Despite President Obama’s opinion that the Lincoln cent has far
outlived its usefulness, U.S. Mint officials say the bureau will
continue to produce cents as long as the Federal Reserve orders them.
“The penny represents about 60 percent of our circulating coin
production,” Tom Jurkowsky, director of the U.S. Mint’s Office of
Public Affairs, said Feb. 25. “Our customer, the Federal Reserve,
requests the penny, and we meet those requests. We’ve been able to
achieve our cost savings on production of the penny — in fact, all our
coins — because of some management efficiencies we’ve undertaken such
as going to two shift operations and a continuing commitment to
It currently costs the U.S. Mint 2 cents to produce and distribute
Of 9,336,230,000 coins struck in circulation quality during
calendar year 2012, 6,015,200,000, or 64.4 percent, were Lincoln
cents. The Denver Mint struck 2,883,200,000 cents in 2012 and the
Philadelphia Mint, 3,132,000,000 1-cent coins.
The cent has come under sharp criticism for years for being
archaic, but moreso beginning in 2006 when the cost of production and
distribution of each coin into circulation exceeded its face value for
the first time.
Some critics argue that the time has come for Congress to take
decisive action and legislate the Lincoln cent into obsolescence.
Media attention was focused on the cent after Obama was quoted in
comments posted online Feb. 14 that the cent is a “good metaphor” for
some of the government’s financial problems and an example of
Using Google’s video chat service to channel former President
Franklin D. Roosevelt’s classic radio “fireside chats” of the 1930s,
President Obama fielded questions from the public on topics ranging
from his views about eliminating the cent, to gun control and climate change.
The event was President Obama’s second such video chat with the
American public since first becoming president in 2008.
The first video chat occurred in 2012, following that year’s State
of the Union address.
President Obama was asked during the Feb. 14 video chat why cents
are still being produced when the consensus among economists is that
the denomination is inefficient.
“The penny is an example of something that I need legislation
for,” the president said Feb. 14. “Frankly, given all the big issues
that we have to deal with day in and day out, a lot of times, it just
doesn’t, we’re not able to get it.”
Coin World contacted the White House public affairs staff
several times for comment concerning whether President Obama’s Feb. 14
remarks could be construed as a policy statement. White House
officials did not respond with official comments.
In 2001, the cost to produce and distribute each copper-plated
zinc cent totaled 0.080 cent. The cost has fluctuated in the years
since, according to the annual Mint director’s report for each year.
Cent study on metals
In 2010, Congress passed the Coin Modernization, Oversight, and
Continuity Act of 2010, Public Law 111-302, authorizing the U.S. Mint
to conduct ongoing research and development into alternate coinage
metals for all circulating coin denominations, not just the cent and
copper-nickel 5-cent coin, both of which cost roughly double their
face value to produce and distribute.
The act also mandates that the Mint submit biennial reports to
Congress on its findings from that ongoing research and development.
The Mint filed its first biennial report on Dec. 13, 2012.
Although the Mint did not make specific recommendations for
composition substitutes based on its research findings, it identified
a front-runner alternative for the cent — copper-plated steel.
The composition alternative, however, offers no cost savings over
the current copper-plated zinc composition, according to the research
and development findings submitted to Congress by the Mint.
Acting U.S. Mint Director Richard A. Peterson has previously
stated to Coin World that it is highly unlikely that the
combined production and distribution costs for the cent will ever fall
below its face value. ■