Dean Baker, Common Dreams

Trump's desperate new gambit should have even Republicans screaming bloody murder

I learned basic arithmetic skills in third grade. I wasn’t exceptional — everyone in my public school third-grade class learned them. Of course, we all can now use computers to have calculations done for us in a fraction of a second. But still, somehow, we have major national debates that show zero understanding of even the most basic arithmetic.

The latest example is the $2,000 tariff dividend check that Trump is promising us. The arithmetic here is about as simple as it gets. We have roughly 340 million people in the country. Let’s say 10 percent don’t get the check because they meet Trump’s category of “high-income.”

That leaves over 300 million people getting Trump’s $2,000 checks. That comes to more than $600 billion. Trump’s tariffs are raising around $270 billion. That means we will be paying out $330 billion more in Trump tariff dividend checks than he is raising in tariff revenue. That would add $270 billion to the deficit — this coming from the same guy who is making an obsession of paying down our national debt.

And just to be clear, we were already looking at a budget deficit for 2026 of $1.8 trillion. If we add $330 billion, the deficit for the fiscal year will be $2.1 trillion. To put this in simple language that even a reporter for a major national news outlet can understand, Trump is proposing to add $2.1 trillion to the debt in 2026. He is not paying it down.

I acknowledge not being a deficit hawk and am not terrified by a deficit of this size, which is roughly 7 percent of GDP. But I suspect most of the politicians in Washington are, and certainly anyone who thinks we need to be paying down the debt should be screaming bloody murder.

But watching the reaction in major media outlets, there seems almost no appreciation of the fact that Trump was floating what would ordinarily be considered a very large increase in the deficit. In fact, if Trump were to give this tariff dividend check every year over the next decade, it would add close to $4 trillion to the debt (counting interest payments), almost as much as the big tax cut Congress approved earlier this year.

It’s also worth comparing Trump’s tariff dividends to other items in the news. The government shutdown was in large part over the $35 billion in annual payments for enhanced subsidies for people buying insurance in Obamacare exchanges. Trump and Republicans in Congress claimed that we didn’t have the money to pay for these subsidies. Trump’s tariff dividend checks would cost more than 17 times as much as the enhanced insurance subsidies.

To make another comparison, Trump saved us around $6 billion a year by shutting down PEPFAR, the program that has saved tens of millions of lives by treating people in Africa for AIDS. This means that Trump’s tariff dividend checks will cost us 100 times as much as the AIDS program that he said we couldn’t afford.

And just to throw in one more comparison, the annual appropriation for public broadcasting was $550 million. Trump’s tariff dividend checks would cost more than 1,000 times as much as the government’s payments for public broadcasting.

People can differ in their views on how important it is to save lives in Africa or provide people here with health care. They may also differ in their assessments of how important deficits are. But it really would be good if media outlets could make knowledge of third grade arithmetic a job requirement for reporters who deal with budget issues.

It should be their job to provide meaningful information to the public on the topic. Letting someone talk about $2,000 dividend checks, and also about paying down the debt, is a sick joke.

Dean Baker is the co-founder and the senior economist of the Center for Economic and Policy Research (CEPR). He is the author of several books, including "Getting Back to Full Employment: A Better bargain for Working People," "The End of Loser Liberalism: Making Markets Progressive," "The United States Since 1980," "Social Security: The Phony Crisis" (with Mark Weisbrot), and "The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer." He also has a blog, "Beat the Press," where he discusses the media's coverage of economic issues.

Trump says his mega MAGA ballroom won't cost voters a dime. Here's why that's a lie

Donald Trump and his Republican sycophants have been busy telling us that we shouldn’t be bothered by Trump’s demolition of the White House East Wing and his plans for a now $350 million ballroom. (The price tag keeps rising, it had been $200 million.)

While many of us were upset about Trump’s destruction of a historic landmark with zero consultation from anyone, the consolation is supposed to be that taxpayers are not footing the bill. Trump says he is raising the money from his friends and corporate sponsors.

Apparently, we are supposed to be relieved that people seeking favors from Trump are paying for the ballroom rather than taxpayer dollars. As David Dayen pointed out in a piece in The American Prospect, these contributions are likely to prove very costly to the American people.

Dayen goes through the public list of donors (some are anonymous) and found off the bat the big tech companies, Google, Meta, Microsoft, Apple, and Amazon. These companies have all sorts of occasion to seek government contracts and regulatory favors from a Trump administration that has openly said it favors its friends in such matters.

The list includes many other companies looking for favors, such as Hewlett Packard and Union Pacific, both looking for regulatory approval on major mergers. And then there are crypto folks who always want more love from Trump as they expand their scams.

This naked corruption is the biggest cost to the public from Trump’s big ballroom, but it is not the only one. If we’re only concerned about the budgetary impact, it’s important to remember that taxpayers pay a price for the “generosity” of rich people. They deduct their contributions from their taxable income.

The current top tax rate is roughly 40 percent. (This includes the Medicare tax, which applies to all income of rich people.) If the full $350 million were coming from individuals, this means that we would be getting $140 million less in taxes from them because of their contributions to Trump’s mega ballroom.

From a straight budgetary perspective, the public would be better off if Trump built something more tasteful in the $100-$140 million range, using taxpayer dollars, than the mega MAGA monstrosity he is actually attaching to the White House. (What will this cost to demolish?)

In fairness, many of Trump’s contributions come from corporations who are only taxed at a 21 percent rate. Also, it’s likely that some of Trump’s contributors cheat, and don’t pay any taxes anyhow, so the deduction doesn’t mean anything to them. But none of us should think that just because the ballroom is paid for by contributions, it doesn’t cost the government anything.

Jon Queally is managing editor of Common Dreams.

Why this agonizing government shutdown is absolutely, definitely, completely Trump's fault

Since there is a lot of confusion surrounding the shutdown, I thought it would be useful to go over some of the main points as I understand them. I will not pretend this is a comprehensive account, but there are some issues that are reasonably clear.

First, when Republicans claim that they are proposing a “clean” continuing resolution, they are ignoring a trillion-pound elephant in the room. In the past, when Congress passed a continuing resolution, it meant that the money appropriated in the resolution would be spent on the designated items. Under President Donald Trump, this is no longer true.

Trump has decided that because he was elected with a huge mandate (almost as large as Hillary Clinton’s in 2016) normal rules don’t apply to him. He has decided to unilaterally refuse to spend money appropriated by Congress.

He has done this through two routes. The first is through the recission process. Under this process, Congress can vote to reverse appropriations that were made in prior spending bills. Under the rules of the Senate, a recission bill cannot be filibustered so it can pass with just 50 votes. This was the process that Trump used to eliminate much of the foreign aid budget, as well as funding for public broadcasting.

The use of the recission process strips the Democrats of the filibuster power they hold with normal appropriations. The process had rarely been used in prior decades because it effectively means undermining the deals that were made to get an earlier budget bill approved.

But the situation gets even worse with the newly invented “pocket recission.”

With a pocket recission, Trump effectively just refuses to spend appropriated money and then tells Congress towards the end of the fiscal year, “What do you know, I never got around to spending the money you appropriated in this or that area.” Congress never gets a chance to vote since the fiscal year is reaching its conclusion. It would have to reappropriate new money in the next fiscal year if it wanted the money to be spent.

In the old days, this pocket recission likely would have been ruled unconstitutional, since it makes a mockery of Congress’ power to spend, but it’s not clear what this Supreme Court would say. At this point, Trump has gotten away with pocket recissions covering several billion dollars of spending. There is certainly no guarantee that he will not do pocket recissions again in the new fiscal year.

Trump’s recent decisions to “cancel” items like a train tunnel between New York and New Jersey would also fit into this category of pocket recission. The possibility of a pocket recission means that any deal on spending with Trump is pointless, since any time he gets angry about something he can totally ignore his commitment, sort of like his trade deals.

This is why it is disingenuous to say that what the Republicans are offering is a “clean” continuing resolution. If there is no commitment not to reverse appropriations through recission, and to prevent Trump from doing pocket recissions, Democrats cannot prevent any item in the continuing resolution from being subsequently cut. This means that they effectively have no control over the budget once the continuing resolution is approved.

The treatment and rules on recissions would ordinarily be the sort of thing that would be negotiated prior to the approval of a continuing resolution, but there were no negotiations.

Speaker Mike Johnson (R-La.) sent the House home shortly after July 4, in large part to avoid any vote on releasing the Epstein files, and Trump ordered Republican senators not to negotiate. There was only one negotiating session involving the congressional leaders and Trump one day before the end of the fiscal year. When no agreement was reached, we got the shutdown.

The Republicans had obviously prepared for the shutdown. They immediately started screaming about how the shutdown was because Democrats wanted to spend trillions providing Obamacare to “illegals.” They knew this was a lie but apparently hoped they could sell it anyhow. (Undocumented immigrants do not qualify for health care coverage, except through a Reagan-era law requiring that emergency rooms treat anyone in need of care. This obviously is not the issue, since Republicans have not even proposed repealing this law.)

It seems they have mostly given up on the lie, which Speaker Johnson bizarrely claimed to have in writing, and instead are harping on how Obamacare has been a disastrous failure. This also flies in the face of reality. The share of the population that is uninsured fell from 18 percent in 2010 to around 8 percent at present.

More importantly, the ACA ended the ability of insurers to discriminate based on preexisting conditions. In the pre-ACA insurance market, people with serious health conditions, like cancer or heart disease, would have to pay ridiculous prices for insurance, or were unable to get coverage at all. The ACA changed this, requiring that all people within an age group were charged the same.

This change is a huge deal not only for the people who directly benefit by now being able to get affordable insurance, but really the entire pre-Medicare age population. In the pre-ACA world, most of the working age population got insurance through their employer. This meant that even people with serious health issues could get insurance in their employers’ pool.

But if a heart attack or some other health problem prevented them from working, they would be forced to get individual insurance as a person with a serious health condition. The ACA effectively provides insurance that people can get insurance.

The ACA also sharply slowed health care cost-growth. The cost of Obamacare, Medicare, and Medicaid in the years since the ACA passed came in far below projections. The Republicans are obviously hoping that people either do not remember or do not know about the state of the insurance market before the ACA. Few who do would want to go back to that world.

The other game that Republicans are playing is the claim that they would be happy to negotiate, once the Democrats pass the continuing resolution. This is a silly game, since there is zero reason to expect Republicans to negotiate in good faith, once the Democrats have no leverage. They had all summer and September to negotiate but refused to do so.

In fact, there is absolutely no reason they can’t negotiate now. In prior shutdowns both parties had no problem carrying on negotiations. Trump himself even negotiated in the 2019 shutdown, the longest in history. If there is some principle about not negotiating during a shutdown, the Republicans have just invented it now.

Anyhow, it appears the shutdown will continue until there is a major reversal of positions by one side or other. In the Democrats’ case, it would mean giving up any leverage they have on spending. In the Republicans’ case, it would mean agreeing to negotiate.

Dean Baker is the co-founder and the senior economist of the Center for Economic and Policy Research (CEPR). He is the author of several books, including "Getting Back to Full Employment: A Better bargain for Working People," "The End of Loser Liberalism: Making Markets Progressive," "The United States Since 1980," "Social Security: The Phony Crisis" (with Mark Weisbrot), and "The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer." He also has a blog, "Beat the Press," where he discusses the media's coverage of economic issues.

Irony oozes from Trump's latest self-made scandal

Bill Pulte is the head of Federal Housing Finance Agency (FHFA), the agency that oversees Fannie Mae and Freddie Mac. He has been in the news recently over his allegations that prominent opponents of President Donald Trump committed mortgage fraud. Most recently, Pulte has put Federal Reserve Board Governor Lisa Cook in his crosshairs, claiming that she listed two homes as principal residences on mortgage applications.

Trump immediately used this allegation as a basis for trying to fire Cook, even though the Fed is supposed to be an independent agency outside of the president’s control. Governor Cook sued Trump over his firing effort, and the courts will ultimately decide whether this is within his power.

At this point, it is important to remember that Cook has not even been indicted for anything, much less convicted. We only have an allegation from Mr. Pulte.

It is also worth noting the irony of Trump, who was convicted in a civil trial for putting false information on loan forms, trying to fire someone for listing two homes as principal residences. Among the items that Trump put on his loan form was the claim that his 10,000 square foot condo was actually 32,000 square feet. Perhaps President Trump is offended by the pettiness of Cook’s alleged crime.

While the validity of Pulte’s allegations will have to be determined by the courts, the real scandal is Pulte himself. He is supposed to be running the agency that oversees the processing of tens of millions of mortgages by two huge quasi-public agencies. We are not supposed to be paying him to rifle through mortgage documents to find and disclose dirt that Trump can use against his political opponents.

The media really need to be directing some serious questions in Pulte’s direction.

First and foremost, how did he happen to discover the mortgage abuses that he alleges were committed by NY Attorney General Letitia James, Sen. Adam Schiff (D-CA), and now Governor Lisa Cook? Were these “discoveries” the result of random inspections done by agency staff?

Furthermore, was he looking through non-public mortgage files to gather this information?

Also, why did he make this information public when he uncovered it, instead of going through normal channels. If he had followed established procedures, he would have turned over the information to the agency’s inspector general, who would then turn if over to the Justice Department, if they determined it was appropriate. The first time the public would hear about it was when an indictment was issued.

What reason does Pulte have for not following normal procedures?

Pulte really needs to come clean on this.

He should also come clean on his holdings of Pulte Group stock, the huge housing construction company started by his grandfather. It may be the case that conflicts of interest are almost a job requirement in the Trump administration, but many of us still think that government officials should be working for the public, not trying to fatten their pocketbook.

If Pulte helps Trump get his wish and a Trump-controlled Fed lowers interest rates, it would provide a big boost to the Pulte Group’s profits. That hope would give Pulte a strong motivation to try to hasten the day when Trump appointees dominate the Fed’s Open Market Committee that sets interest rates.

Anyhow, there is definitely a big scandal here — but it involves Bill Pulte, not Lisa Cook. The media really need to take notice.

Dean Baker is the co-founder and the senior economist of the Center for Economic and Policy Research (CEPR). He is the author of several books, including "Getting Back to Full Employment: A Better bargain for Working People," "The End of Loser Liberalism: Making Markets Progressive," "The United States Since 1980," "Social Security: The Phony Crisis" (with Mark Weisbrot), and "The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer." He also has a blog, "Beat the Press," where he discusses the media's coverage of economic issues.

There is one Trump truth: all his henchmen are incompetent liars

We all know and expect that a president’s top appointees are picked in large part because of their willingness to carry out a president’s agenda. But usually these are people with some experience in the areas that they are overseeing. Insofar as this is not the case, they can generally rely on the high-level career officials in the departments or agencies under their control to make sure that necessary tasks get accomplished.

Unfortunately, this is not the case now. The main and possibly only qualification for Trump’s top appointees is the ability to tell blatant lies with a straight face. He has picked people who not only have no background in the areas they oversee, they don’t even have the most basic understanding of their responsibilities. And in many cases they have fired or marginalized the career people with expertise.

Starting at the top, Trump picked a former Fox talk show host with an alleged drinking problem, Pete Hegseth, to be his Secretary of Defense. Secretary Hegseth apparently didn’t know that he shouldn’t be making war plans on unsecured channels and without knowing who was included in the conversations. He apparently also didn’t know that his wife should not be included in the discussions.

Trump has a Treasury Secretary, Scott Bessent, who claims he doesn’t know that tariffs (import taxes) are taxes. Since tariffs are among the oldest form of taxes, long predating the income tax, this is a pretty elementary point that a Treasury Secretary would be expected to know.

Kristi Noem, Trump’s Homeland Security Secretary, didn’t know what habeas corpus is. Since that is basic right guaranteed by the Constitution, it would be rather important for the person controlling the largest federal police force to be familiar with the concept.

While knowledge of their areas may not be a strong point for top Trump officials, lying in front of TV cameras is an area of real expertise. We see this constantly.

We just saw Attorney General Pam Bondi tell us that there is no Jeffrey Epstein client list. This was after telling us back in February that the list was sitting on her desk and promising that it was soon to be released.

After Trump released his “Liberation Day” tariffs, which included a steep tariff on the uninhabited Heard and McDonald Islands, Commerce Secretary Howard Lutnick insisted this was not a mistake and an indication of a rushed job. Instead, he said the tariffs were necessary to prevent transshipment from other countries to escape the taxes Trump was imposing.

This is obviously an absurd claim since there were many uninhabited islands that escaped taxation. In addition, while the problem of transshipment to avoid tariffs is real, it is not one that can be solved by putting a tariff on imports from islands inhabited by penguins and seals.

China and other countries whose exports are subject to high tariffs can and will ship them through countries that face much lower import taxes. If our customs agents can’t recognize that we are not actually importing cars and television sets from uninhabited islands, they surely will not be able to detect that the goods coming from Thailand or Indonesia were actually manufactured in China.

Trump appointees do have a remarkable ability to lie. RFK Jr. can tell us that discouraging people from getting the measles vaccines has nothing to do with the largest measles outbreak in decades. They all tell us that we can reduce Medicaid spending by $800 billion over the decade (roughly 10 percent), without throwing anyone off the program. And former DOGE boss Elon Musk told us 20 million dead people were getting Social Security benefits.

But it seems that none of them can do their jobs, and since they have fired or sidelined most of the high- level civil servants with expertise, these jobs are not getting done. Hundreds of people just died in Texas because of this failure, and we are virtually certain to see far worse in the future. As much as Trump might insist otherwise, incompetence is not a virtue.

Dean Baker is the co-founder and the senior economist of the Center for Economic and Policy Research (CEPR). He is the author of several books, including "Getting Back to Full Employment: A Better bargain for Working People," "The End of Loser Liberalism: Making Markets Progressive," "The United States Since 1980," "Social Security: The Phony Crisis" (with Mark Weisbrot), and "The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer." He also has a blog, "Beat the Press," where he discusses the media's coverage of economic issues.

Trump is doing 'everything possible' to show his contempt for his voters

Donald Trump seems to be doing everything possible to show his contempt for ordinary working people, many of whom voted for him last fall. Just after signing his big bill, which gave massive tax breaks to the rich while taking away health care insurance for 12 to 17 million people, Trump announced that he will hit workers with one of the largest tax increases ever.

The tax increases take the form of the import taxes, or tariffs, that Trump plans to impose on the goods that we import from the rest of the world. While we won’t know the actual size of these taxes until Trump sends us his letters, based on what he has said to date, it will almost certainly be several trillion dollars if they are left in place over a decade. Taking a low-end figure of $2 trillion, that would come to $16,000 per household over the next decade.

Whatever Trump may say or think, people in the United States will be paying his tariffs.

To be clear, Trump insists that other countries will pay the tariff, but there is no reason for anyone to care about whatever idiocy comes out of Trump’s mouth. Trump said that there are 20 million people, with reported birthdays putting them over 115, getting Social Security (The number of dead people getting checks is in the low thousands.).

He said China doesn’t have any wind power; it leads the world in wind power. And Trump said global warming isn’t happening and slashed the budget for monitoring weather. Now 70 people are dead in Texas from floods for which they and state officials were not adequately warned.

The dead people in Texas, their families, and the rest of the country don’t have time for Donald Trump’s make-believe world. It doesn’t matter that Trump says other countries will pay the tariffs. Who knows what Trump actually believes, but in reality-land we pay the tariffs.

This is not hard to demonstrate. We have data on import prices through May of this year. This is before many of Trump’s tariffs hit, but items for most countries already faced a Trump tax of at least 10 percent, with much higher taxes on goods from China, as well as aluminum and cars and parts.

If other countries were paying the tariffs, then the prices of the goods we import, which do not include the tariff, would be falling. They aren’t.

To start with the big picture, the price of all non-fuel imports was 1.7 percent higher in May of 2025 than it had been in May of 2024. That doesn’t look like exporters are eating the tariffs. If we want a base of comparison, non-fuel import prices rose by just 0.5 percent from May of 2023 to May of 2024. If we want to tell a story of exporters eating the tariffs, we’re going in the wrong direction.

If we look to motor vehicles and parts, the numbers again go in the wrong direction. Import prices are 0.7 percent higher than they were in May of 2024. If we turn to aluminum the story is even worse. The price of aluminum imports was 5.4 percent higher in May of this year than a year ago.

There is a small bit of good news on apparel prices. This index for import prices was 2.9 percent lower in May of 2025 than the prior. But before celebrating too much, it’s worth noting that the price of imported apparel goods had already been dropping before Trump’s tariffs. It fell 0.3 percent from May of 2023 to May of 2024.

It’s also worth noting that much of this apparel comes from China, where items now face a 54 percent tariff. Insofar as our imported apparel comes from China, this 2.9 percent price decline would mean exporters are eating just over 5 percent of the tariff. That would mean that if Trump imposed import taxes of $2 trillion over the next decade, we will pay $1.9 trillion of these tariffs.

In short, whatever Trump may say or think, people in the United States will be paying his tariffs. They amount to a very big and not beautiful tax increase on ordinary workers.