The Trump admin says pennies don’t make cents
Image: Getty
On Sunday, President Trump ordered the US Treasury to stop minting new pennies, citing the coin’s high cost of production as wasteful government spending.
His order echoes previous comments from the Department of Government Efficiency (DOGE), which expressed displeasure with the costs associated with pennies and called for the coins to be phased out of circulation.
- The cost of penny production rose 20% last fiscal year to reach 3.7 cents per penny, according to the US Mint.
- The US government sustained $85.3 million in losses on the nearly 3.2 billion pennies produced in FY 2024.
Americans share their two cents
Trump’s move revives a longstanding debate about whether the US government should eliminate the penny – a plan that’s been proposed in Congress several times in recent years, but has never progressed far.
- Proponents argue the cost savings would be worth any added hassle, pointing to Canada, which stopped producing pennies in 2012, as an example. They also note that less than 20% of all transactions in the US are by cash, meaning any negative impact will be limited.
- Opponents say abolishing the coin would add more complications for both merchants and consumers, since cash transactions would need to be rounded to the nearest nickel. Some economists argue this would largely raise prices across the board, since they’re typically slightly below round numbers (e.g., $0.99).
In the know: A 2023 study from the Federal Reserve Bank of Atlanta found eliminating the penny wouldn’t pose any “significant inflationary consequences" and would only slightly decrease the hassle of exchanging cash.
Looking ahead…It's unclear whether Trump’s order to halt penny production would survive a potential legal challenge (though none have emerged yet). The Constitution provides Congress with authority over coinage and currency regulation, but the Treasury Secretary has some discretion in the minting of coins.
đź“Š Flash poll: Do you think the US government should stop minting pennies?
See a 360° view of what pundits are saying →
Sprinkles from the Left
- Some commentators argue that nickels are actually far more expensive to make than pennies and that the only reason pennies are being targeted specifically is because the US makes significantly more of them per year.
- Others contend that America is gradually transitioning into a fully digital economy anyway and that cash may soon be obsolete, but much care needs to be taken to ensure its safe implementation.
- “Making pennies is a money-loser. Making nickels is worse.” –Philip Bump, Washington Post
- “Penny dreadful? America slowly makes its move to a cashless economy.” –Philadelphia Inquirer Editorial Board
- “Elon Musk is right: Let’s ditch the penny.”–Linda J. Bilmes, Boston Globe
Sprinkles from the Right
- Some commentators argue that the penny lost its practical use a long time ago when the production costs exceeded its value. With people using pennies and other small change less and less, it is high time to examine whether they are needed in the near future.
- Others contend that eliminating the penny will still require fundamental changes to our economic system and how businesses charge for goods. They also suggest that Trump and Congress must formulate a plan together to make this system as efficient as possible.
- “Minting U.S. coins costing a pretty penny.” –Telegraph Herald Editorial Board
- “Trump and Musk have pennies in their sights. On that we can agree.”–Chicago Tribune Editorial Board
- “Opinion: Social Security and Medicare burn while Trump counts pennies.” –Brett Arends, MarketWatch
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