WASHINGTON (AP) — President Donald Trump has announced that he has instructed the Treasury Department to cease the minting of new pennies, citing the increasing costs tied to the production of the one-cent coin. Trump remarked on his Truth Social account that producing pennies has become a burden, as their production costs exceed their face value. He stated, "For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!"
This directive represents a significant move from Trump’s new administration, which has been rapidly implementing changes through executive orders and proclamations on various issues, including immigration and gender diversity. Notably, Trump had not addressed the issue of the penny during his campaign, but recently, Elon Musk's Department of Government Efficiency had suggested the elimination of the penny due to its production costs in a post on X.
The U.S. Mint reported an $85.3 million loss in the 2024 fiscal year due to the production of nearly 3.2 billion pennies, with each penny costing approximately $0.037 to produce, an increase from $0.031 in the previous year. Additionally, the mint faces similar losses on nickel coins, with the production cost for each nickel rounding to nearly $0.14.
It remains uncertain whether Trump has the authority to unilaterally abolish the penny, as Congress sets the specifications for currency, including coin types and materials. However, Robert K. Triest, an economics professor at Northeastern University, indicated that the Secretary of the Treasury may have some latitude to halt minting new pennies without needing Congressional approval.
Legislative attempts to eliminate the penny have been made in Congress over the years, with various proposals aiming to suspend its production, remove it from circulation, or standardize pricing to the nearest five cents. Advocates for eliminating the penny argue it would lead to significant cost savings, faster checkout processes, and align the U.S. with other countries that have removed their one-cent coins from circulation, like Canada, which discontinued its penny in 2012.
This would not be the first occasion that the U.S. has eliminated a low-denomination coin, as the half-cent coin was officially discontinued by Congress in 1857. Trump's current administration is keenly focused on slashing costs across the federal budget, with Elon Musk leading initiatives aimed at identifying an ambitious $2 trillion in savings across various government sectors.
Trump concluded his announcement while leaving New Orleans after attending the first half of the Super Bowl, emphasizing that even minor reductions in spending contribute to the nation’s fiscal health. His post echoed a broader intention to "rip the waste out of our great nation's budget, even if it’s a penny at a time."
