President Donald Trump directed to Treasury Department avoid the minting of new pennies citing the rising cost of producing the one-cent coin. Trump announced his decision on Truth Social stating that the US has been minting pennies that cost more than two cents to produce deeming this practice "wasteful". Trump instructed the Treasury Secretary to cease the production of new pennies to eliminate waste from national budget. The move come as part of the Trump administration's effort to cut cost and streamline government operations with Elon Musk's Department of Government Efficiency (DOGE) highlighting the penny's cost as a prime example of wasteful spending.
The US Mint reported losses on penny production for nearly two decades. In 2024 fiscal year the Mint lost $85.3 million on nearly 3.2 billion pennies it produced. The cost to produce each penny was nearly $0.037up from $0.031 the previous year. This "negative seigniorage" where production costs exceed the coin's face value has fueled the debate over the penny's continued use. Advocates for eliminating the penny cite cost savings speedier checkouts at cash registers and the fact that several countries such as Canada already eliminated their one-cent coins. Printing a paper $1 bill (costing 3.2 cents) is also cheaper than producing a penny. The half-cent coin was discontinued by Congress in 185. Proponents of eliminating the coin cite cost savings, speedier checkouts at cash registers, and the fact that a number of countries have already eliminated their one-cent coins. Canada for instance stopped minting penny in 2012.
The legality of Trump's order remains uncertain. The U.S. Constitution designates authority over coinage to Congress. However, Laurence H. Tribe, a constitutional law professor emeritus at Harvard University, argues that U.S. code gives the Treasury Secretary the authority to mint and issue coins "in amounts the secretary decides are necessary to meet the needs of the United States". Tribe argues that if Treasury Secretary Scott Bessent decides the amount necessary for the penny is zero, he's within his legal rights. It has been suggested by an analyst from Wall Street that the penny may soon be phased out, adding that this cessation is likely to withstand judicial scrutiny. Eliminating the penny would not be a unique measure as the US retired other denominations in the past. The move could prompt retailers to pay banks more for coinage and introduce legal risks for merchants and banks potentially leading Congress to respond
The US Mint reported losses on penny production for nearly two decades. In 2024 fiscal year the Mint lost $85.3 million on nearly 3.2 billion pennies it produced. The cost to produce each penny was nearly $0.037up from $0.031 the previous year. This "negative seigniorage" where production costs exceed the coin's face value has fueled the debate over the penny's continued use. Advocates for eliminating the penny cite cost savings speedier checkouts at cash registers and the fact that several countries such as Canada already eliminated their one-cent coins. Printing a paper $1 bill (costing 3.2 cents) is also cheaper than producing a penny. The half-cent coin was discontinued by Congress in 185. Proponents of eliminating the coin cite cost savings, speedier checkouts at cash registers, and the fact that a number of countries have already eliminated their one-cent coins. Canada for instance stopped minting penny in 2012.
The legality of Trump's order remains uncertain. The U.S. Constitution designates authority over coinage to Congress. However, Laurence H. Tribe, a constitutional law professor emeritus at Harvard University, argues that U.S. code gives the Treasury Secretary the authority to mint and issue coins "in amounts the secretary decides are necessary to meet the needs of the United States". Tribe argues that if Treasury Secretary Scott Bessent decides the amount necessary for the penny is zero, he's within his legal rights. It has been suggested by an analyst from Wall Street that the penny may soon be phased out, adding that this cessation is likely to withstand judicial scrutiny. Eliminating the penny would not be a unique measure as the US retired other denominations in the past. The move could prompt retailers to pay banks more for coinage and introduce legal risks for merchants and banks potentially leading Congress to respond
