The US saved $179 million by removing the 1 cent coin.

An anti-waste think tank led by billionaire Elon Musk is aiming to cut US federal spending on costly coin minting.

In a post on social network X on January 21, the Office of Government Efficiency (DOGE), co-led by billionaire Elon Musk, said that the US spends about 3 cents to mint a 1 cent coin, which is an unnecessary expense, according to CBS News.

Billionaire Elon Musk is leading President Donald Trump's anti-waste advisory board.

"It takes more than 3 cents to produce a 1 cent coin and this will cost American taxpayers more than $179 million in fiscal year 2023. The Mint will produce more than 4.5 billion coins in fiscal year 2023, about 40% of the 11.4 billion coins produced for circulation," DOGE announced.

The cost of minting coins has risen dramatically over the years. The U.S. Mint's 2024 annual report found that it costs about 3.7 cents to produce and distribute a one-cent coin.

The penny is made of zinc and coated with copper. The price of zinc fluctuates from year to year, but a ton of zinc today costs twice as much as a ton of zinc in 2016. The high cost of production has led many politicians to propose phasing out the penny, but there is also opposition.

The Federal Reserve Bank of Richmond said in 2020 that retiring the penny would be costly as transactions were rounded to the nearest 5 cent. "For a small purchase or item, rounding up or down can make a big difference in price," the bank said.

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In 2012, Canada stopped minting 1 cent coins, and according to a 2018 economic analysis, Canadian consumers pay about $3.27 million more at convenience stores each year due to the higher rounded prices.

On the other hand, using 1 cent coins also causes some disadvantages because buyers and sellers have to spend time and effort counting change while there is a saying that time is money.

In addition to the 1 coin being expensive to mint, each 5 coin also costs 14 coins to create and that could be a potential target for DOGE to aim for.

President Donald Trump said DOGE will recommend cutting excessive regulations, cutting wasteful spending and restructuring federal agencies. Elon Musk said the advisory group aims to cut $500 billion in annual federal spending.

On January 20, President Trump signed an executive order officially establishing DOGE, which is part of the executive branch of government and focuses on upgrading information technology systems to maximize government efficiency and productivity. DOGE co-leader Vivek Ramaswamy recently announced that he is leaving the advisory board to run for governor of Ohio.

Source: https://thanhnien.vn/ti-phu-musk-co-muc-tieu-moi-my-do-ton-179-trieu-usd-nho-bo-dong-1-xu-185250123141457486.htm