The greater significance of Trump’s $5K election bribe

Robert Robb

Submitted photo/Robert Robb

The cost of Trump’s election bribe is estimated at $1.2 trillion. The federal government is already running an annual deficit of $2 trillion. Trump and congressional Republicans have made no meaningful move to lower an unsustainable debt trajectory.”

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OPINION — Any claim the Republican Party had to fiscal conservatism was forfeited long ago. Any doubts should be extinguished by Donald Trump’s “dividend” proposal.

At the GOP’s midterm convention, Trump said that every adult citizen would receive $5,000, but only if the GOP retained control of both the House and the Senate in the midterm election.

The proposal is offensive, reckless and irresponsible. After that, I’d have to get critical.

Let’s begin with the offensiveness.

Giving every adult citizen $5,000 is either good policy or bad policy. (Spoiler alert: it’s reckless and irresponsible). Its virtue doesn’t depend on whether Republicans or Democrats are in control of Congress when the dust settles after the votes are counted in November.

Republicans are now in control of both chambers. If it is good policy, why is it not something to try to push through while Republicans are still in control? And if Democrats take over one or more chambers, why wouldn’t it be a priority in a lame-duck session, assuming Democrats would be opposed?

There is utterly no policy reason why the $5,000 per adult check is contingent on the outcome of the November election. It’s a naked political inducement: Vote Republican, get a check. Vote Democrat, no check.

Is there a crasser insult that could be mounted to American democratic sensibilities? I can’t think of one. But, then again, Trump has 49 days to top it. At this point, I wouldn’t bet against it.

As a political maneuver, I suspect this one will badly backfire. Now, there is another Trumpism every GOP candidate will have to respond to: Do you favor or oppose Trump’s proposed financial award contingent on voters retaining GOP control of both chambers of Congress?

The only rational answer would be something along these lines: The president is out of his friggin’ mind. That ain’t gonna happen.

Instead, there will be, and is occurring already, much hemming, hawing and harrumphing.

“The proposal faces difficulty in Congress.” Hem, haw and harrumph.

“I haven’t seen the details.” Hem, haw and harrumph.

Not a fiscally conservative response to such a reckless and irresponsible proposal.

The cost of Trump’s election bribe is estimated at $1.2 trillion. The federal government is already running an annual deficit of $2 trillion. Trump and congressional Republicans have made no meaningful move to lower an unsustainable debt trajectory.

Investment markets are already sending out distress signals. Investors are asking for a higher rate of interest to loan money to the American national government than they are asking from the government of Greece. Ponder that one for a moment.

There are two threadbare attempts to provide some facade of credence to Trump’s election bribe. The first, advanced most prominently by J.D. Vance, is this: The tariffs will pay for the checks.

Now, Trump’s tariff regimen is a moving target. The tariff on Irish whiskey just went from 10% to nothing because Trump was struck by an afflatus while on a golf course he owns in the country, at which the country’s open championship was being held. Hard to produce a reliable estimate on such an erratically moving target.

However, estimates on the existing Trump tariff rates only produce about one-fifth of the estimated cost of his election bribe. And here’s the unacknowledged paradox, at least in Trumpland: Trump’s tariffs will only produce large revenues if they fail in their purported purpose, causing American consumers to purchase domestically manufactured goods rather than foreign ones.

The second threadbare argument is being championed by U.S. Treasury Secretary Scott Bessent: Don’t worry yourself silly about the deficit and mounting debt. We can grow our way out of them.

If the annual deficit were $1 trillion rather than $2 trillion, there might be a colorable argument here. The right set of policies might increase annual economic growth to the 3% target Bessent cites. However, given where we are, a 3% economic-growth rate only stabilizes the status quo, keeping it from getting even worse. And, a reminder, the status quo has the United States government paying more to borrow than the Greek government does.

There is also, at this point, no reason to believe that Republicans would enact the set of policies that might produce 3% annual growth, even if they didn’t face any Democratic opposition. In addition to abandoning fiscal conservatism, Republicans increasingly are abandoning the free-market principles that could produce such growth.

Trump is pursuing a policy of state capitalism, having demanded an ownership stake in at least 30 companies so far. His state capitalism is sliding into crony capitalism, as companies grovel for tariff relief and regulatory favoritism, while Trump administration officials hock the wares of companies in which the government has a stake.

The two leading candidates to succeed Trump, Vance and Secretary of State Marco Rubio, are both free-market skeptics, favoring forms of aggressive, government-led industrial policy. There is a track record for government-led industrial policies in mature economies. They don’t produce 3% growth rates.

Economist Herbert Stein once observed: “If something cannot go on forever, it will stop.” The federal government cannot forever borrow 6% of GDP on an annual basis. When and how it stops is unknown.

At present, there is no political constituency for fiscal discipline. If one develops, there is at least one plausible Democratic response. Democrats favor a European-style social democracy. Financing a European-style social democracy requires a European-style tax system, including a broad-based, value-added tax.

Having abandoned fiscal conservatism and free-market economics, what would the Republican response be? Higher tariffs, more government ownership of private companies, bigger “dividend” checks?

Republicans have painted themselves into a corner of policy incoherence if fiscal discipline becomes an important political issue.

And it will. In an odd way, Trump’s election bribe might hasten the day.

Retired Arizona journalist Robert Robb opines about politics and public policy. Reach him at robtrobb@gmail.com. Please submit comments at yourvalley.net/letters or email them to AzOpinions@iniusa.org. We are committed to publishing a wide variety of reader opinions, as long as they meet our Civility Guidelines.