The United States will one day soon, we’re told, cease the production of one cent coins, otherwise known as pennies. Just yesterday, this was confirmed by the Treasury Department – a revolutionary change in American currency policy. This is an important step in responding to increased production costs. Further, it answers the current debates about whether the penny is useful in modern commerce.
In just the past decade, the cost of producing a single penny has increased markedly. It has increased from 1.3 cents to an incredible 3.69 cents! This rise in expense has fueled discussions on the practicality and relevance of maintaining a coin that has been in circulation since 1793. The penny was one of the original coins manufactured by the U.S. Mint. For more than 200 years, it’s continued to be a mainstay of American currency.
In February, former President Donald Trump made his move. He ordered Treasury Secretary Scott Bessent to end the production of pennies, deriding them as “wasteful.” This directive is the latest indication of an increasing public and political frustration with the penny’s value. With cash transactions on the decline, individuals are increasingly using digital payments.
A Treasury spokesperson confirmed the details regarding the cessation of penny production:
“Confirming the WSJ story, the Treasury has made its final order of penny blanks this month and the United States Mint will continue to manufacture pennies while an inventory of penny blanks exists.”
The move closely follows similar decisions by other countries. One of our northern neighbors, Canada, phased out its one cent coin way back in 2012. Canadian officials pointed to the high cost of minting the coins and the loss of purchasing power from inflation as key reasons for their decision. The United Kingdom refrained from minting new coins in 2024, having deemed existing coins sufficient for circulation amid declining cash usage.
The current debate about the penny’s future isn’t a new fight. Economists and policymakers have been debating the idea for years. Critics claim that keeping denominations as low as a penny in circulation has become impractical. They point out that a growing number of consumers have moved onto cashless transactions, making the penny even less relevant in day-to-day purchases.
Even prominent actors—like Elon Musk—have recently cast occasion upon the idea of putting riders at undue risk. In its January post on X, Musk’s unofficial Department of Government Efficiency pointed out the financial cost earned by making one single penny. This move invigorated public discussion on the subject.