President Donald Trump has directed the U.S. Treasury Department to cease minting new pennies, citing the rising cost of producing the one-cent coin.
“For far too long, the United States has been minting pennies that cost more than two cents to produce. This is a massive waste!” Trump stated in a Truth Social post on Sunday night. “I have instructed my Secretary of the Treasury to stop producing new pennies.”
This decision is the latest in a series of rapid policy changes introduced by the new administration through executive orders and proclamations, covering a range of topics from immigration to government efficiency.
The Cost of a Penny
The financial burden of penny production has long been debated. The U.S. Mint reported a loss of $85.3 million in the 2024 fiscal year from producing nearly 3.2 billion pennies, with each coin costing approximately 3.7 cents—an increase from 3.1 cents the previous year. Similarly, the nickel remains unprofitable, costing nearly 14 cents per coin to manufacture.
While Trump did not campaign on the issue, the so-called Department of Government Efficiency, led by Elon Musk, recently raised concerns about the penny’s cost. The discussion gained traction after Musk’s post on X last month highlighting the inefficiency of continuing production.
Can Trump Unilaterally Eliminate the Penny?
It remains unclear whether the president has the authority to eliminate the penny without congressional approval. Currency specifications, including the size and metal composition of coins, are determined by Congress.
However, some experts believe there may be legal flexibility. Robert K. Triest, an economics professor at Northeastern University, noted, “The process of discontinuing the penny in the U.S. is somewhat ambiguous. While it would likely require an act of Congress, the Secretary of the Treasury might have the authority to simply halt production.”
Congress has considered various proposals to eliminate the penny over the years, ranging from temporarily suspending production to rounding transactions to the nearest five cents. Advocates argue that eliminating the coin could reduce costs, streamline cash transactions, and align the U.S. with other nations, such as Canada, which discontinued its penny in 2012.
Historical Context and the Bigger Picture
If the penny were discontinued, it would not be the first time the U.S. eliminated a low-value coin. The half-cent coin was removed from circulation in 1857.
Trump’s administration has placed significant emphasis on cost-cutting measures, with Musk spearheading efforts to reduce federal expenditures by up to $2 trillion. The initiative has targeted entire agencies and large portions of the federal workforce in pursuit of these savings.
“Let’s cut waste from our great nation’s budget, even if it’s just a penny at a time,” Trump declared in his post.
The announcement came as the president was departing New Orleans after attending the first half of the Super Bowl.