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Trump Moves to Halt New Penny Production Due to Rising Costs
In a recent announcement, President Trump revealed that he has instructed the Treasury Department to cease the minting of new pennies, citing the growing expenses associated with producing the one-cent coin.
In a post shared on his Truth Social platform, Trump expressed his concerns: “For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!” The new directive comes as part of a broader initiative by his administration to implement significant changes through executive orders covering various topics, from immigration and diversity to natural resource management.
Interestingly, the issue of the penny’s cost implications was not part of Trump’s campaign agenda. The discussion was sparked by Elon Musk’s newly formed Department of Government Efficiency, which highlighted the economic burden of producing pennies in a post on X.
Data from the U.S. Mint underscores the financial strain caused by the penny. In the fiscal year 2024, the mint reported a staggering loss of $85.3 million on the nearly 3.2 billion pennies made, with the production cost for each penny climbing to approximately $0.037, up from $0.031 in the previous year.
Moreover, the mint also experiences losses on nickels, as it costs nearly $0.14 to produce a $0.05 coin. This raises questions about the long-term viability of these lower denomination coins.
However, it remains uncertain if Trump possesses the authority to eliminate the penny unilaterally. The specifications for U.S. currency, including coin design, are typically established by Congress.
According to Robert K. Triest, an economics professor at Northeastern University, there may be some room for maneuver. He noted, “The process of discontinuing the penny in the U.S. is a little unclear. It would likely require an act of Congress, but the Secretary of the Treasury might be able to simply stop the minting of new pennies.”
Over the years, several congressional members have introduced legislation aimed at reducing the impact of the penny, with various proposals suggesting a suspension of its production, removal from circulation, or a requirement for prices to be rounded to the nearest five cents, as noted by the Congressional Research Service.
Advocates for eliminating the penny often cite potential cost savings, quicker checkout times, and the fact that other nations, like Canada, have already ceased minting their own one-cent coins since 2012.
This isn’t the first instance of the U.S. discontinuing a coin; the half-cent piece was eliminated by Congress in 1857. Trump’s administration is committed to cutting unnecessary expenditures. Musk, who is at the forefront of this initiative, is aiming for an ambitious $2 trillion savings goal, targeting various federal agencies and their operations.
Trump concluded his announcement with a decisive statement: “Let’s rip the waste out of our great nation’s budget, even if it’s a penny at a time.” This remark came as he was leaving New Orleans after attending the Super Bowl.
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