Trump promises Americans $5000 checks, but who pays?
In the face of the midterms election in America, Trump has recently stated that his government will hand out $5000 payouts if the Republican Party gets majority in congress. But where will this estimated $1.2 trillion come from? And what would the economic impact be, if the proposal were to be realized? Experts offer their perspectives.
"If the Republicans win, you win with us and you get $5,000.” Those words were uttered by none other than the President of The United States, Donald J. Trump, on September 9th 2026, as he promised to hand out checks to every adult if the GOP (Grand Old Party; the Republican Party) retains control of Congress.
This promise comes at a time, where surging costs of living remain a major concern for the average American, and the notion of receiving $5000 would seem like a pleasant relief. But not everyone is convinced.
For Joni Herman, a 71-year old woman living in Florida, the issues with affordability has markedly increased the last year. With that being said, she would currently not welcome a $5000 check from the government despite experiencing these rising living costs firsthand herself. She does, however, understand why some voters would be excited by the notion.
“Between tariffs and fuel prices, like a half a gallon of milk has gone up,” she says. “The fuel for diesel, for truck drivers and for farmers has gone up to the highest ever […] So he is banking on people, ‘Oh my God, I'm going to make $5,000. This is fantastic.’ Except people who understand it realize that it doesn't add up.”
What would happen if the $1.2 trillion is handed out?
According to Thomas Kemp, professor and chair of economics at the University of Wisconsin–Eau Claire, handing out such a large amount of money could come with consequences of its own.
“Very likely there’ll be some inflationary effects from this, because of course you’ll have over 100 million American adults all with a bunch of additional income in their pockets, all now competing for existing goods and services,” he explains.
In other words, if more money is in circulation among consumers, but there’s no equivalent increase in the amount of goods and services available, demand could then rise faster than supply. Overall this would essentially contribute to pushing prices even further up.
“And with more money, but no more things, then the price of things will go up […] which is what we call inflation.”
Where would the money come from?
As stated by Trump, the main arguments, which makes these handouts possible are “the tremendous growth” in U.S. economy along with “tariff revenue”. In Trump’s own words the U.S. is essentially doing so well economically that these checks would merely be a handout of the governments’ financial surplus.
J.D. Vance, Vice-President of the United States, has also backed Trump’s claims, and told Fox News on Wednesday that Americans will “share in some of the benefit of this incredible wealth that we’re creating.”
Senior Economist at the Tax Foundation, Alex Durante, does not see how revenue from tariffs could make this endeavor possible.
“If you would take the president literally and rebate $5,000 to 245 million adult citizens in the US, that would cost about 1.2, 1.3 trillion this year […] For context, the tariffs we estimate will raise about 1.4 trillion over the next decade.”
Essentially, the estimated tariff revenue of an entire decade done by the Tax Foundation would barely be enough to cover the cost of the checks for a single year, putting the U.S. in national debt.
“There really is no way that the math works,” Durante says. “The president would have to borrow money to fulfill his promise and that is going to exacerbate the deficit crisis further.”
Who ultimately pays for Trump's tariffs?
According to Alfredo Carrillo Obregon, trade policy analyst at the Cato Institute, financing the $5000 checks through tariffs would in many ways amount to redistributing money Americans have already paid.
“If you assume that it’s going to be funded through tariff revenue […] that tariff revenue comes from Americans who are paying the tariffs,” he explains. “So saying that you’re going to fund checks that you’re going to send out to Americans through this tariff revenue — it’s a weird form of redistribution in a certain way.”
Stated differently, the tariff revenue would not represent new wealth created by the government, but rather, it is money which is collected through taxes on imported goods. Some of those costs are ultimately passed onto American businesses and consumers through the higher prices.
Apart from the national debt, which Alex Durante emphasized could come as a result of handing out $1.2 trillion to Americans, the proposal would also come with a major contradiction in itself, as Carrillo Obregon hinted at, where Americans are paying part of the price through costs associated with tariffs.
For 71-year old Joni Herman, however, it's not just the economical aspect that alarms her, it is the prospect of the U.S. turning into a "banana republic", to use her exact words.
"It really reminds me of […] a banana republic," she says. "To me, it’s the same as trying to bribe people and buy votes. And that is not something I feel you do in a functioning democracy.”
