US President Donald Trump has directed the Secretary of the US Treasury to cease production of new pennies, a move aimed at reducing waste within the national budget. The decision comes as a cost-saving measure, addressing the long-standing issue of the penny's production cost exceeding its face value. According to the US Mint's 2024 annual report, minting and distributing a one-cent coin costs 3.69 cents. This recent action, taken by Treasury Secretary Scott Bessent, marks a significant shift in US currency production.
The proposal to discontinue the penny is not new; government officials and members of Congress have suggested similar measures in the past, but without success. However, a recent post by Elon Musk's unofficial Department of Government Efficiency (Doge) brought renewed attention to the financial inefficiencies associated with penny production. Musk's commentary highlighted concerns reminiscent of those that led Canada to eliminate its one-cent coin in 2012 due to similar cost issues and declining purchasing power.
The penny's purchasing power has diminished over time amidst rising prices, prompting this latest response from President Trump. In his Truth Social post, Trump emphasized the necessity of tackling budget waste, articulating his rationale:
"Let's rip the waste out of our great nation's budget, even if it's a penny at a time."
The decision reflects an ongoing focus on fiscal responsibility by addressing areas where expenses outweigh benefits. Despite previous unsuccessful attempts to discontinue the penny, the current administration sees this move as essential for achieving cost savings.
By ceasing penny production, the US aims to align its currency practices with economic realities. The costs associated with producing pennies have long been a subject of debate due to their higher minting expenses compared to their value. As such, this decision represents a strategic effort to streamline government expenditures and promote efficient use of resources.