Elon Musk’s Department of Government Efficiency has set its sights on a new target to reduce costs: the US penny. According to the department, it costs more than 3 cents to produce a penny and the US government has spent over $179 million on them in the 2023 fiscal year. In fact, the US Mint produced over 4.5 billion pennies in 2023, which is around 40% of the 11.4 billion coins produced for circulation.
The rising cost of metals, including zinc and copper, is part of the reason it’s getting more expensive to make the coin. The US Mint reported that it costs around 3.7 cents to produce and distribute a penny in 2024, a 20% increase from the previous year.
This is not a new idea, however. For years, there have been advocates for eliminating the penny, as they are rarely used as change and more consumers are opting to shop online or avoid physical currency altogether. The idea has even been discussed in popular culture, such as in a 2001 episode of the TV show “The West Wing.”
Some experts suggest that abolishing the penny could have benefits, including saving store clerks and cashiers time. If frontline workers could save just 2 seconds per customer, that would add up to 1,203 days of productivity.
While this is not a new idea, Elon Musk’s involvement in the Department of Government Efficiency brings new attention to the issue. The department has been heavily involved in the new Trump administration, with President Donald Trump establishing it in an executive action. However, its co-runners, including Elon Musk and Vivek Ramaswamy, have faced changes in their roles, with Ramaswamy reportedly being pushed out of the department.