This is the economic argument - even if the US penny didn't cost more than a penny to produce, the reality is there are no transactions that truly require less than 10 cents anymore - you can't walk into any store/business in the US and spend less than 10 cents as your total. Anything that individually costs less than 10 cents (like say a single nail, or a single slice of bread) can be easily bundled into a group for 10 cent increments.
We are just used to 2 decimal places for pricing, but at this time 1 decimal places is enough precision for differentiating prices on low cost goods. (Things that we measure by the weight or by the liquid volume for pricing can just be recalibrated to 0.10 increments).
The US should really discontinue the nickel and quarter as well, and have a dime (for now), half-dollar, dollar and five-dollar coins along with 10 and 50 bills which would be enough for almost all legal transactions before electronic transfer would kick in. And require taxes to be built into prices and fees to be in 0.10 increments so that all prices fall to 1 decimal places.
Paper money does have value though, especially for people and situations when having electronic transfer is impractical (locations outside of networks, small transactions, events and fundraisers, etc.) or for people who cannot afford traditional banking or electronic devices - still a thing.
