Why does the US still make pennies?

Answer 1

The US continues to mint pennies (1-cent coins) for a number of reasons. Among others:

(1) Unlike many countries that levy sales taxes at the national level, the US has a crazy-quilt of state, regional, and local sales taxes that affect prices differently depending on where an item is purchased. While rounding up or down would probably even out in the long run, many people are concerned that rounding on individual purchases would cause some parties to benefit while others would be (pun intended) short-changed. As a result many people prefer to keep prices exact to the penny. Note though that with more and more payments being made electronically using coins for exact change is becoming less important. Also many stores that still deal with cash now have "penny trays" where people can add or take a couple of the coins if they wish while otherwise rounding their payment.

(2) Tradition. The cent was the first coin struck by the new country in 1793 and the denomination has been minted nearly every year since then. The obverse of the current 1-cent coin has been the same since 1909 and people view it as a symbol of both familiarity and stability.

(3) Resistance to change. Moreso than people in many other countries, Americans have tended to push back against anything that requires modifying long-standing habits even if those practices have become outdated. For example there has been significant resistance to adopting new, more-efficient light bulbs even though they'd save consumers huge amounts of money, and two attempts to switch from the old foot-pound-ounce measurement system to SI units have failed despite the facts that the US is the only non-metric country and conversion would save tens of billions of dollars every year.

(4) Lobbying by the zinc industry. The US Mint produces roughly 6 to 7 billion cents every year. Each coin contains 2.44 gm of zinc which means the Mint consumes about 16,000 tonnes of that metal annually, or about 5% of all zinc smelted in the US. While 5% may seem insignificant that still amounts to hundreds of millions of dollars so the industry is more than willing to lobby Congress to continue cent production. It's similar to the way the company that produces paper for $1 bills lobbies against using $1 coins in order to protect its interests.