President Donald Trump is again promoting the idea that tariffs are generating vast sums of money for the United States — enough, he claims, to fund $2,000 payments to many Americans while also paying down the national debt.
"All money left over from the $2,000 payments made to low and middle income USA Citizens, from the massive Tariff Income pouring into our Country from foreign countries, which will be substantial, will be used to SUBSTANTIALLY PAY DOWN NATIONAL DEBT," Trump said Monday on his Truth Social platform.
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It is not a new concept for the president, who has previously suggested some form of tariff-funded dividend. According to Kevin Hassett, director of the U.S. National Economic Council, the administration has been studying the idea.
"When we studied the matter in the summer ... we thought that deficit reduction might be the best use of those moneys," Hassett said. "But we've had a big surge in tax revenue — we've seen even a bit surplus in the latest monthly treasury. Because of the surge in tax revenues, I think that's a position that Congress and the president are reconsidering."
Trump has long argued that tariff revenue will be used to pay down the national debt, now at $38 trillion. He is still making that case, but he is also suggesting some of that money could go directly to the public.
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However, some questions arise about the proposal, including who would qualify for the payments, whether the $2,000 would apply per household or per adult, and if children would be included. There are also questions about how the math would work.
Trump claims the country is bringing in trillions of dollars from tariffs. Treasury Department data shows the United States collected $195 billion in total tariff revenue for the fiscal year that ended in September — a figure that includes tariff collections before Trump took office and before his April "Liberation Day," when he enacted sweeping new tariffs.
Whether these payments are possible will depend heavily on revenue assumptions and on congressional approval. When Americans received COVID-19 relief checks, the money was authorized through legislation passed by Congress and signed into law. Similar action would likely be required for any new payments to be issued.
