Producer price inflation is up 5.4% from a year ago, but that is nothing compared with the inflation in vote-buying. Last fall, President Donald Trump was promising Americans $2,000 dividend checks to compensate them for the costs of his tariff regime. On Wednesday night at the Republican midterm convention, Trump upped the ante to $5,000 — a 150% increase that dwarfs every other inflation indicator.
At this rate, a 2028 vote will cost the next Republican candidate $31,250. This simply isn’t sustainable.
On some level, Trump’s promise to send every adult citizen a $5,000 check, but only if Republicans maintain control of the House and Senate, should be treated as what it is: pure political theater with no real-world relationship to what Trump’s actual legislative agenda would be should Republicans beat the odds and maintain control of both chambers of Congress.
But our country is in dire fiscal shape, and Trump’s theatrical proffered election bribe makes it opportune to underscore just how much our federal government is already overspending, even before we add another $1.3 trillion in deficit-financed Trump dividends.
The Congressional Budget Office projects a $1.9 trillion deficit this year, equal to 5.8% of GDP. Debt held by the public is projected to reach 101% of GDP, while net interest costs are expected to hit $1 trillion. By 2036, the CBO expects annual interest costs alone to exceed $2 trillion.
These deficits are not being driven by tax cuts but by spending.
As we noted last month, federal revenue has grown substantially over the past quarter-century. More tellingly, the CBO expects Washington to collect revenue equal to 17.5% of GDP this year, slightly above the 17.3% average over the past 50 years. Federal spending, meanwhile, is projected to reach 23.3% of GDP, well above its 21.2% historical average. By 2036, spending is projected to rise to 24.4% of GDP, driven largely by Social Security, Medicare, and interest on the debt.
That means Washington is already spending about $1.8 trillion more than it collects this year, before anyone writes a new trillion-dollar check. Rising interest costs make that imbalance harder to correct because more federal revenue must go simply to servicing past borrowing.
Voters nevertheless have every reason to be frustrated with the economy. Inflation has eaten away purchasing power, energy prices are rising, and housing affordability is again deteriorating. On Thursday, Mortgage News Daily’s average 30-year fixed mortgage rate crossed 7% for the first time in 15 months, reaching 7.07%.
That is especially painful for young adults trying to buy a first home and start a family. Higher mortgage rates can add hundreds of dollars to a monthly payment, shrinking the pool of homes a young couple can afford and forcing many prospective buyers to delay home ownership. First-time buyers accounted for just 30% of existing-home purchases in August.
A $5,000 check may look like relief from those pressures, but if roughly 260 million adult citizens received one, the price tag would approach $1.3 trillion. Vice President JD Vance has suggested tariff revenue could help finance the plan, but existing tariff collections fall far short of the amount required. Without offsetting spending cuts, much of the difference would therefore be borrowed, which would drive inflation even higher.
The odds are Republicans will not retain both the House and Senate this November, so Trump will never have to make good on his $5,000 promise. But if Republicans do somehow pull off an electoral upset, they should oppose Trump’s plan or identify the $1.3 trillion in cuts to pay for it.