President Trump, speaking at the Republicans’ midterm convention, pledged that if Republicans maintained control of the Congress in the November election every adult American will receive 5,000 dollars from the government.
President Trump said that the government could afford the estimated 1.3 trillion dollars cost “because we’ve done so well and because our country is making so much money.”
The truth is the economy is not doing well. Prices are rising faster than incomes. And, thanks to the Iran War, the price of diesel fuel has reached an average of over six dollars a gallon. This increases shipping costs, thus further increasing many prices.
The national debt now exceeds 40 trillion dollars, which is one reason why interest on Treasury bonds is at the highest level since 2007.
President Trump claims the 5,000 dollars payments can be financed with tariff revenue. The truth is that the government has not collected nearly enough tariff revenue to finance these payments.
Secretary of Commerce Howard Lutnick has suggested the government could raise the funds through actions including selling its shares in the tech company Intel. Selling those shares would only raise at most four percent of the cost of the payments. Nonetheless, the federal government should sell all the shares it has acquired in private companies. This corporatist policy distorts the market by incentivizing businesses to put pleasing politicians and bureaucrats ahead of pleasing consumers.
Some commentators have expressed outrage over President Trump’s attempt to bribe voters. These commentators have tended to ignore the fact that, since the rise of the welfare-warfare-regulatory state, most political campaigns are little more than legalized bribery. How else would you describe politicians who court support from the military-industrial complex with promise to deliver endless wars financed by ever-increasing Pentagon spending? Or court votes of farmers with promises of ever-increasing farm subsidies? Or court votes of senior citizens with promises concerning Social Security and Medicare? Or promise to those whose standard of living and prospect for economic advancement are harmed by the Federal Reserve’s destruction of the dollar that government will take care of them with food stamps, Medicaid, and government-subsidized housing?
This system of legalized bribery makes it impossible to make real spending cuts because every item in the federal budget has a constituency behind it. Politicians are convinced that their electoral success depends on them protecting this spending.
This system of legalized bribery cannot last much longer. The continued failure of Congress and presidents to cut spending will further efforts to replace the dollar as the world’s reserve currency. This will cause a major economic crisis that will force Congress to cut spending.
President Trump could avoid this fate by fulfilling his promise of no new wars and working with Congress to cut the bloated military budget. President Trump should also end all forms of corporate welfare and work with Congress to shut down all unconstitutional federal agencies. The savings from these cuts should be used to start paying down the debt and support those reliant on government programs during the transition away from the welfare state. Returning to local communities, private organizations, and churches the responsibility to help the less fortunate is more effective and compassionate than leaving the matter to government bureaucracies. Following this agenda would allow President Trump to “bribe” the people with peace, prosperity, and liberty.
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