A penny saved is a penny … urned?
The possible impending death of the penny has piggy banks, give-a-penny-take-a-penny jars, and manufacturers of coin wrappers a bit nervous. In a move that would put the United States alongside Canada, Australia, and New Zealand, the big deal commonwealth countries, more or less, President Donald Trump said he no longer wants the U.S. to bother rolling out new pennies because the cost to the nation is too great.
Unlike paper currency, which more than pays for itself, pennies rely on metal, a more expensive and easily exhausted input to production than the linen and cotton that comprise the variety of paper bill denominations. Simply put, pennies cost more to produce than their face value, which makes their retirement in a sunny Florida beach coin jar a fairly straightforward move.
“According to the Mint’s annual report, a penny last year cost 3.69 cents to produce, up about 20% from 2023 due to the cost of materials, including zinc,” Reuters reported in February.
Let’s rewind to the infancy of the penny. The first penny, known as the Fugio cent, was minted at the dawn of the republic in 1787. Designed by Benjamin Franklin, it featured the words “Mind Your Business,” which, at the time, meant being mindful of one’s commercial activities, not staying out of someone’s personal affairs. The word “fugio” means to run away or flee. Coupled with the sundial depicted on this relic, the imagery suggested the popular term “time flies,” another saying that can be traced back to Franklin, a true fount of evergreen terminology.
Indeed, the inventor and statesman is considered the ultimate phrase coiner.
In 1857, the penny’s size was taken down a notch and changed to a copper-nickel alloy known as the Flying Eagle cent. This was quickly replaced by the well-known Indian Head cent — long a staple of any coin collector worth their salt — in 1859, which continued to use the copper-nickel composition through to the feet of the Civil War years. The resource constraints of that horrific conflict prompted the U.S. Mint to switch to bronze, which made the penny lighter and cheaper to produce. Think of it as austerity for the metal extraction business.
Yet more austerity came in another of America’s great wars. Pennies were briefly made of simple steel in 1943 to maintain a solid inventory of copper for the fight against Germany, Japan, Italy, and their proxies. By this point, the Abraham Lincoln penny, introduced in 1909, was as iconic a bit of loose change for Americans as it is today, 2 1/2 decades into the 21st century. (Well, a little less “loose” relative to 1940s retail prices.)
Now, pennies are nearly as archaic as marbles and 8-track players, though more ubiquitous. Cash is used in only about 15% of all purchases in the U.S. (black market activity not included). To say nothing of the penny, an extreme subset of cash, payments by cash represent the third most popular form of purchase after credit and debit cards.
Some Americans have voiced concern that a rise in prices would follow the termination of the penny. The feared scenario: Something that costs $1.98 will now cost $2.00 due to the necessity of rounding to the nearest nickel. But a moment’s reflection will show the folly of this thinking. As it stands, our currency could be even more granular. There could be, say, a half-penny coin or a quarter-penny coin and so on. But most of us don’t believe we’re being ripped off in a workaday manner in the current financial arrangement. And in any case, the above faulty logic works in the other direction as well: Something that would have been priced at $1.97 would now cost $1.95.
“Not many Canadians rue the loss of their penny [in 2013],” Robert Whaples, a Wake Forest University economist, told the Washington Examiner.
He went on to explain just what the president has the power to do and not do:
“The president has the leeway to make decisions about coins being minted, i.e., how many of each penny, nickel, or what have you. But he doesn’t have the power to say the penny can no longer be considered a valid form of money; that’s for the legislature.”
Whaples predicted that the discontinuation of the penny would indeed move forward, and while the next president could undo it, they likely wouldn’t. To imagine a populist revolt against the undoing of the Lincoln penny at this late date is as fanciful as the undoing of Lincoln himself.
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With an estimated 240 billion pennies in circulation, it’ll be a long, long time before we stop seeing them in the wild. Perhaps the only use case for the penny a decade from now will be as the ultimate rebuke to bad service — to register extreme disappointment with one’s waiter or valet. (Yes, receiving a penny is worse than receiving nothing at all.)
Dain Fitzgerald is a writer and “podtuber” in Diamond Springs, California, in the beautiful Gold Country of El Dorado County. His Substack is @mupetblast.