{"id":38753,"date":"2025-02-13T13:45:00","date_gmt":"2025-02-13T13:45:00","guid":{"rendered":"https:\/\/www.lifeandnews.com\/articles\/?p=38753"},"modified":"2025-02-13T20:43:02","modified_gmt":"2025-02-13T20:43:02","slug":"can-the-president-really-kill-off-the-penny-and-should-he","status":"publish","type":"post","link":"https:\/\/www.lifeandnews.com\/articles\/can-the-president-really-kill-off-the-penny-and-should-he\/","title":{"rendered":"Can the president really kill off the penny \u2013 and should he?"},"content":{"rendered":"\n

Jay L. Zagorsky<\/a>, Boston University<\/a><\/em><\/p>\n\n\n\n

In the middle of Super Bowl LIX, President Donald Trump posted on social media that he was getting rid of the penny<\/a>. Since the lowly penny in 2024 cost about 3.7 cents to make<\/a> \u2013 meaning the government loses money on every coin \u2013 the announcement might seem practical at first glance. But does the president have the power to kill off the penny?<\/p>\n\n\n\n

I\u2019m a business school<\/a> professor<\/a> and a longtime advocate for physical money who has written op-eds supporting the penny in The Wall Street Journal<\/a> and CNN<\/a>. My forthcoming book, \u201cThe Power of Cash<\/a>,\u201d explores the many advantages of using old-fashioned currency. Yet inflation has slashed the value of the penny by a third in just the past decade, and even I now admit that its time is up.<\/p>\n\n\n\n

But eliminating the penny via a social media post isn\u2019t just legally dubious. It could cause more problems than it solves.<\/p>\n\n\n\n

The penny problem<\/h2>\n\n\n\n

Critics see the penny as a shining example of government waste<\/a>. Last year, the U.S. Mint lost US$85 million<\/a> making pennies, according to the bureau\u2019s annual report. It also lost about $18 million minting nickels. Now, to be clear, just because the mint didn\u2019t make money on pennies or nickels doesn\u2019t mean it\u2019s losing money overall. In 2024, the mint earned a profit of about $100 million<\/a> making the country\u2019s pocket change. Still, $85 million is no small sum.<\/p>\n\n\n\n

Meanwhile, public opinion on the penny is split. Some surveys show support for it<\/a>, but it has plenty of opponents<\/a>. Many of my students cite carrying around \u201cnuisance coins\u201d like the penny as a reason for switching away from using cash.<\/p>\n\n\n\n

The good news, for those who dislike the penny, is that the coin is disappearing on its own. The U.S. Mint has made about 5 billion pennies annually throughout the 2020s \u2014 down from about 11 billion each year in the 1990s. So far in 2025, it has only made about a quarter of a million<\/a> pennies.<\/p>\n\n\n\n

But is it legal?<\/h2>\n\n\n\n

Setting aside people\u2019s feelings toward the penny, the problem with the president\u2019s order, I think, is that only Congress can change the type of coins the mint produces.<\/p>\n\n\n\n

To be fair, some defenders of the president\u2019s order<\/a> believe his actions are legal<\/a>. But the U.S. Constitution\u2019s Article 1, Section 8<\/a> \u2013 which gives Congress the power to do important things like levy taxes, pay debts and declare war \u2013 also authorizes Congress \u201cto coin money.\u201d<\/p>\n\n\n\n

Now the phrase \u201cto coin money\u201d is vague. To fix that, the United States\u2019 second Congress<\/a> passed the Coinage Act of 1792<\/a>, which was signed into law by President George Washington. The act, which lays out how the mint operates and what it produces, says it must produce \u201cCents \u2013 each to be of the value of the one hundredth part of a dollar, and to contain eleven penny-weights of copper.\u201d<\/p>\n\n\n\n

Congress can modify this act anytime it wants \u2013 and it has. The 1792 act also required the mint to produce \u201cHalf Cents \u2013 each to be of the value of half a cent.\u201d These coins were eliminated in 1857 by an act of Congress<\/a>. Similarly, before 1965, many U.S. coins were made out of silver. After a 1965 congressional amendment<\/a> to the act passed, they were made out of a cheaper composite.<\/p>\n\n\n\n

And lawmakers have tried several times to eliminate the penny. In 1989, for example, Arizona Rep. Jim Hayes proposed the Price Rounding Act<\/a>, which called for cash purchases to be rounded to the nearest nickel. It didn\u2019t pass. More recently, in 2017, Republican Senator John McCain introduced the COINS act<\/a>, which would have eliminated the minting of pennies. The bill also proposed switching the paper one-dollar bill to a metal coin. It, too, didn\u2019t pass.<\/p>\n\n\n\n

What happens if pennies go?<\/h2>\n\n\n\n

Since Congress has failed to eliminate the penny in the past, Trump is trying to do so via a direct order to the Treasury secretary. However, many of Trump\u2019s actions are being challenged in court<\/a>. For the sake of argument, let\u2019s assume no one challenges the order to kill off production of the penny.<\/p>\n\n\n\n

A big problem remains. Even if the U.S. stopped making pennies, they\u2019d remain legal tender and people would still need them as change. In simple terms, the supply would change, but not the demand.<\/p>\n\n\n\n

Past efforts to phase out the penny have tried to deal with this problem by requiring rounding, but Trump\u2019s effort doesn\u2019t do this. I think it\u2019s entirely possible that people opposed to Trump would organize national \u201cDemand your penny in change\u201d days in an attempt to embarrass the president.<\/p>\n\n\n\n

The U.S. government loses less than $10 million a month minting pennies. In theory, Congress could pass legislation eliminating the penny and requiring rounding within a month or two. The cost to the government for doing things legally is low. If the penny has to go, let Congress do it the right way.<\/p>\n\n\n\n

Jay L. Zagorsky<\/a>, Associate Professor Questrom School of Business, Boston University<\/a><\/em><\/p>\n\n\n\n

This article is republished from The Conversation<\/a> under a Creative Commons license. Read the original article<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Jay L. Zagorsky, Boston University In the middle of Super Bowl LIX, President Donald Trump posted on social media that he was getting rid of the penny. Since the lowly penny in 2024 cost about 3.7 cents to make \u2013 meaning the government loses money on every coin \u2013 the announcement might seem practical at […]<\/p>\n","protected":false},"author":56,"featured_media":38754,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[5,46,295,25,296,27,4],"tags":[2633,6865,2826,479,224,885,891,886,860,8099,16042,16041,6291,1797,16043,1856,9645],"_links":{"self":[{"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/posts\/38753"}],"collection":[{"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/users\/56"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/comments?post=38753"}],"version-history":[{"count":1,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/posts\/38753\/revisions"}],"predecessor-version":[{"id":38755,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/posts\/38753\/revisions\/38755"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/media\/38754"}],"wp:attachment":[{"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/media?parent=38753"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/categories?post=38753"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lifeandnews.com\/articles\/wp-json\/wp\/v2\/tags?post=38753"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}