First issued in 1793, the U.S. cent (penny) coin disappeared as a relic of the past after 232 years, opening the era of “post pennies.”
Reuters reported on the same day that the last circulating one-cent coin production took place at a Philadelphia minting facility on the 12th, with U.S. President Donald Trump ordering a halt to the production of one-cent coins in February.
President Trump ordered the Secretary of the Treasury to stop new production of 1 cent coins, saying that the cost of making 1 cent coins is greater than the face value. The U.S. Treasury Department said the cost of producing 1 cent coins amounted to 1.69 cents per unit, and expected the cost savings from the suspension of production to reach $56 million per year.
One-cent coins will remain in legal currency after production is suspended. The U.S. Treasury Department estimates that about 300 billion are currently in circulation. However, production of collection coins is expected to be limited in the future.
After a period of time, a shortage of one-cent coins in the market will force businesses to take steps to raise or lower prices to match prices in units of five cents, the Treasury Department believes.
Some fast food restaurants, such as McDonald’s and Wendy’s, are preemptively introducing a method of raising or lowering the amount to the nearest five-cent unit if the change is not accurate when paying in cash, according to Business Insider. A McDonald’s official said, “This problem affects all retailers across the United States. We will continue to work together to obtain government guidelines.”
Dylan, a former senior director of government relations at the National Retail Federation (NRF), the largest U.S. retail industry organization, also urged clearer government guidelines, noting in a statement on the 29th that “without the government’s preemptive guidelines, retailers and cash-settlement companies could be exposed to legal risks even if necessary measures are taken in response to a nationwide penny shortage.”
In addition to the U.S., Reuters reported that there are many overseas cases of stopping the use of low-value coins for economic reasons. Canada, Australia, Ireland and New Zealand have stopped producing 1-cent coins due to cost cuts.
SAM KIM
US ASIA JOURNAL
