The US penny, which has been costing taxpayers more than its face value to produce, has become a target for cost-cutting under President Trump’s newly established Department of Government Efficiency (DOGE).
Headed by billionaire Elon Musk, DOGE aims to streamline government operations and reduce wasteful spending, with a specific focus on areas like the production of the penny.
According to a tweet from DOGE’s official X (formerly Twitter) account, the US spent over $179 million in fiscal year 2023 to produce more than 4.5 billion pennies. The tweet highlights that the cost of manufacturing each penny exceeds three cents, roughly three times its actual value. This marks the 19th consecutive year in which the penny has cost more to produce than its face value.
The high production cost is primarily due to rising material prices, particularly zinc, which now makes up the majority of the penny’s composition. While pennies were originally made of pure copper, since 1982 they have been composed of nearly 98% zinc, with only a copper coating to provide their distinct color. Zinc prices have doubled since 2016, further driving up production costs, which rose by 12.9% in 2023.
DOGE, which was officially created by an executive order on Trump’s first day in office, is tasked with identifying areas of inefficiency within the US government. In addition to questioning the cost of the penny, DOGE is also aiming to reduce government spending by up to $500 billion annually.
With cash transactions in decline, as noted in the Federal Reserve’s 2024 report, there is growing debate about whether maintaining the penny is still worthwhile. While DOGE has criticized the penny’s production costs, it remains unclear whether the department plans to actively push for its discontinuation. Any decision to remove the penny from circulation would require congressional approval.
As the debate around the penny continues, some X users have suggested that eliminating the coin could result in significant savings, with one user estimating that removing the penny could save $13.5 billion.
New York Post and Newsweek contributed to this report.
