Tariffs are unpopular, prices remain stubbornly high and Americans are souring on President Trump’s handling of the economy.
So Mr. Trump has reprised a familiar political strategy: promise people cash.
The White House is trying to tamp down Americans’ economic anxieties by dangling the prospect of checks and other paydays next year, hoping that the money might assuage voters who blame the president for their rising cost of living.
Mr. Trump, who is set to address the nation on Wednesday night, has repeatedly teased the idea of sending one-time $2,000 rebate checks to many families, funded using money collected from his sweeping global tariffs. But he has not devised a detailed plan for providing the rebates, an expensive policy that Republicans in Congress must approve and one that they have not yet considered.
The president has also begun hyping up the tax refunds that Americans are slated to receive in 2026. For many people, these cash payments are expected to be larger than they were last year, after Republicans adopted a sprawling set of tax cuts in July.
Both Mr. Trump and members of his administration have periodically drawn an equivalence between the supposed tariff rebates and the enacted tax law. They have claimed the money could bolster the economy and alleviate some of the financial strains on families, even at a time when Mr. Trump maintains that much of the talk about affordability is a “hoax.”
“Next year is projected to be the largest tax refund season ever, and we’re going to be giving back refunds out of the tariffs, because we’ve taken in literally trillions of dollars,” Mr. Trump said at a cabinet meeting last week. “And we’re going to be giving a nice dividend to the people, in addition to reducing debt.”
But economists take a dimmer view. Even if Americans were to delight in a series of new government-issued checks, the payments would hardly address the reasons that prices remain so high — including a shortage in housing that has driven up rents and mortgages and the global tariffs that have made imports more expensive. And the money that may soon be sloshing around the economy could end up worsening inflation, undermining Mr. Trump’s own economic goals.
Alex Durante, a senior economist at the Tax Foundation, said that simply “pumping money” into the economy — without any other underlying changes — threatened to “just generate a cycle where you continue to get higher prices.”
The White House did not respond to a request for comment.
The scramble to send money is a reprisal of a strategy from Mr. Trump’s first term, when he worked with Congress to stabilize the economy at the height of the coronavirus pandemic. Over a series of rescue packages, the president enacted two rounds of stimulus checks, an expensive move that proved politically popular and economically beneficial — even if the spending later contributed to a rapid rise in prices.
But the pandemic in 2020 incited the worst economic crisis since the Great Depression, a more dire set of circumstances than the malaise that has settled over Americans and their finances today. The latest signs of stress appeared on Tuesday, when the government reported an uptick in the nation’s unemployment rate.
Quickly, Mr. Trump’s top aides shrugged off that dour report as they worked to portray the economy as robust and growing. They mounted their rebuttal as the president prepared to deliver a prime-time Wednesday speech to promote his agenda and “all he continues to plan to do to continue delivering for the American people,” Karoline Leavitt, the White House press secretary, said on Tuesday. The president will also speak on the economy in North Carolina later this week.
Recently, Mr. Trump has used similar appearances to emphasize his work to put money in Americans’ pockets.
Appearing last week in Mount Pocono, Pa., Mr. Trump highlighted the roughly $12 billion in emergency aid that his administration had newly earmarked for farmers. He said the aid, meant to help farmers struggling financially because of the president’s own trade war, came “right out of the tariff money.”
Mr. Trump had previously teased that he would tap the same tariff revenue to provide “a little rebate” to all Americans, a refrain he repeated into December amid concerns that U.S. duties had edged consumer prices higher. At one point, the president pegged the amount as “at least $2,000 a person,” excluding those with higher incomes, though the administration did not unfurl any additional details about its plans.
The calls for a tariff rebate resembled an idea that Mr. Trump had proposed at the start of his term, when he mused about paying a dividend to families based on savings extracted by the Department of Government Efficiency, or DOGE, as it slashed the ranks of federal government. That ultimately never materialized.
Similarly, Mr. Trump has not made a concerted push in Congress for tariff rebates. But some conservatives have encouraged the White House to pursue other paths altogether, perhaps by temporarily reducing the amount that workers and employers pay in payroll taxes, a longtime goal for some on the right.
“You never want to just send checks to people that aren’t related to working,” said Stephen Moore, a conservative economist who advised Mr. Trump in his first term and raised the idea in a meeting with him recently. He said checks alone could “increase inflation, not reduce it.”
Tariff rebates could also prove expensive, cutting deeply into the roughly $200 billion that the government has collected in customs revenue this year, according to new figures released by U.S. Customs and Border Protection on Tuesday.
If the administration were to follow through with a version of Mr. Trump’s proposal — $2,000 rebates to people who earn less than $100,000 annually — it could cost the government almost two times more money than it has collected in tariff revenue this year, according to the Yale Budget Lab.
Its analysis, published in November, found that the rebates would have a “muted” effect on inflation. But Martha Gimbel, the executive director of the Yale Budget Lab, said it was hard to offer a more precise estimate, given the uncertainty surrounding the president’s policies and the public’s general unease with the state of the economy.
“One of the big questions for inflation right now is consumer expectations,” she said, adding that consumers might be more inclined to spend rather than save if they feared prices were going to rise in the future.
Appearing last month on Fox Business, Scott Bessent, the Treasury secretary, offered few details about the Trump administration’s thinking, saying that “everything is on the table.” He still projected a “big bump” in economic activity at the start of next year, when Americans would start to see noticeably larger refunds from their federal tax filings.
Much of this year’s tax law was dedicated to maintaining a set of tax cuts Republicans passed in 2017, but a few additional cuts will be unusually visible next year. That includes Mr. Trump’s campaign promises not to tax tips and overtime, which retroactively took effect at the start of 2025.
The Internal Revenue Service did not update its withholding tables this year to reflect the changes, meaning that tax cuts will show up when Americans file their taxes. As a result, many Americans will receive larger-than-normal tax refunds in early 2026, rather than having marginally less tax withheld from their paychecks throughout the year.
Roughly two-thirds of individual filers receive a tax refund. On Tuesday, Mr. Bessent told Fox Business that there would be “substantial refunds to working American households in the first quarter.”
Don Schneider, deputy head of policy at Piper Sandler, an investment bank, estimated that the size of the average refund, which was $3,052 in 2025 for individuals, could increase by roughly $665 next year.
The biggest benefits will be concentrated among the relatively small populations that Mr. Trump targeted for the new tax breaks. Less than 3 percent of households are expected to benefit from the new tax break for tips, for example, and even the increase to the standard deduction for seniors, a much broader population, will go to an estimated 13 percent.
The most generous new tax cut next year will go to people who take the bumped-up state and local tax deduction, largely a group of wealthy people who live in predominantly blue states, according to Mr. Schneider’s analysis. Some tax cuts will be widely available but relatively small.
Still, lump sum payments like a tax refund can be particularly politically meaningful, political scientists say, giving Republicans a chance to help improve the public’s view of the economy.
“There’s a lot of angst among Republicans about affordability and the midterms, there’s this idea that the One Big Beautiful Bill is old news” said Mr. Schneider, a former House Republican aide. “But none of this has shown up in peoples’ pockets yet, and it’s about to in a big way.”
Tony Romm is a reporter covering economic policy and the Trump administration for The Times, based in Washington.
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