Elon Musk's Department of Government Efficiency (DOGE) has identified the U.S. penny as a target for cost savings, highlighting its production cost exceeding its face value. While the penny's elimination has been debated for years, DOGE aims to make significant federal spending cuts, focusing on regulatory reform and agency restructuring.
Billionaire Elon Musk 's Department of Government Efficiency ( DOGE ) has a new target in its sights for trimming federal spending : the U.S. penny. In a Tuesday X post, Musk's DOGE wrote that the U.S. spends about 3 cents to mint each penny, which, of course, is only valued at 1 cent. 'The penny costs over 3 cents to make and cost U.S. taxpayers over $179 million in FY2023,' DOGE wrote. 'The Mint produced over 4.5 billion pennies in FY2023, around 40% of the 11.
4 billion coins for circulation produced.' In pointing out the penny's costliness, DOGE is taking aim at an issue that has sparked debate for years, although the price of manufacturing the cent has only grown over the past several years. In 2016, for instance, the U.S. was spending about 1.5 cents to mint each penny, or less than half of its current manufacturing cost. Still, the cent's $179 million in costs represents mere metaphorical pennies when it comes to DOGE's mandate to cut federal spending. President Donald Trump has said DOGE will provide recommendations to 'slash excess regulations, cut wasteful expenditures and restructure federal agencies.' Musk has said the group will aim to trim $500 billion in annual federal spending. DOGE co-leader Vivek Ramaswamy, recently announced he is leaving the organization, posting on social media on Jan. 20 that he will be stepping back from the effort to run for Ohio governor. On Monday, Mr. Trump signed an executive order officially creating DOGE, which will be housed within the executive branch and focus on upgrading the government's IT systems to 'maximize governmental efficiency and productivity.'The penny's rising cost During the past year, the penny's costs have only continued to rise, with the U.S. Mint's 2024 annual report finding that one cent now costs about 3.7 cents to manufacture and distribute.Pennies are mostly made of zinc, with a copper overlay to give them their distinctive color. While zinc's price fluctuates from year to year, its cost per metric ton is now double what it was in 2016, according to data from the Federal Reserve Bank of St. Louis. Federal officials have proposed suspending the penny in prior years, with former Treasury Secretary Jacob Lew pushing the idea in 2015. Some economists have also advocated for dropping the penny from circulation, but there could be a costly downside to ditching the cent, as transactions would be rounded to 5-cent intervals, the Federal Reserve Bank of Richmond said in a 2020 blog post. 'For a single item or small-value purchase, rounding up or down could represent a significant price change,' the post noted. Other nations have ditched their equivalent of the penny, including Canada, which stopped minting its one-cent coin in 2012. One 2018 economic analysis found that Canadian consumers paid about $3.27 million in additional Canadian dollars at grocery stores each year due to prices being rounded higher after the change.On the other hand, there may be additional, hard-to-quantify costs to using pennies that would argue in favor of elimination. Counting pennies to make change takes time, and as the old business adage goes, time is money,' the Richmond Fed noted. DOGE might want to set its sights beyond the lowly penny, as it's not the only coin that costs more to mint than it's worth. The U.S. Mint's 2024 annual report noted that it spends about 14 cents to make and distribute each nickel
Department Of Government Efficiency DOGE Elon Musk Penny Federal Spending Cost Savings US Mint Government Efficiency Regulation
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
DOGE or no DOGE, it’s time for Congress to fix Social SecurityRejecting policies that make the problem harder to solve is a good place to start.
Read more »
Doge Meme Appears in US Senate: 'Doge Inevitable'; Dogecoin Founder ReactsDogecoin founder has highlighted recent speech by Senator Joni Ernst with canvas of DOGE meme
Read more »
Musk Backtracks on DOGE Spending Cuts, Targets Remain UnclearElon Musk's ambitious plans to cut $2 trillion from the federal budget and dismantle large parts of the bureaucracy through the newly formed Department of Government Efficiency (DOGE) are facing reality checks. Musk acknowledges the difficulty of achieving such drastic cuts, particularly given the political sensitivity surrounding major spending programs. While Musk's specific targets remain unclear, libertarian groups aligned with the Trump administration have expressed interest in reducing government benefits. Additionally, agencies that have investigated Musk's companies in the past may be vulnerable to DOGE's influence.
Read more »
Vivek Ramaswamy Exits Trump's DOGE Amidst Friction and Rumored Ohio Gubernatorial BidVivek Ramaswamy has resigned from co-leading Trump's Department of Government Efficiency (DOGE). Ramaswamy reportedly plans to run for Ohio governor, necessitating his departure from the non-governmental initiative focused on cutting 'wasteful' government spending. Sources suggest internal friction and a lack of active participation from Ramaswamy led to his exit.
Read more »
Ukraine Allegedly Targets Turkstream Gas Pipeline in Bid to Disrupt Russian Energy SuppliesRussia accuses Ukraine of launching a drone attack on the Turkstream gas pipeline, the last remaining conduit for Russian gas to Europe. Moscow claims the attack aims to halt energy deliveries to European nations. While Ukraine remains silent, the incident highlights the ongoing energy war and geopolitical tensions in the region.
Read more »
Dogecoin Faces Potential Lawsuit, Price Correction ExpectedDogecoin (DOGE) rallies nearly 5% on Monday, but faces the risk of a decline as a lawsuit alleging it violates federal advisory committee laws is likely to be filed against Elon Musk's DOGE. The lawsuit, uncovered by the Washington Post, claims DOGE should be considered a FACA (Federal Advisory Committee Act) entity due to its operations and staff recruitment. Traders are on edge, with derivatives data showing a decline in open interest and options volume, along with liquidations of long positions. While DOGE's price trend remains upward, the lawsuit could trigger a price correction.
Read more »