The penny, once a staple of American currency, has now become a symbol of inefficiency. It costs the US Treasury more than three cents to produce each one, leading to millions of dollars in losses each year. Despite the clear financial burden, the penny persists, mostly ending up lost or unused. As cash usage declines and inflation makes the coin nearly worthless, its purpose has become questionable, yet the penny remains in circulation.
Corporate interests, particularly from Artazn—the company responsible for supplying the zinc used in pennies—play a large role in keeping the penny alive. Artazn has lobbied hard to protect its interests, promoting the narrative that eliminating the penny would harm low-income consumers and charities reliant on coin drives. But these arguments don’t hold much weight today. Cash usage has been steadily declining, and many charities now rely on more modern methods of fundraising, such as rounding up credit card payments.
Canada’s successful decision to stop minting its one-cent coin in 2013 offers a compelling blueprint for the US. Canadian consumers have adjusted to the rounding system with little issue, and studies suggest that rounding prices to the nearest nickel in the US wouldn’t significantly impact consumers. The argument that eliminating the penny would result in unfair price hikes is largely unfounded. In fact, the costs associated with maintaining penny production far outweigh any potential consumer benefit.
What keeps the penny in circulation, despite years of discussion about its removal, seems to be simple inertia. The US Mint continues to produce them, and Congress hasn’t felt the urgency to stop. But interestingly, there’s one person who can single-handedly end the penny’s production: the Treasury Secretary. According to an obscure law, the Treasury Secretary can decide not to order unnecessary coins, a move that could finally put an end to the costly penny once and for all.
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