The U.S. penny, costing over 3 cents to produce, has become a financial burden, prompting a debate on its future. While retailers and businesses urge Americans to use coins, experts suggest the impact of its elimination would be minimal.
A bowl overflowing with quarters, nickels, dimes, and pennies sits in Tigard, Oregon, as a stark reminder of the coin conundrum facing the nation. Retailers, laundromats, and other businesses that rely on physical currency are urging Americans to dig deep into their wallets and homes for spare change, hoping to reignite the flow of coins back into circulation.
A coalition of trade associations representing diverse industries, including banks, retail outlets, truck stops, and grocery stores, is appealing to the Treasury Department for additional support in encouraging the public to embrace coins once again.The humble penny, costing over 3 cents to produce, has become a financial burden for US taxpayers. In Fiscal Year 2023, the production of pennies resulted in a staggering loss of $179 million, with the Mint churning out over 4.5 billion pennies, representing a hefty 40% of the total 11.4 billion coins minted for circulation. The rising costs of metals, particularly zinc, a key component of the penny, have driven up production expenses. A tight supply of zinc further exacerbated the issue, leading to a price surge in 2024.This persistent financial drain has ignited a national debate regarding the penny's continued existence in circulation. Experts estimate that there are approximately 240 billion pennies circulating in the United States, translating to roughly 724 pennies, or $7.24, per person. With the increasing prevalence of online shopping and credit card transactions, many argue that the impact of eliminating pennies would be minimal. One proposed solution involves rounding prices to the nearest nickel, potentially leading to adjustments like $9.99 becoming $9.95 or $10.06 rounding up to $10.10. While this could raise concerns about inflation, experts highlight that voters ultimately hold political leaders responsible for any perceived price increases. As the nation grapples with this economic dilemma, the future of the penny remains uncertain, leaving Americans to ponder its fate and the potential implications of its absence
PENNY COINS CIRCULATION INFLATION PRODUCTION COSTS
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