President Trump has ordered the Treasury secretary to stop producing new pennies, citing their high production costs and arguing that they “literally cost us more than 2 cents.” However, it is unclear whether he has the power to make this decision. The U.S. Mint’s annual report shows that it lost $85.3 million on the sale of over three billion pennies last year, with each penny making a loss of 2.69 cents.
Several countries have already eliminated their smallest-denomination coins in recent decades, including Canada and Australia, citing inflation and production costs as reasons. Experts argue that the move to eliminate pennies would save some money, but it could also lead to increased costs for other coins and potentially impose a one-cent sales tax on consumers.
The decision is likely due to sentimentality, with many people keeping pennies as mementos or hoarding them. However, the impact of eliminating pennies on the economy remains uncertain. As one expert notes, “People will put it in a paperweight or something; there’ll probably be some hoarding.” The issue highlights the complexities of making changes to currency and the need for careful consideration.
Source: https://www.nytimes.com/2025/02/09/us/politics/trump-stop-minting-pennies.html