Inflation held steady in August, rising 0.4% for the month and 3.4% year over year. Cumulative inflation since January 2021 is over 28%, and much higher on some goods and services. President Donald Trump just promised to make that much worse.
Okay, so that’s not how he put it, but it will be the effect of his pitch Wednesday night.
“Here is my promise,” he told the crowd in Dallas, “if the Republicans win the House of Representatives and the United States Senate, I will issue a dividend to every adult citizen in the United States of America for $5,000.”
Vice President JD Vance dutifully backed up his boss. “If you keep us in power and allow us to continue to do these things, then you’re going to share in some of the benefit of this incredible wealth that we’re creating in the United States of America,” Vance said. “I don’t think it’s a controversial idea.”
Actually, Trump’s naked attempt to bribe voters is a terrible, horrible, no good, very bad policy proposal, and I hope, even if Republicans eke out a win in November, that they don’t go along with it.
Yesterday, in evaluating Trump’s remarks and the broader GOP midterm convention, Douglas Andrews called Trump’s proposal “brilliant,” explaining why it puts Democrats on their heels. Politically, he has a point. Democrats do this all the time, winning votes by promising healthcare, daycare, public transportation, and down the Democratic Socialists of America wishlist. In a sense, Trump, the ultimate showman, is just beating them at their own game, taking the varnish off and promising cash as a “dividend” for all the awesome policies he’s implemented. Maybe it’ll get folks to the polls for Republicans.
However.
Desperation is a stinky cologne, and this reeks.
Trump is basically saying his tariffs bring in so much money that it should benefit Americans. That’s (A) not true, and (B) it’s money we’re paying out in the first place. Tariffs are taxes on imports, and American consumers pay those taxes. This year, they have generated roughly $200 billion in revenue, while the annual deficit will likely top $2 trillion. Trump cited investments companies plan on making in the U.S., but those are promises, not cash in the bank.
Where is the $1.2 trillion Trump plans to spend on “dividends”? Nobody knows. Besides, Trump has previously promised to pay for a bunch of other stuff (like paying off the debt) with tariff money. You can’t pay off debt and add to it at the same time.
The national debt now exceeds $40 trillion.
In 2020 and 2021, at the height of the pandemic, Trump and then Joe Biden sent direct payments to Americans, spending roughly $930 billion in three installments to ameliorate job losses caused by government shutdowns. That influx of cash chasing limited goods and services lit the wildfire of inflation, sending it as high as 9.1% in June 2022. As I noted above, the cumulative cost has been enormous.
President Trump now wants to spend more than $1.2 trillion all at once. National Review’s Charles C.W. Cooke notes that’s “more than the entire federal discretionary budget for 2026.” Would someone please explain why a massive infusion of Trump Bucks won’t reignite rampant inflation this time?
“Like a successful company returning cash to its shareholders,” said the White House on Thursday, “the Trump Dividend is possible only because of President Trump.”
He is not the CEO of America, which is not a corporation — and it sure as heck doesn’t ever turn a profit. But there may be no better example of Trump behaving as a brash businessman instead of a constitutionally limited president. A razor-thin congressional majority of Republicans is unlikely to approve the payments, but Trump says he probably doesn’t even need Congress. “I will issue...” he said. Okay, why not send the payments now? Because he does need Congress.
What’s most frustrating is that Trump’s statement about Congress at least intellectually continues the authoritarian trend set by Barack Obama and Joe Biden. Constitutional conservatives should want no part of this.
The same goes for another major Trump administration proposal that’s getting too little attention.
Matthew Continetti sums it up in The Wall Street Journal: “The Health and Human Services Department is preparing a rule that would grant stay-at-home parents access to the Child Care and Development Fund, a $12 billion program that currently subsidizes child care for low-income workers. Since the 1990s, the fund has provided eligible parents some $9,000 a year to help pay the cost of child care. Most recipients are single moms.”
The administration’s goal is to encourage marriage through federal policy. Now, don’t get me wrong — I love stay-at-home moms. My wife stayed home and homeschooled our kids when they were young. Moms are under-appreciated and underpaid.
But this borrows far too heavily from the Left’s playbook.
“Who works or does not work; who takes care of a child; or who takes a child to childcare is the family’s business,” wrote former Congressional Budget Office Director Douglas Holtz-Eakin. “It is certainly not the place of the federal government to put its thumb on the scale using taxpayer dollars.”
Similarly, Erick Erickson writes, “Republicans spent 30 years arguing that welfare made people dependent on government.” He explains the undesirable effects this could have on families, including fathers turning down promotions or raises and moms forgoing even part-time work to avoid losing benefits.
However, there is disagreement on the Right.
Personalities from Michael Knowles to Meghan Basham to Andrew Kolvet support the Trump administration’s proposal, essentially insisting that if the money’s going to be spent anyway, it might as well achieve pro-family ends.
The Heritage Foundation is on that side of the ledger, too.
“The welfare state already exists,” argues Heritage Foundation President Kevin Roberts. “The subsidies already exist. And conservatives do not have the votes to dismantle either. Until that changes, taxpayer dollars should reward family formation, not subsidize its decline.”
Heritage Vice President Roger Severino added, “For 30 years the federal government has given parents only one choice, which is requiring everyone to work outside the home and pay for other people to care for their kids. Families wanting to raise their kids at home have been left in the dust.”
Call me old school, but a “conservative” welfare state is not remotely conservative or constitutional. In fact, one could argue that the Trump administration’s plan to dole out $5,000 here and $9,000 there just repurposes the DSA platform of income redistribution.
Some folks like to complain about Washington’s “uniparty,” and with proposals like a “dividend” and welfare for families, it’s not hard to see why.
