Biden Orders Treasury to End Production of Pennies
President Joe Biden has directed Treasury Secretary Janet Yellen to cease production of one-cent coins, commonly known as pennies.
In a statement released on Monday, the White House cited the high cost of producing pennies as the rationale for the decision. "For too long, the United States has minted pennies that cost more than two cents to produce," the statement said. "This wasteful practice must end."
The production of pennies will be suspended indefinitely, effective immediately. The decision had been under consideration for several years, as the penny's value has steadily declined in recent decades. A 2016 study by the Congressional Budget Office found that the cost of producing a penny is 1.5 cents, while its actual value is only 0.8 cents.
The penny has been a part of American currency since 1793. However, its usefulness has been questioned due to its low value and the prevalence of cashless transactions. "Life would be simpler without this monetary detritus," said economist Henry Aaron in a 2013 commentary for the Brookings Institution.
The discontinuation of penny production will have a minimal impact on consumer prices. Businesses are expected to round prices to the nearest nickel or dime, as is common in many other countries. Charities that rely on penny donations may also be affected, but some experts believe that the penny's elimination could actually boost charitable giving by encouraging people to donate larger sums.