Elon Musk's DOGE takes on the US penny, highlights how it costs thrice its value to make

The US penny costs over three cents to make, despite it denominating only one cent, costing taxpayers over $179 million in 2023

Published on: Jan 23, 2025, 16:14:51 IST

By HT News Desk | Edited by Abhyjith K. Ashokan

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Elon Musk's Department of Government Efficiency (DOGE) created to cut down on government spending has highlighted that minting the US penny is costing taxpayers significantly.

There have been many attempts since the 1970s to phase out the penny after its cost of production had been recognised, but this has seen no results so far (Representational Image/Pixabay)

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“The penny costs over 3 cents to make and cost US taxpayers over $179 million in FY2023,” the department wrote in a post on X (Formerly Twitter).

For context, one penny denominates only one cent.

The post went on to say that the Mint produced “over 4.5 billion pennies in FY2023, around 40% of the 11.4 billion coins for circulation produced.”

However, there have been many attempts since the 1970s to phase out the penny after its cost of production had been recognised, but this has seen no results so far, according to a Business Insider report.

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A large portion of the cost comes down to the materials used. The coins were originally pure copper, but have been nearly 98% zinc since 1982 per JM Bullion. And zinc isn't as cheap as it once used to be.

As a result, the penny's minting cost increased by 12.9%, which is the most of any other coin, according to the report.

Another consideration is that fewer people are using cash every year for transactions in the US, according to the report which cited the Federal Reserve's 2024 report on consumer payments which revealed that only 16% of payments in 2023 was made in cash, while the figure used to be 18% a year before.

However, it is unclear if DOGE will actually take on the penny.

US President Donald Trump signed an Executive Order, making DOGE became an official US government agency right after he took office on Monday, January 20, 2025.

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However, its scope has so far, been limited to updating the federal government's IT systems. The post on the penny highlights the possibility that its function may get eventually extended past just IT.

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HT News Desk
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