. Moy noted in 2022 that it’s “hard to get things through Congress.” He said it’s partially because the Mint brings in money.
“Even though you’re losing $80 million a year on one single product line, $80 million is a pittance compared to a $4 trillion budget,” he explained, adding that while money is lost on the penny, there’s profit in the quarter and dollar coin which “more than outweigh whatever losses our coins are.”
While speaking with Moy, Philip Diehl, the 35th director of the U.S. Mint, noted there is also interest from lobbyists representing those who manufacture the zinc used to make pennies, for example.
Congress has tried to tackle the penny problem in recent years. In 2020, bipartisan bills were introduced in the House and Senate that would have given the Mint the power to “alter the composition of circulating coins to reduce the cost of manufacturing them,” the Federal Reserve Bank of Richmond explains. Both bills failed to pass. Similar bills were introduced in 2023, though they met the same fate.
There could also be consequences of the penny no longer being minted.
In a 2022 report from the Federal Reserve, officials warned that “drastically reducing or ending the production of the penny” could lead to a “significant flowback of coin from consumers and businesses seeking to turn in their pennies.”
The same report suggested, however, that reducing penny production could save the Mint up to $100 million annually.
It is unclear whether Trump has the power to unilaterally eliminate the lowly one-cent coin. Currency specifications, including the size and metal content of coins, are dictated by Congress.
But Robert K. Triest, an economics professor at Northeastern University, has argued that there might be wiggle room.
“The process of discontinuing the penny in the U.S. is a little unclear. It would likely require an act of Congress, but the Secretary of the Treasury might be able to simply stop the minting of new pennies,” he said last month.
I never handle coins. Haven’t seen a penny in 10 years.
Modern coin counting and rolling machines are brutal. I find 60 year old nickels that are in better shape than some that are 5 years old.
I wouldn’t bee too sure about that.
I have had cashiers give me back all my change plus some when I gave them extra in order to get back whole bills.............
Collectors items if production of them ends.
what about ha’ pennies?
come clean out my couch
Larry Niven and Jerry Pournelle suggested using spent fuel rods. The benefits are as follows:
Nobody would hoard the coins in an effort to avoid critical mass
Pending bank robbers would be easy to spot due the the lead suit
Payments for international debt could be delivered by ICBM
I can't remember the others.
That’s worth less than nothing!............except to a numismatist!.........
Just another step in getting rid of cash and moving us into a cashless society where they can track everything.
Yeah—I thought about that but the numbers don’t lie.
We are taking a bath on pennies and nickels.
If you lose your coins you can find them with a Geiger counter, or wait till night time and they will glow in the dark.............
Pennies currently are made of copper plated zinc. idk how much of the cost is due to materials, I would guess not much.
Yeah! Was that in “A Step Farther Out”?
I can’t remember, I’ve read so much!...................
Doing away with fractional dollars poses a question. Does $1.50 (for instance) increase to $2 dollar or does it decrease to $1.00 ?
Two for three dollars?
Doesn’t matter. That’s an excuse. We have had a hundredth of ac dollar since the nation started. The government destroyed the value of the dollar till 96% if it’s buying power is gone, then they tell us they want to drop the penny.
Be honest and explain that a dollar is roughly the same as 3 cents before the federal reserve and that they need to devalue the currency.
I am a business guy.
Saving cash is saving cash.
I leave theory to the theorists.
No more deceptive “Just $1.99” pricing.
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