Trump's Federal Reserve Chair candidate Hassett: Tariff rebate checks "should be on the table for discussion"

One of the candidates for the Federal Reserve chair selected by President Trump, Kevin Hassett, the director of the White House National Economic Council (NEC), stated to the media on Wednesday that there is room for the U.S. Congress to consider introducing "tariff rebate checks" next year. Hassett said during a discussion hosted by U.S. media on Wednesday: "We have made significant progress in reducing national debt, so I think it is reasonable to consider what policies we can push in the so-called budget reconciliation bill for 2026." He mentioned that Trump has been advocating for the proposal of rebate checks. "As tariff revenues continue to come in without triggering stagflation, I believe this idea will definitely be put on the table for discussion." Hassett also indicated that consumer price pressures may not have been fully controlled after the price surges of the past few years. He stated: "We lost control of inflation not long ago, and now the situation is more manageable—perhaps not completely in place yet." He noted that due to the surge in prices while wages did not rise in sync, real income has declined, leading to "people having reason to say they are facing affordability issues." He also mentioned that Alan Greenspan criticized fiscal spending as "reckless" during his tenure as Federal Reserve chair and emphasized the inflation risks associated with such policies. When asked if he would publicly criticize like Greenspan if he were to become the Federal Reserve chair, Hassett told the media that he would not label inflation as "transitory" if it is not "transitory," alluding to the current Federal Reserve chair Jerome Powell's use of that term during the price increases in 2021. Hassett further stated that Trump's policies are currently driving real wage increases. "But if fiscal policy is as irresponsible as the last Congress, you will definitely see inflation rise again." According to federal budget data, U.S. debt continues to rise in dollar terms. The government recorded a $1.78 trillion deficit for the fiscal year ending in September, which is nearly unchanged from the $1.82 trillion deficit projected for 2024. Republican Lawmakers Resist Some Republican lawmakers are resisting Trump's cash distribution plan. Media reports indicate that this is the latest sign of a rift between Trump and the Republican-controlled Congress, also showing that Trump's control over Washington is weakening. However, Trump seems unaffected by the opposition from Republican lawmakers. On Wednesday, at the U.S.-Saudi Investment Forum in Washington, Trump stated: "We will distribute at least $2,000 in 'dividends' to low-income and middle-income people." Jodey Arrington, chairman of the House Budget Committee, told the media that he expressed to Treasury Secretary Scott Bessent during Wednesday's meeting that he would prefer to use tariff revenues to reduce the deficit rather than for $2,000 checks. Arrington told reporters that he believes a better way is to put money in people's pockets through "growth-promoting policies" and warned that these checks could drive up inflation Senate Majority Leader John Thune said on Tuesday that he hopes tariff revenues can be well utilized, specifically mentioning their use to reduce the U.S. deficit. Republican Senators Rand Paul and Ron Johnson firmly oppose sending checks, while other lawmakers like Shelley Moore Capito have also expressed reservations. Paul stated on Tuesday evening: "I think it's crazy to send people money when we still have a deficit." Although the White House acknowledges that legislation may ultimately be needed from Congress to implement this measure, government officials are considering options to bypass Congress and issue checks directly. Analysts believe this approach would again circumvent Congress's "power of the purse" and could exacerbate tensions between the executive branch and Congress. External analysts have also indicated that the amount of the checks would easily exceed actual tariff revenues and could further worsen the already large budget deficit. Tobin Marcus of Wolf Research wrote in a report: "We believe this plan is extremely unlikely to pass. We do not think a second budget reconciliation bill focused on $2,000 stimulus checks can garner the near-unanimous support needed from Republicans." According to preliminary analysis from the nonpartisan organization Committee for a Responsible Federal Budget (CRFB), the amount distributed under Trump's dividend plan would far exceed the revenue currently generated from tariffs in the U.S. The organization estimates that these dividends would cost about $600 billion. Meanwhile, data from the U.S. Treasury shows that as of September 30, tariff revenues this year were approximately $195 billion. CRFB stated that if tariffs remain unchanged, economists expect they could generate about $300 billion in revenue annually