Pennies are worth more dead than alive.
That’s been true for a long time. Constant inflation, even at the low levels of the pre-Biden era, steadily ate away at the value of the venerable 1-cent coin. The 95% copper cent of the 1970s became worth more than the face value after that decade’s high inflation, so in 1982, the Mint switched to pennies that were 97.5% zinc under a shiny copper coating. But the rising prices soon caught up to zinc, too. By 1989, Rep. Jim Kolbe of Arizona was among the first to propose doing away with the penny altogether, as the cost of metal looked to overtake the face value once again.
Thirty-six years later, the penny is even more overpriced, costing the Mint 3.69 cents to make each 1-cent piece. People have been talking about it for decades, but no serious effort has been made to finish off the coin, which has been the smallest circulating currency unit in America since the half-cent was eliminated in 1857. The only governmental response to the penny’s soaring intrinsic value was a 2006 Treasury regulation banning pennies from being melted or exported.
That may be about to change now that President Donald Trump has joined the anti-penny team.
“For far too long the United States has minted pennies which literally cost us more than 2 cents,” Trump wrote in a social media post earlier in February. “This is so wasteful! I have instructed my Secretary of the US Treasury to stop producing new pennies. Let’s rip the waste out of our great nations budget, even if it’s a penny at a time.”
It is legally doubtful that the penny can be made to disappear by executive order, but perhaps the president’s call to action will shake things loose in Congress after all these years. It would save the taxpayer money, and we would barely notice the change financially. How can we know this? Because Canada, Australia, New Zealand, and other countries did the same thing, and it had no effect on their economies. Prices get rounded to the nearest nickel, the government saves some money, and everyone moves on with their lives.
But if America does go down this road, Congress should really consider a more thorough revision of American currency for the first time since the 1960s. The nickel now costs 14 cents to make, a victim of the same forces that raised the penny’s cost (despite the name, the nickel is 75% copper). We should not abolish the 5-cent coin, but we should explore cheaper metals from which to make it. Dollar bills, too, bear a cost in that they wear out more quickly than coins. A dollar coin, though more expensive to make, is more cost-effective for the simple reason that metal is much more durable than paper.
A reassessment of the whole system is long overdue. Sixty years ago, in 1965, Congress took the silver out of dimes and quarters. Four years later, the Federal Reserve discontinued all bills over $100 — these large bills had not been printed in many years and were mainly used between banks even when they were circulated. They are all still legal tender today, just like any silver quarter or dime, but they are worth far more as collectors’ items and so are basically never seen in ordinary commerce.
A hundred-dollar bill was a serious amount of cash in 1969. According to the Bureau of Labor Statistics’s inflation figures, $100 in January 1969 has a value of $892.33 in January 2025. Yet our currency system has not kept up. To put it another way, the median family income in 1969 was $9,400 — an average week’s salary, even before taxes, would not add up to two crisp Benjamin Franklins. By 2023, the median household income was $80,610.
But the “big bills” aren’t any bigger.
All those countries that eliminated the penny are in the same boat as the United States when it comes to banknotes: None of their central banks issue anything larger than $100. The eurozone, which began issuing currency in 1999, started with €200 and €500 as the biggest bills but stopped printing new €500 bills in 2019 (€500 is currently worth about $525).
Why hasn’t our cash kept up with inflation? The easy answer is that America, like all of those other countries, is an increasingly cashless society. When you can pay with a card or even your phone, why carry cash, which can be lost, stolen, or destroyed? Electronic payments are secure and efficient.
The only ones left using cash, according to conventional wisdom, are criminals and tax cheats. The eurozone’s rationale for phasing out the €500 bill was essentially this — the European Central Bank chalked up the decision to “concerns that this banknote could facilitate illicit activities.”
Until the last few years, that was an argument a reasonable person could make. Cash under the mattress, like gold buried in the backyard, was the artifact of paranoia, not an ordinary life. The powers that be would never track, let alone obstruct, the transactions of ordinary citizens.
But then they did.
The COVID-19 pandemic saw governments use power against ordinary citizens in many new and unpleasant ways, including financial. The Trudeau government in Canada was among the worst offenders. In 2022, a “Freedom Convoy” of truckers and others converged on Ottawa to protest the draconian lockdown conditions and vaccine mandates that were still being levied against the Canadian people after the pandemic had largely subsided.
Canadian Prime Minister Justin Trudeau invoked “emergency powers” and used the force of government in unprecedented ways to punish these political opponents, including targeting their financial activity and that of anyone who raised money to support them.
“The way to get your account unfrozen is to stop being part of the blockade and occupation,” then-Canadian Finance Minister Chrystia Freeland told reporters. That is to say: If you want access to your own money, which you earned legally, you have to stop protesting the government. Suddenly, the convenience of electronic currency disappears, and all without anyone affected being convicted of a single crime. At the government’s say-so, thousands were effectively impoverished.
Americans might argue it can’t happen here, that our Bill of Rights protects us in ways other countries’ constitutions don’t. It would be harder for our government to do this, but it can no longer be seen as impossible. Consider the effort by credit card issuers in 2022 to flag gun store purchases with a new coding system. And they didn’t exactly hide what they were doing. In an NPR story that year, gun control advocates praised the move, which NPR characterized as “a Democrat-supported effort led by the socially progressive bank Amalgamated Bank.” The story goes on to note that several payment processors, including PayPal and Apple Pay, already did not allow the purchase of guns.
Would banks and the state work together to restrict Americans’ financial freedom in a backdoor around the Bill of Rights? When you consider how social media companies worked with the Biden administration to restrict what people could say online about the pandemic, these theories leave the realm of paranoia and become eminently plausible. Anything digital can be controlled, whether by the state, the businesses that operate it, or a combination of the two.
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And does restricting cash really cut down on financial crime? Dark web transactions are taking place in cryptocurrency, as they have for years now. Like the credit card companies’ attempts to make gun store purchases more difficult, these measures only encumber the law-abiding — the crooks are already working outside the system.
Congress could save America money by phasing out the penny and redesigning the nickel. It could also lock in Americans’ financial freedom by expanding the higher-denomination notes with new $200, $500, and even $1,000 bills. Americans face modern threats to their privacy and financial freedom. Only a modernized currency system for the 21st century can prevail against those threats.
Kyle Sammin is the managing editor of Broad + Liberty.
