Article Directory
Generated Title: Trump's $2,000 Tariff-Funded Checks: A Promise That Doesn't Add Up
Donald Trump is at it again, floating the idea of sending Americans a cool $2,000, supposedly funded by those much-discussed tariff revenues. He took to Truth Social to proclaim this potential "dividend," quickly adding that the plan wouldn’t include "high income people!" And, of course, he made sure to label anyone against tariffs as "FOOLS!"
The idea, while politically appealing, immediately raises a few red flags – or perhaps, more accurately, triggers a barrage of flashing spreadsheet warnings. It’s like promising a free lunch paid for with pocket lint. Let's break down the numbers, shall we?
The Tariff Revenue Reality
The Treasury Department reported customs duties collected during the first three quarters of the year totaled $195 billion. Not a small sum, certainly. But here's where the discrepancy starts to widen. Erica York at the Tax Foundation estimates that if we cut off eligibility at $100,000 of income, around 150 million adults would qualify. (A quick back-of-the-envelope calculation puts the US adult population at around 260 million.) Giving each of them $2,000 would cost roughly $300 billion.
And that’s just the adults. If kids get a slice of the pie, the cost balloons even further. John Arnold, co-chair of Arnold Ventures, throws out a figure of $513 billion. Suddenly, that $195 billion in tariff revenue looks less like a treasure chest and more like a down payment on a very ambitious, and likely unfunded, policy proposal.
The problem isn't just the headline number, it's the net revenue. York also points out that after adjusting for the full budgetary impact of tariffs (things like reduced economic activity and increased costs for businesses), the net revenue raised is closer to $90 billion. $90 billion, compared to a $300-$500 billion payout. See the issue?
The Consumer Pays
Here’s a thought leap: How are these tariffs impacting the average American in the first place? Data from the Yale Budget Lab indicates that consumers were paying an average effective tariff rate of nearly 18% as of October—the highest since 1934. That's right, the consumer is effectively paying these tariffs. This isn’t some magical money tree; it's passed-on costs. I've looked at trade data for years, and this kind of direct consumer impact is unusually high.
This brings me to a personal observation. Remember the "Doge dividend" idea from earlier in the year? The one where Trump and Elon Musk floated the idea of a $5,000 check based on supposed savings from a "department of government efficiency?" It never materialized, and the national deficit actually increased. It feels like we’re seeing a repeat performance here.
It's also worth noting that similar stimulus check proposals have been floated by others, like Rep. Ro Khanna's suggestion of a $2,000 check for those making under $100,000. The difference, of course, is that Trump is explicitly tying his proposal to tariff revenue—a link that simply doesn't hold up under scrutiny. Trump weighs giving Americans $2,000 from tariff revenues in bid for support
A Stunt, Plain and Simple
This entire idea smells less like sound economic policy and more like a poorly calculated attempt to boost popularity. The numbers don't support it, the history suggests it's unlikely to happen, and the underlying economic principles are questionable at best.
The Emperor Has No Clothes (Or, More Accurately, No Budget)
The notion of funding a $2,000 stimulus check for most Americans with tariff revenue is, frankly, absurd. The numbers simply don't add up, and the proposal relies on a flawed understanding of how tariffs impact consumers. It's a promise built on sand, and anyone who believes it is probably buying beachfront property in Arizona.