Trump tells US Treasury to stop minting pennies to save money

If you thought issuing more notes and coins could help a nation’s economy, think again. American President Donald Trump said Sunday he had told the US Treasury to stop producing penny* coins, presenting it as an effort to cut down on government spending.

“For far too long the United States has minted pennies which literally cost us more than two cents. This is so wasteful!” Trump wrote on his Truth Social platform.

“I have instructed my Secretary of the US Treasury to stop producing new pennies. Let’s rip the waste out of our great nation’s budget, even if it’s a penny at a time,” he added.

The new Department of Government Efficiency (DOGE) – a cost-cutting initiative led by billionaire Elon Musk that has been created to slash federal spending – highlighted the cost of producing pennies in a post on X in January.

Debates about the production cost of pennies are not new in the United States, with several bills having been introduced in Congress* that have failed to pass.

Trump’s order would likely require politicians’ approval but Treasury Secretary Scott Bessent may be able to simply stop minting new pennies, Northeastern University economics professor Robert Triest wrote in January.

Prices would likely be rounded to the nearest five cents if pennies were removed, Professor Triest said.

Canada announced in 2012 it was eliminating pennies from its own coinage system, citing a production cost of 1.6 cents each and its falling purchasing power because of inflation*.

Trump has made cutting the federal budget a prominent part of his new administration, with Musk’s DOGE team handed the job of investigating government spending.

However, the legality of some of the administration’s efforts – including slashing the US Agency for International Development’s headcount – has been challenged in court by Democrats* and labour unions.

SPEND A PENNY TO MAKE A PENNY?
Dropping a coin from the minting roster is not nearly as radical as it sounds.

Did you know that Australia had its own version of the US penny in one and two cent coins? Grandparents may still have a few hidden about the place as keepsakes, but these two coins were phased out last century for exactly the same reason Trump wants to stop producing the US penny today. It started costing more to make the coins than what their monetary value could buy.

In other words, instead of adding to the Australian economy, one and two cent pieces became a cost.

CENTS IN CIRCULATION
The Royal Australian Mint introduced one and two cent coins with decimalisation* on February 14, 1966.

The reverse side of the one cent coin had an impression of a feather-tailed glider and the two cent coin an impression of a frilled-neck lizard.

On 21 August 1990, the Royal Australian Mint announced that these two coins would no longer be included in national currency production. Thirty-five years before President Trump’s call to drop the US penny, Australia pulled two of its own coins because they were losing value due to inflation and there was a high cost in mining the metals.

At the time, the Mint released a statement that said one and two cent coins “would continue to be accepted as legal tender”, which meant people could still use the coins to buy goods.

It also meant banks and other financial institutions in Australia had to accept the coins if customers wanted to deposit them. Many Australians did have a lot of these coins to deposit, because they had been throwing one and two coins into loose change jars at home, rather than carrying the weighty but near worthless coins around.

These two coins were taken out of circulation at the beginning of February 1992.

DID YOU KNOW?
Australia has blazed a few trails in currency minting and printing over its relatively short federated history.

Revolutionary banknote technology was developed right here in Australia by the Reserve Bank and the Commonwealth Scientific and Industrial Research Organisation (CSIRO).

In a world first innovation, Australia issued the first ever polymer* $10 banknote in January 1988 to commemorate Australia’s bicentenary.

The technology was a game-changer: Australia’s polymer banknotes are far more secure against counterfeiting* than paper notes, as well as more durable, cleaner, more hygienic and recyclable into a range of plastic products after their busy, well-travelled life as legal tender has ended.

Australia’s “plastic money” technology has since been adopted by countries including New Zealand, the UK, Papua New Guinea, Vietnam, Brazil, Romania and Costa Rica – but not yet in the USA, which continues to use paper money, with its distinctive (if potentially confusing) uniform design.

Australia also once had $1 and $2 notes – and they were axed years before the one and two cent coins.

The $1 note stopped being issued following the introduction of a $1 coin on May 14, 1984. Four years later on June 20, 1988, the $2 banknote stopped being issued with the introduction of the small but mighty $2 coin.

Back when they were a drag on the hip pocket, comparatively heavy one and two cent coins had a nickname: coppers, although they were actually an alloy* of copper and zinc.

POLL

GLOSSARY

• penny: one cent coin and the lowest denomination in US currency
• Congress: the legislative branch of the federal government of the United States, which means it makes the country’s laws
• inflation: an increase in the level of prices of the goods and services that households buy
• Democrats: the other major political party in the US, who lost the US election to what is now Trump’s Republican administration
• decimalisation: process of changing a system, number, currency to the decimal system
• polymer: large molecules made of small, repeating molecular building blocks called monomers (see the image of Professor Solomon – he is seated behind a polymer model)
• counterfeiting: illegal activity of making fakes copies copies of things such as banknotes and passports
• alloy: substance formed by combining two or more metals

EXTRA READING

$1 and $2 notes worth big money

Why banana prices may go troppo

Real life Bluey dollarbucks for sale

QUICK QUIZ

1. What does the US penny currently cost to produce?
2. What does DOGE stand for?
3. Headed by tech billionaire Elon Musk, what was the DOGE been established to do?
4. What was the Australian version of the American penny?
5. Which two organisations were involved in inventing the polymer banknote and what was the first denomination printed?

LISTEN TO THIS STORY

CLASSROOM ACTIVITIES
1. A new coin?
Imagine that the Prime Minister has decided to introduce a new 15 cent coin. Create a design for the new coin. (Remember that on one side, there has to be a portrait of King Charles.)

Time: allow at least 20 minutes to complete this activity
Curriculum Links: English, Visual Communication Design

2. Extension
What would be the benefits and disadvantages of getting rid of cash altogether? Write as many of both as you can think of. You could use your research skills to help give you some ideas.

Time: allow at least 45 minutes to complete this activity
Curriculum Links: English, Critical and Creative Thinking

VCOP ACTIVITY
Conjunctions
Conjunctions are important in connecting ideas in a text and improving its flow. They help to join sentences, clauses or phrases to create a coherent and meaningful text.

Coordinating conjunctions are used to connect equal ideas or phrases – for example: and, but, or, so, yet, nor.

Subordinating conjunctions are connecting words or phrases that join a subordinating clause to the main idea. They provide additional information about the main idea – for example: because, although, while, when, if, since, until.

• Complete at least two activities from the choices below:
  Read the news article carefully and highlight all the conjunctions used in the text.
• Write down the conjunctions you found and the words or phrases they connect.
• Identify the type of conjunction used (coordinating conjunctions or subordinating conjunctions).
• Explain the role of conjunctions in connecting ideas and improving the flow of a text.
• Write a short paragraph about something you found interesting in the article. Challenge yourself to re-use three conjunctions from the text. Can you up-level them to a higher level conjunction? Does it make the sentence better or harder to read? (Sometimes the basic conjunction is the best choice.)