Tariffs are unpopular, prices remain stubbornly high and Americans are angry about President Trump's handling of the economy.
So Mr. Trump adopted a familiar political strategy: promising people money.
The White House is trying to allay Americans' economic fears by promising checks and other payroll payments next year, hoping the money could reassure voters who blame the president for their rising cost of living.
Mr. Trump, who will address the nation on Wednesday evening, has repeatedly floated the idea of sending one-time $2,000 rebate checks to many families, funded with money from his sweeping global tariffs. But he has not laid out a detailed plan for providing the rebates, an expensive policy that Republicans in Congress must approve and have not yet considered.
The president has also started hyping the tax refunds Americans are set to receive in 2026. For many people, those cash payments are expected to be larger than last year after Republicans passed major tax cuts in July.
Both Mr. Trump and members of his administration have regularly drawn an equivalence between the alleged tariff rebates and the enacted tax law. They have claimed the money could stimulate the economy and ease some of the financial burdens on families, even at a time when Mr. Trump claims much of the talk about affordability is a “hoax.”
“Next year is expected to be the biggest tax refund season ever, and we will return refunds from the tariffs because we took in literally trillions of dollars,” Trump said at a Cabinet meeting last week. “And we will give people a nice dividend in addition to reducing debt.”
But economists see it differently. Even if Americans were happy to receive a batch of new government-issued checks, the payments would do little to address the reasons prices remain so high – including the housing shortage that has driven up rents and mortgages and global tariffs that have made imports more expensive. And the money that could soon be floating around the economy could end up worsening inflation and undermining Trump's own economic goals.
Alex Durante, a senior economist at the Tax Foundation, said that simply “pumping money” into the economy – without other underlying changes – risks “just creating a cycle where you continue to get higher prices.”
The White House did not respond to a request for comment.
The push to send money is a retaliation for a strategy from Trump's first term, when he worked with Congress to stabilize the economy at the height of the coronavirus pandemic. As part of a series of rescue packages, the president implemented two rounds of stimulus packages, a costly move that proved politically popular and economically beneficial — even if the spending later contributed to rapid price increases.
But the 2020 pandemic unleashed the worst economic crisis since the Great Depression, a constellation worse than the malaise that has spread across Americans and their finances today. The latest signs of stress emerged on Tuesday when the government reported a rise in the country's unemployment rate.
Mr. Trump's top aides quickly dismissed that gloomy report as they worked to portray the economy as robust and growing. They stepped up their rebuttal as the president prepared to give a prime-time speech Wednesday to announce his agenda and “everything he intends to continue to do to continue to serve the American people,” White House press secretary Karoline Leavitt said Tuesday. The president will also discuss North Carolina's economy later this week.
Recently, Mr. Trump has used similar appearances to emphasize his work to put money in Americans' pockets.
At his appearance last week in Mount Pocono, Pennsylvania, Mr. Trump highlighted the roughly $12 billion in emergency aid his administration had newly committed to farmers. He said the aid, intended to help farmers struggling financially because of the president's trade war, came “directly from tariff funds.”
Mr. Trump had previously teased that he would use the same tariff revenue to give all Americans “a little rebate,” a refrain he repeated in December amid concerns that U.S. tariffs had driven up consumer prices. At one point, the president put the amount at “at least $2,000 per person” and excluded those with higher incomes, although the administration gave no further details about its plans.
The calls for a tariff rebate were similar to an idea Mr. Trump proposed early in his term, when he considered paying a dividend to families based on the savings of the Department of Government Efficiency (DOGE) as it cut through the ranks of the federal government. That ultimately never came about.
Nor has Mr. Trump made a concerted push for tariff rebates in Congress. But some conservatives have encouraged the White House to take a different approach entirely, perhaps by temporarily reducing the payroll taxes paid by workers and employers, a long-standing goal of some right-wing parties.
“You never want to just send checks to people who have nothing to do with work,” said Stephen Moore, a conservative economist who advised Trump in his first term and brought up the idea in a recent meeting with him. He said checks alone could “increase inflation, not decrease it.”
Tariff discounts could also prove costly, significantly reducing the roughly $200 billion the government collected in tariff revenue this year, according to new figures released Tuesday by U.S. Customs and Border Protection.
If the administration were to implement a version of Trump's proposal — a $2,000 rebate for people making less than $100,000 a year — it could cost the government nearly twice as much money as it collected in tariff revenue this year, according to the Yale Budget Lab.
The analysis, published in November, found the rebates would have a “muted” effect on inflation. But Martha Gimbel, executive director of the Yale Budget Lab, said it was difficult to give a more precise estimate given the uncertainty about the president's policies and the public's general unease about the state of the economy.
“One of the big questions for inflation right now is consumer expectations,” she said, adding that consumers may be more inclined to spend rather than save if they fear prices will rise in the future.
Treasury Secretary Scott Bessent gave few details about the Trump administration's thinking on Fox Business last month, saying that “everything is on the table.” He still predicted a “big spike” in economic activity early next year, when Americans would see significantly larger refunds on their federal tax returns.
Much of this year's tax law was dedicated to preserving a series of tax cuts that Republicans passed in 2017, but some additional cuts will be unusually visible next year. This includes Trump's campaign promise not to tax tips and overtime, which went into effect retroactively in early 2025.
The Internal Revenue Service did not update its withholding tables this year to reflect the changes, meaning tax cuts will appear when Americans file their taxes. As a result, many Americans will receive larger-than-average tax refunds in early 2026, rather than having slightly less taxes withheld from their paychecks throughout the year.
About two-thirds of individual applicants receive a tax refund. On Tuesday, Mr. Bessent told Fox Business that there would be “significant refunds to working American households in the first quarter.”
Don Schneider, deputy head of policy at Piper Sandler, an investment bank, estimates that the size of the average refund, which was $3,052 for individuals in 2025, could rise by about $665 next year.
The biggest benefits will be concentrated among the relatively small populations that Mr. Trump has targeted for the new tax breaks. For example, fewer than 3 percent of households are expected to benefit from the new tip tax credit, and even the increase in the standard deduction for seniors, a much broader demographic, is estimated to be 13 percent.
The most generous new tax cut next year will go to those who take the increased state and local tax deduction. This is 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 will be relatively small.
Still, lump sum payments like a tax refund can be particularly politically significant, political scientists say, giving Republicans a chance to help improve the public's view of the economy.
“There's a lot of fear among Republicans about affordability and the midterm elections. There's this idea that the One Big Beautiful Bill is old news,” said Mr. Schneider, a former House Republican aide. “But none of that has shown up in people's pockets yet, and it's about to happen on a large scale.”