Trump announces plan to stop making new pennies, citing production costs
Trump announces plan to stop making new pennies, citing production costs
Not gonna lie, I agree with this. Pennies are useless.
Thanks to Trump, America doesn't make any cents.
Slow clap...
The reason we continued to make the penny is to maintain zinc production, which is important for wartime manufacturing.
By ending penny production, it will save money, but may compromise our future ability to wage war.
If we want to have artificially-generated demand for zinc -- if we really need to ensure domestic production capacity -- there's no requirement for it to be the penny. I'm sure that we can find something else to make out of zinc.
The penny itself wasn't always zinc. I don't remember the changeover year.
checks WP
https://en.wikipedia.org/wiki/Penny_(United_States_coin)
The current copper-plated zinc cent issued since 1982 weighs 2.5 grams, while the previous 95% copper cent still found in circulation weighed 3.11 g (see further below).
https://en.wikipedia.org/wiki/Zinc
Zinc is most commonly used as an anti-corrosion agent,[123] and galvanization (coating of iron or steel) is the most familiar form. In 2009 in the United States, 55% or 893,000 tons of the zinc metal was used for galvanization.[122]
Zinc is more reactive than iron or steel and thus will attract almost all local oxidation until it completely corrodes away.
We can just subsidize zinc production, or purchase something that requires those anti-corrosion properties.
I also am not at all sure that this was in fact the rationale. I can't find a reference online to this being the rationale. I do see reference to zinc being useful because it's particularly inexpensive. And the numbers given on this article seem to support the idea that pennies don't really work out to generating a very substantial demand for zinc.
It's Not Big Zinc Behind The Campaign To Keep The Penny
To run through the numbers, a penny coin weighs 2.5 grammes. Let's call that all zinc (it's not, but close enough). There's 5 billion made a year, meaning that we've got 12,500,000,000 grammes, or divide by a million to get 12,500 tonnes. Now, if that were 12,500 tonnes of gold being made into coins every year, with global virgin production being around 3,000 tonnes, then sure, that would be a contract worth, umm, influencing the political process, to secure and keep running. The same would be true of many metals in fact. But it's just not true of the zinc industry. Using the USGS, the correct source for these sorts of numbers, we find that US production of zinc is around 250,000 tonnes a year, global production 13.5 million. Even if we assume (as we might, sounds like the sort of thing that might be true) that US coins must be made of US produced metal this is still a very marginal part of the total market.
Further, zinc runs about $2,200 a tonne at present, meaning that we're talking about maybe $25 million a year as the zinc cost of our pennies. And we're told who and how much is paid to keep lobbying for the penny:
But his written statement did not mention that Weller is actually a lobbyist and head of strategic communications for Dentons, a law firm representing the interests of zinc producer Jarden Zinc Products, a major provider of coin blanks that are made into currency.
...
Jarden Zinc Products spent $1.5 million from 2006 through the first quarter of 2014 lobbying on such things as “issues related to the one-cent coin” and represented by Weller when he worked at B&D Consulting and, more recently, Dentons.
No, the important point here is not the zinc industry, nor "Big Zinc". The important part is this "a major provider of coin blanks". If your business is making coin blanks then obviously you're very interested in the continued existence of coin demoninations that are made from coin blanks. That they're made from zinc is an irrelevance compared to that.
Believe me, you don't spend the best part of $200,000 a year in lobbying expenses in order to sell $25 million's worth of zinc. This metal is a commodity, you can sell that amount in one ten minute phone call to any London Metals Exchange ring member. Heck, give me a couple of days to get organised and I could sell it for you at the market price. I'd also charge rather less than $200,000 to do it.
EDIT: WP seems to also support the author's argument.
https://en.wikipedia.org/wiki/Jarden_Zinc_Products
The company has resisted past efforts to eliminate the penny in the United [1] through an astroturf lobby organization called Americans for Common Cents.
The company's largest source of revenue comes from the production of coin blanks, having produced over 300 billion blanks at their Tennessee facility.
So two wins
Do you have a source for this?
https://www.usmint.gov/learn/history/historic-coin-production
For the year 1943, pennies became zinc-coated steel because copper was essential to the war effort during World War II.
This is the closest I could find and I really doubt that this means much in the 21st century.
I mean for fucks sake we were using depleted uranium rounds during the Iraq War, not copper.
What about galvanized steel though? You know, like traffic signs, light posts, some cars, various construction materials etc? You could use zinc in so many ways. I expect those applications would also take a lot more zinc than the pennies ever could.
So as soon as the zinc lobbyist pay him, he'll back out.
What portion of our zinc production goes to manufacturing pennies?
someone tell him he's just copying canada now
Maybe he should think of joining Canada instead of trying to take us over.
Nothing wrong with taking a good idea and following it yourself.
But from the person who likes to think he’s always leading and not just a little bitch, anybody pointing it out probably gets ousted.
Pennies should go away, but this isn’t the way to do it. Canada’s process was well thought out with lots of guidance and direction.
This is dumb and will cause lots of confusion.
Yes instead of no longer making them, there is a better way
Should also drop nickels, quarters, and one dollar bills.
We'll have dimes (should be made larger), half dollar, and one dollar coins.
All prices can then be rounded to $0.1 instead of $0.01.
When we got rid of hay pennies (worth half a penny) in 1857, they were worth more than $0.15 is today.
Only reason I'd keep the dime around, is because we aren't quite ready to round prices to a whole dollar.
The quarter is the biggest problem with this plan. There's just too much stuff that runs on quarters and quarters themselves as a currency denomination have too much cultural staying power.
Unfortunately, there being a 25¢ coin rather than the more globally-common 0.20 piece means that it isn't practical to retire the nickel because it will still be possible to get non-multiples of 10¢.
$1 notes are important, not because of any reason in the US (dollar coins would work equally well in almost any application), but because the US dollar circulates widely in foreign countries that are suffering hyperinflation of their local currencies and have thus informally dollarised. There, US coinage is basically non-existent meaning the lowest denomination that can be transacted in USD cash is $1. See the situation in Zimbabwe where American banknotes circulate until they literally fall apart or the ink has all faded away off.
So the existence of a $1 note is paramount to keeping the economies of these countries going. It would be impossible to conduct business if the smallest denomination is $5 and your $4 an hour salary is paid in cash.
Remember, as unfortunate as it is, much of the US's monetary policy is driven by the fact that the US dollar isn't just America's currency. It's the entire world's currency.
Every pay phone in America cost a dime when I was little. Then, by the time I was old enough to need to carry around change for a pay phone, all of them only took quarters. Do you know how many millions of pay phones there used to be? They somehow found it cost-efficient to modify almost every single one of them in the entire country. After the Bell system was broken up.
There’s just too much stuff that runs on quarters [...] too much cultural staying power.
"Because that's the way it is" is never a good reason not to do something new.
It's always the case that things don't change. Until they suddenly and unexpectedly do. Then in hind sight it seems obvious they should have changed long earlier.
US dollar circulates widely in foreign countries [...] There, US coinage is basically non-existent
There's no real reason coins couldn't circulate in foreign markets. They don't because the value to weight ratio is worse for shipping. But if the coin value went up to a dollar, and the dollar note wasn't an option anymore, foreign markets would adapt just fine. Especially since the coins would circulate for decades longer.
Retire the penny, nickel, and dime, and only allow transactions in multiples of $0.25?
Holy fucking shit, a broken clock moment?
We Finns don't use the 1c or 2c denominations in euro coins. If you use cash, it gets rounded to the nearest 5c.
As in 10.02 becomes 10.00, 10.03 becomes 10.05.
If you pay with card, no rounding.
When buying gas when younger you'd always see that it's 2 cents or 7 cents the sum on the meter ends on.
I think like more someone in his government thought they need to do something people don't hate and the only reasonable thing Trump didn't have a tantrum about when it was brought up was the futility of the existence of pennies.
DOGE is shooting for optics, not actual savings. Cutting penny production is about $90M out of the $6.1T deficit. Which isn't as useful to the American people as the headline is for DOGE. Their goal is to get one of these headlines every month to make it look like they're doing something useful.
But 70% of our deficit is: Social Security, Medicare, Medicaid, Military, and Interest payments on debt.
And if they cut literally everything except for these, we'd still run over a $4T deficit. Meanwhile, the quality of life for Americans by cutting all that will get measurably worse.
So yeah, more likely is that they'll keep aiming for random little optics opportunities, while trying to find ways to funnel more of this money to Musk and his buddies via govt contracts.
Or assume they're only pretending to save money and it's all about crippling our government.....
Yes, that's exactly the point I made.
What part of the deficit is Social Security? It’s self-funded, no?
The boomer generation is getting old. There are more people drawing from SS than paying into it.
I've been throwing pennies away for years. Now I got to throw away nickels? Trump ruins another thing I liked.
I'll take your pennies!
Trump thinks pennies are useless because he wasn't allowed to use them in a strip club.
This will require rounding up to the nearest nickel... Which costs $0.14 to make 🙄
The penny, one of the first coins made by the U.S. Mint after its establishment in 1792, now costs more than two cents to produce, Trump said in a post on his Truth Social site shortly after departing the Super Bowl game in New Orleans.
“For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!” Trump wrote. “I have instructed my Secretary of the US Treasury to stop producing new pennies.”
While I think that it's probably something that we should have done a long time ago, I don't think that the major cost is actually the fact that the production cost is higher than the coin's face value, but from the cost of needing to handle and process pennies.
why does it take an executive order from someone like Donald Trump to do this? I could be wrong but I don't think there's any developed country that has a smaller denomination note. in my shithole country they simply round up to the nearest $1000
I disagree in the sense most transactions are digital now and pennies are worth a penny every time they are used. If there are indication folks are trying to recover the base value of pennies then it makes sense. It will have to be done eventually though and better trump be the president that killed lincolns coin.
Cool, I think this is a good idea.
Australia did this in the... 90s? I wanna say 90s. We had 1c and 2c coins, but they decided it was costing too much to produce them. So they phased them out gradually I think.
Idk if it'll save any money, costs pennies to manufacture
I bring forth, "the pee pee!"
A durable replacement for the penny...a Plastic Penny! "Pee, pee!" Get it?
You know what they say, “even a broken penny is right twice a dollar”
Or something like that