President Trump’s new Department of Government Efficiency, led by billionaire Elon Musk, has set its sights on reducing government spending, and one target is the U.S. penny, which now costs more than three cents to produce.
According to a tweet from the department’s official account, the U.S. spent $179 million in 2023 making pennies and nickels. The Mint produced over 4.5 billion pennies that year, making up about 40% of the total 11.4 billion coins created for circulation.
The penny has been costing more to make than it is worth for the last 19 years. In 2024, it cost 3.7 cents to produce a penny, according to the U.S. Mint. Back in 2016, it only cost 1.5 cents to make a penny, but this has changed due to rising metal prices, manufacturing costs, and transportation expenses. The zinc used to make pennies has doubled in price since 2016, which has contributed to the higher production costs. Pennies are primarily made of zinc, with only a thin copper coating to make them look like they are made of copper.
The nickel is the only other U.S. coin that costs more to make than its face value. In 2023, it cost 11.5 cents to produce each nickel. This is due to the increasing prices of the metals used to create the coins, along with other production costs.
The Department of Government Efficiency, under Elon Musk’s leadership, has a goal to cut $500 billion in wasteful government spending each year. One area they are focusing on is the cost of making coins, which has been higher than expected for years.
The goal of these efforts is to make the government more efficient and reduce unnecessary expenses. The penny, in particular, has been a symbol of this inefficiency, costing taxpayers millions of dollars each year. The department is now looking for ways to address this issue and cut down on the money spent producing coins like the penny.
