There has long been broad bipartisan agreement that the penny has outlived its usefulness. Yet multiple efforts by both Democrats and Republicans have died in committee, basically for lack of interest since the stakes are so low.
In February, President Donald Trump directed the U.S. Treasury to end the cycle of replacing coins that cost more than they are worth and disappear because no one wants them. Treasury will cease production once the existing supply of blank slugs is used up. The direct savings to the taxpayer will be miniscule, especially since demand for equally unprofitable nickels will increase. But the savings to the overall economy due to faster transaction procession and more efficient resource allocation are estimated at upwards of $1 billion per year, freeing up resources throughout the economy that will pay greater dividends.
The history of the ubiquitous coin harkens to the birth of the republic. In 1792, Congress passed the Coinage Act that established the U.S. Mint in Philadelphia. The mint’s first circulating coin was pure copper, larger than our current quarter and five times heavier than a modern penny. Officially called the “cent” or one cent piece (from Latin centum, “hundred”), the coin was popularly referred to as the penny, the common name for the ancient British coin used in the colonies. Penny derives from Old English “penig,” hence English pence and German pfennig, originally referring to any coin but eventually to one cent.
Rising materials costs led the mint to downsize the coin and alter its metal composition over time, including alloys of copper with nickel, zinc and tin. Today’s version is zinc coated with a thin layer of copper plating.
Early pennies bore representations of a stylized Lady Liberty, a flying eagle and an Indian head, as Americans reflexively opposed images of monarchs on their coinage. It was not until 1909 that the first president appeared: the profile of Abraham Lincoln engraved in honor of his 100th birthday, the same image that appears on modern pennies.