US Mint to Cease Penny Production: A Costly Legacy Comes to an End

Washington, D.C. — The United States Mint has announced plans to halt production of the penny, marking a significant shift in the nation’s currency system. This decision comes in light of rising production costs and a growing consensus that the coin’s utility has diminished over the years.

A Costly Endeavor

A Treasury Department official confirmed that the last order of penny blanks has been placed, signaling the imminent end of the coin’s production when these supplies run out. The official, who requested anonymity, stated that the move is expected to save the government approximately $56 million annually due to dramatically increasing material costs, which surged by more than 20% in 2024. President Donald Trump, who announced the cease in production, emphasized the financial inefficiency associated with the penny. In a post on his Truth Social account in February, he stated, “For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!” His directive to the Secretary of the Treasury to stop producing the 1-cent coin was motivated by efforts to cut unnecessary expenses.

Historical Context

The penny has a long history, being one of the first coins minted after the establishment of the U.S. Mint in 1792. Currently, there are approximately 114 billion pennies in circulation, worth about $1.14 billion. However, the U.S. Treasury has indicated that these coins are significantly underused, especially in modern cash transactions.

Advocates for abolishing the penny cite its high production cost—estimated at nearly 4 cents per penny—as a primary reason for its discontinuation. Opponents, however, argue that the penny serves important functions, such as being a staple for small charity donations and maintaining pricing integrity, since it is the only coin that addresses transactions under 5 cents.

Legislative Landscape

Although Trump’s directive can curtail penny production, Congress holds the ultimate power to legislate this decision into permanence. In recent months, bipartisan efforts have emerged aimed at eliminating the penny. Among the proposed legislation are two bills introduced this year: the "Make Sense Not Cents Act," led by Senators Mike Lee (R-Utah) and Jeff Merkley (D-Ore.), and the "Common Cents Act," initiated by Representatives Lisa McClain (R-Mich.) and Robert Garcia (D-Calif.) alongside Senators Cynthia Lummis (R-Wyo.) and Kirsten Gillibrand (D-N.Y.).

Dr. Jay Zagorsky, a professor at Boston University, voiced support for the cessation of penny production but cautioned that Congress should implement legislation requiring prices to be rounded. This method could potentially decrease the reliance on nickels, which are even more expensive to produce at nearly 14 cents each.

The Next Steps

Mark Weller, the executive director of the Americans for Common Cents, acknowledged the inevitable shift toward halting the penny’s production, while urging the Treasury to seek more affordable production methods for nickels to manage their anticipated demand effectively.

As the U.S. moves forward in reconsidering its currency, the potential end of the penny invites discussions on the future of cash transactions and the practicality of maintaining coins in an increasingly cashless society. With both public opinion and legislative action evolving, the fate of the penny seems to be sealed, reflecting a broader trend in modern finance that prioritizes efficiency over tradition.

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