Elon Musk, billionaire entrepreneur and part-time politician, recently called for the elimination of the US penny due to its inefficiencies in production and transactions. The debate over the penny’s relevance has been ongoing among economists and policymakers, but Musk’s high-profile endorsement may bring renewed attention to the issue.
The cost of producing pennies far exceeds their face value, with the US Mint spending around 2.7 cents to manufacture a single penny. This means that taxpayers are losing money every time a new penny is minted. Musk believes this is an obvious waste of resources and sees it as a case of “common sense” in business.
Furthermore, pennies slow down transactions by requiring businesses and consumers to count and handle these low-value coins. By removing the penny, cash transactions could move faster, benefiting both businesses and customers. Additionally, inflation has eroded the penny’s purchasing power, making it largely obsolete.
Musk’s influence on this issue is significant due to his massive following as CEO of Tesla, SpaceX, Neuralink, and other ventures. His opinions carry weight socially and politically, and he may be able to push policymakers to seriously consider eliminating the penny.
If the US were to follow Musk’s suggestion, several changes would occur, including rounding transactions to the nearest five cents, reducing production costs by millions of dollars each year, and faster cash purchases without the need to count pennies. While it remains to be seen whether policymakers will act on this issue, Musk’s call to eliminate the penny is rooted in logic, efficiency, and financial pragmatism.
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Source: https://www.foxnews.com/opinion/3-reasons-why-elon-musk-wants-get-rid-penny