You’re staring at a copper-colored coin at the bottom of your cup holder. It’s sticky, a little tarnished, and honestly, you probably wouldn't even bend over to pick it up if it fell on the sidewalk. This leads to the big question everyone seems to be asking lately: did they stop making pennies? The short answer is no. Not yet, anyway.
But the long answer is way more interesting because it involves a massive government deficit, the skyrocketing price of zinc, and a bunch of lobbyists in Washington who really, really want that little coin to stay alive. If you feel like you're seeing fewer of them, you aren't crazy. It’s just that their role in our pockets is changing faster than the U.S. Mint can strike them.
The current state of the cent
Despite what you might have heard on a random TikTok or a suspicious Facebook post, the United States Mint is still pumping out pennies by the billions. In 2023 alone, the Mint produced over 4.5 billion one-cent coins. That is a staggering amount of metal for something that most people just toss into a jar and forget about.
So why the confusion?
Well, Canada killed their penny back in 2013. Australia and New Zealand did it way before that. When people see our neighbors to the north rounding their cash transactions to the nearest five cents, they naturally assume we’ve followed suit. We haven't. If you walk into a bank today and ask for a roll of pennies, they’ll give you one. It might be shiny, or it might be a crusty 1984 Lincoln, but it’s still legal tender and it’s still being manufactured in Philadelphia and Denver.
The "Penny Deficit" is real
Here is the kicker: it costs way more than a cent to make a cent. This isn't a small discrepancy either. According to the U.S. Mint’s 2023 Annual Report, the cost to produce and distribute a single penny has climbed to about 3.07 cents.
Think about that for a second.
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Every time a penny rolls off the press, the U.S. Treasury loses two cents. When you multiply that by billions of coins every year, you’re looking at a loss of nearly $100 million annually just to keep the penny in circulation. It’s a bizarre financial loop. We are literally spending millions of dollars to create something that has less purchasing power than almost any other object in the modern world.
The reason for this price hike is basically just the cost of raw materials. Pennies aren't actually copper. Since 1982, they’ve been made of 97.5% zinc with a thin copper plating. Zinc is expensive. Shipping heavy boxes of metal across the country is also expensive.
Why don't we just kill it?
If the penny is a "zombie coin" that eats tax dollars, why is it still here? It turns out that getting rid of a coin is a political nightmare.
First, there’s the "rounding tax" argument. Groups like Americans for Common Sense (which, despite the name, is actually a lobby funded largely by the zinc industry) argue that if we eliminate the penny, businesses will round prices up to the nearest nickel. They claim this hurts the poor. On the other side, economists like Robert Whaples have conducted studies suggesting that rounding actually balances out in the long run. Sometimes you round up; sometimes you round down.
Then there’s the nostalgia factor. People like Abraham Lincoln. He was the first historical figure to appear on a U.S. coin, starting in 1909 to mark his 100th birthday. Taking him off the lowest denomination feels, to some, like a slight against his legacy.
The Illinois Factor
Politics is local. Former President Barack Obama once famously said the penny is a metaphor for the difficulty of government reform. But since Lincoln is the pride of Illinois, many politicians from that state have historically fought to keep the coin alive. It’s a symbolic issue that carries a surprising amount of weight in the halls of Congress.
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What happens if they actually stop?
If the U.S. eventually decides to pull the plug, your life wouldn't change as much as you think. Digital transactions—which make up the vast majority of payments anyway—would stay exactly the same. Your $4.99 Netflix sub or your $12.52 Amazon order wouldn't change.
Rounding only applies to cash.
If your total at the grocery store is $10.02, you’d pay $10.00. If it’s $10.03, you’d pay $10.05. It’s a system that has worked flawlessly in Canada for over a decade. In fact, the Royal Canadian Mint reported that they saved millions of dollars almost immediately after the phase-out.
The hoarders and the "Wheat" hunters
There is a subset of people who are actually rooting for the penny to be discontinued. These are the coin roll hunters and investors.
Right now, it is actually illegal to melt down pennies for their metal content. The government knows that if people started melting 1940s copper pennies, the coins would vanish from circulation overnight because the copper in an old penny is worth more than one cent. If the penny is officially retired, those melting laws might eventually be lifted, or the numismatic (collector) value of "the last pennies ever made" could skyrocket.
If you have a jar of pennies at home, it’s worth checking for a few things:
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- 1943 Steel Pennies: These were made during WWII to save copper for the war effort. They look silver/grey.
- Wheat Pennies: These have two stalks of wheat on the back instead of the Lincoln Memorial or the Shield. They were made before 1959.
- Error Coins: Things like "Double Die" strikes where the lettering looks blurry or doubled.
Most pennies in your pocket are just zinc junk, but once they stop making them, even the junk becomes a "limited edition."
Is the nickel next?
Here’s a scary thought for the Mint: the penny isn’t the only loser. The nickel also costs more to make than it’s worth—roughly 11.5 cents to make a 5-cent piece. If we kill the penny, the nickel becomes the new "lowest" coin, and the pressure to eliminate that starts all over again.
We are moving toward a cashless society. It’s happening whether we like it or not. The penny is just the first casualty in a long war against physical currency.
Actionable steps for your spare change
Don't just let those pennies sit in a jar forever. If you’re wondering what to do with them while they’re still legal tender, here is the best way to handle it:
- Check for copper: If you have pennies from 1982 or earlier, they are 95% copper. These are worth about 2-3 cents in melt value. While you can't melt them now, they are a better "hold" than the modern zinc ones.
- Use a Coinstar (smartly): Don't pay the 11-12% fee. If you choose the "eGift Card" option, most Coinstar machines won't take a cut of your money. You get the full value for an Amazon or Starbucks card.
- Donate them: Charities often have "penny drives" because they know people are desperate to get rid of them. It’s an easy way to turn "trash" into a tax deduction or a good deed.
- Deposit them at the bank: Most banks will give you free paper coin wrappers. Spending an hour rolling coins with your kids is a weirdly satisfying way to "find" $20 you forgot you had.
The U.S. penny isn't dead yet, but it’s definitely on life support. The Mint will keep striking them until Congress gathers the political courage to say "enough." Until then, keep an eye on your change—you’re literally holding a government-subsidized piece of history that costs more to create than it can ever buy you.