Bye, bye, pennies! Donald Trump wants to end with this coin in the United States. What will happen to those people who only use cash? As it happens with most of Trump’s decisions, this is a very ambitious plan that looks to modernize the monetary politics of the country and lower unnecessary costs.
At first you might think this move is not a big deal, but if you analyze this measure in depth there are some issues related to economy, society, and culture that have raised an intense debate in the whole country. So, let’s see what Trump is planning on doing this time in more detail.
The ‘’Common Cents Act’’
The House Financial Services Committee approved this bill, which means no more pennies. When did this happen? On July 23 of 2024, so not that long ago. And if you are wondering what the solution’s going to be: round all cash transactions to the nearest five pennies. To make it clear, if something costs $2.02, you will pay $2.00; but if the price is $2.03, you will pay $2.05.
Why get rid of pennies?
The main reason behind this idea coming from Trump is economic. According to data from the U.S. Department of the Treasury, manufacturing one penny costs around $3.69, just one!So, this is a negative thing for the country since for each penny the government loses money.
The representative Lisa McClain, one of the bill’s sponsors, explained that taxpayers shouldn’t keep funding a coin that generates loss. She said it’s time to modernize U.S. monetary politics.
Economic and employment impact
Don’t think Trump’s decision was well received by everybody. In Tennessee, where the only fabric producing planchets of pennies in the whole country, local authorities fear the loss of hundreds of jobs.
Greene County’s mayor, Kevin Morrison, warned about the negative impact this measure could have on the community, which mostly depends on the metallurgy industry related to the coin.
Even in Congress there were doubts in the beginning. The republican congressman of Tennessee, John Rose, expressed his concern about the effects of getting rid of pennies without a clear transition plan. However, after receiving guarantees, he ended up supporting the bill.
What will happen when paying in cash?
One of the most discussed points of this situation is the rounding of prices. It’s true that countries like Canada or New Zealand already use this system and works fine, but some fear in the U.S. could create confusion (mostly in elderly people or those who don’t use cards).
What’s more, companies will have to update their checkout systems which means an additional cost. However, those supporting the plan said the benefits in the long term will surpass these initial issues.
When will this happen?
We can’t tell you when this change will begin because there’s no exact date yet. However, what we do know is that the U.S. Department of the Treasury already did the last order of planchets in May 2024. It is expected to stop manufacturing until the beginning of 2026, when the current inventories run out. So, don’t worry because pennies won’t disappear tomorrow.
A historic change coming from Trump
Not only the possible end of pennies is an economic question, but also a cultural one. For more than 200 years, these small coins have been part of the everyday lives of American citizens, but now with Trump’s measure this will be history.
We will see if this measure will be known as controversial or as a needed step to make the U.S. economy more efficient. This will be a sad moment for nostalgic people, but do you think Trump’s decision is a positive move for the country or not?