President Donald Trump announced on Monday he has directed Treasury Secretary Scott Bessent to cease penny production, following recent criticism of the coin’s costly manufacturing process.
What Happened: “For far too long the United States has minted pennies which literally cost us more than 2 cents,” Trump posted on social media. “This is so wasteful! I have instructed my Secretary of the US Treasury to stop producing new pennies. Let’s rip the waste out of our great nations budget, even if it’s a penny at a time.”
The decision comes after Elon Musk‘s Department of Government Efficiency (DOGE) highlighted the economic inefficiency of penny production last month. According to DOGE, the U.S. Mint spent $179 million in taxpayer funds during the fiscal year 2023 to produce 4.5 billion pennies, with each coin costing 3.07 cents to manufacture – more than triple its face value.
Why It Matters: The penny’s composition of 97.5% zinc and 2.5% copper plating contributes to its high production costs, with parts and labor accounting for 88% of manufacturing expenses across four U.S. Mint facilities. The coin represents approximately 40% of total coin circulation in the United States.
The move aligns with actions taken by other nations, including Canada and the United Kingdom, which have already eliminated their lowest-denomination coins. If implemented, the nickel would become America’s lowest-value coin in circulation.
This latest development adds momentum to a long-running debate about the penny’s future. In 2013, the Brookings Institution advocated for discontinuing both penny and nickel production, suggesting broader reform of U.S. coinage.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
