Trump Ends Penny Production, Citing Wasteful Spending in U.S. Budget/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ President Donald Trump has ordered the U.S. Treasury to stop minting pennies, citing their rising production costs and calling the coin a waste of taxpayer money. The move aligns with Elon Musk’s Department of Government Efficiency (DOGE), which is leading a $2 trillion cost-cutting effort. However, Congress controls U.S. currency laws, raising questions about whether Trump has the authority to unilaterally eliminate the penny.
Trump Orders U.S. Treasury to Stop Minting Pennies – Quick Look
- Trump’s Executive Action: The president ordered the Treasury Department to halt new penny production, citing high costs.
- Rising Costs: Each penny now costs nearly 3.7 cents to make, resulting in $85.3 million in losses in 2024.
- Congressional Approval Needed? Currency laws fall under Congress, meaning Trump’s order could face legal challenges.
- Musk’s Influence: The move aligns with Elon Musk’s Department of Government Efficiency (DOGE), which has been targeting wasteful spending.
- Historical Precedent: The U.S. discontinued the half-cent coin in 1857, and Canada phased out its penny in 2012.
- Trump’s Comment: “Let’s rip the waste out of our great nation’s budget, even if it’s a penny at a time,” Trump wrote on Truth Social.
Trump Orders U.S. Treasury to Stop Minting Pennies – Deep Look
Trump Moves to End Penny Production, Citing Wasteful Spending
In his latest executive action, President Donald Trump announced that the U.S. will stop minting pennies, citing their rising production costs and calling the move a long-overdue budget fix.
“For far too long, the United States has minted pennies that literally cost more than 2 cents each. This is so wasteful!” Trump wrote on Truth Social.
“I have instructed my Secretary of the Treasury to stop producing new pennies.”
Why Is Trump Eliminating the Penny?
The U.S. Mint lost $85.3 million in 2024 producing 3.2 billion pennies, with each one costing nearly 3.7 cents to manufacture.
- The rising cost of raw materials (zinc and copper) has driven up production costs.
- The nickel also costs more to produce than its value—each 5-cent coin costs 14 cents to make.
- Several other countries, including Canada, have phased out their lowest-value coins due to similar cost concerns.
Does Trump Have the Power to Eliminate the Penny?
Under current U.S. law, Congress sets coin specifications, including size, weight, and metal composition.
However, some experts believe the Treasury Department could halt penny production without Congress.
“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,” said Robert K. Triest, an economics professor at Northeastern University.
Musk’s Role in Penny Elimination
Trump’s move follows a push from Elon Musk’s Department of Government Efficiency (DOGE), which highlighted the penny’s cost in a post on X last month.
Musk’s cost-cutting efforts have already targeted entire federal agencies, and his $2 trillion savings goal has put low-value government spending under scrutiny.
Abolishing the Penny: Arguments For & Against
Supporters Say:
- Eliminating pennies would save millions annually in production and distribution costs.
- Checkout transactions would be faster since pennies slow down cash payments.
- The U.S. has already eliminated lower-value coins, like the half-cent coin in 1857.
- Other nations, including Canada, Australia, and New Zealand, have already eliminated their pennies.
Critics Say:
- Trump may not have legal authority to halt penny production without Congress.
- Eliminating the penny could lead to “rounding inflation”, where retailers round up prices.
- Charities that rely on penny donations could see a decrease in funding.
- Cash-reliant communities might be disproportionately impacted, as many low-income households still use pennies in daily transactions.
Will the Nickel Be Next?
With the nickel also costing nearly three times its value to produce, some economists believe it could be next on Trump’s chopping block.
“If the penny is eliminated, the nickel’s future will come into question,” said a Congressional Research Service report.
What’s Next? Legal and Political Challenges Loom
While Trump has ordered the Treasury Department to halt penny production, the decision could face legal challenges.
- Congress may push back, arguing that currency laws cannot be changed by executive order.
- Retailers and consumer advocacy groups may challenge rounding laws, fearing unfair price hikes.
- Musk’s role in the decision could add controversy, as Democrats scrutinize his expanding influence in government.
For now, the penny’s fate hangs in the balance, with Trump’s decision sparking debate on government waste, economic policy, and executive power.
You must Register or Login to post a comment.