Trump Promises More Payments to Voters Ahead of Midterms

Trump as he boards Air Force One en route to Nebraska (Reuters)
By Yuval Rosenberg and Michael Rainey

It's the first Monday in October, which means that the Supreme Court started a new term. With Election Day just four weeks away as of tomorrow, President Trump is holding a rally tonight in Grand Island, Nebraska, continuing a string of visits to drum up votes in states and districts that are usually safely in the Republican column. Trump is scheduled to return to Texas later this week and then visit Alabama on Saturday for a college football game. Will he keep promising to send Americans checks if they vote the way he wants? Here's what you need to know.

Trump Keeps Promising Payments to Voters Ahead of Midterms

With the midterm election looming, President Trump is ramping up his effort to convince Americans that voting for Republicans will pay off in a very direct way, thanks to his largesse.

Late Friday night, Trump announced that he is giving more than 20 million seniors on traditional Medicare a $90 rebate to help cover the monthly cost of the healthcare program. The one-time payments for Medicare Part B enrollees, which will cover less than half of the standard monthly premium of $202.90, are expected to arrive in early October via direct deposit or paper check.

Not all enrollees are eligible for the payments. Those on privately run Medicare Advantage plans - fully half of the roughly 64 million people on Medicare - are not eligible, nor are those who also receive assistance from Medicaid.

The payments will come from the Medicare Improvement Fund, which the White House said contains $2 billion in uncommitted funds. In the words of the legislation that created the fund, as highlighted by the Congressional Budget Office, the fund is intended "to make improvements under the original fee-for-service program under parts A and B for individuals entitled to, or enrolled for, benefits under part A or enrolled under part B."

The White House highlighted the unusual nature of the payments. "Established in 2008, no Administration has ever utilized or made payments from the Medicare Improvement Fund," a White House fact sheet says. "President Trump believes that Medicare Improvement Funds should be used to directly help people on Medicare, not special interests, and is returning healthcare dollars back into the hands of the American people to benefit them and their individual healthcare needs."

More than one payment promise: Trump has also pledged to pay $5,000 to each adult citizen if Republicans successfully maintain control of Congress in the midterms. After introducing the idea of the "Trump dividend" in early September, the president repeated his pledge on his social media platform Saturday.

"If Republicans win the House of Representatives and the Senate, I'm going to give all adult citizens in the United States of America $5,000," Trump said in a video post. "Thank you, and I look forward to signing those checks!"

Trump has not explained where the money for such payments would come from, nor how the payments would be authorized, though he did repeat his wildly exaggerated claim that he has drawn $21 trillion in new investment to the United States since returning to office. The promised $5,000 payments would cost more than $1.2 trillion in total, which Trump framed as a small portion of the unrelated and unproven investment total he often touts.

On a smaller scale, Trump is moving ahead with a plan to send $500 refund checks to about 1 million Americans in 30 states who get their health insurance through the federal exchanges established by the Affordable Care Act, or Obamacare. The checks reportedly are accompanied by a letter from Trump that states that the Biden administration overcharged some Obamacare participants.

According to Reuters, 71% of the Obamacare refund payments are going to people in states that are political battlegrounds, which could help tip the balance of close races. In New Hampshire, for example, where there are competitive races for the House and for governor, about 28,400 people will get the checks, or roughly 2% of the population.

A familiar pattern: Trump is no stranger to promising payouts to voters at government expense. Early in his second administration, he floated the idea of a $5,000 "DOGE dividend" that would share the bounty of savings that Elon Musk was supposed to deliver through massive cost-cutting throughout the federal government. Those checks, like the savings, never materialized.

Trump also raised the possibility of a payment of $2,000 per person based on the revenues generated by his tariff blitz in 2025. But the Supreme Court ruled that his "reciprocal tariffs" were unconstitutional, and no payments were ever made.

A few weeks before the 2020 election, during his first term, Trump attempted to make another healthcare-related payout, promising millions of Medicare enrollees $200 prescription-drug cards. But there was no funding for the cards, and they were never sent.

Chart of the Day: No Tax Windfall

Corporate profits are soaring to record highs, but the federal government's revenues from corporate taxes are declining, thanks in part to generous tax write-offs claimed by tech firms on their massive investments in artificial intelligence.

The dynamic raises the possibility that AI could worsen the fiscal situation of governments - despite hopes that the technology will contribute to faster economic growth, and thus higher tax revenues. Instead, as The Economist notes, AI may create value in parts of the economy that are relatively lightly taxed - corporate profits and capital gains - while weakening labor, the current source of much of the government's revenue, as it displaces workers.

"AI could raise the cost of providing public services, even as it increases demand for them," The Economist says. "Governments may then find themselves needing more tax revenues just as these get harder to obtain."

The solution to the problem may lie in restructuring the tax code. "Among economists a consensus is ... emerging that changes to existing taxes may be preferable to new levies," The Economist writes. "This is especially true of taxes on capital income, which includes corporate profits, dividends and realized capital gains. If AI lives up to the hype, related capital income could be truly enormous."

Economist chart showing tax revenue

Quote of the Day: GOP Healthcare Cuts Hand Dems a Wedge Issue

"We're seeing the reality now that hospitals are closing, people are losing their coverage, people who were able to afford the first few months of health care have now dropped their health care because they can't afford it anymore. The receipts are coming in."

− Leslie Dach, founder and chair of the liberal advocacy group Protect Our Care, in a Politico piece detailing how Democrats are already scoring political points as the result of Republican cuts to Medicaid and other safety net programs that the GOP had timed to kick in after this year's midterm elections.

With millions of people losing Obamacare coverage or Medicaid, healthcare affordability has become a key campaign issue - and, many Democrats say, a key liability for Republicans.

"The political bill for Republicans' health care agenda is coming due earlier than they'd hoped," Politico's Alice Miranda Ollstein writes, adding, "Even amid the rising cost of food, gas and housing, polling shows these health trends remain top of mind for voters, and their frustrations with the party currently in power may drive them towards Democrats in November."

While some Republicans are on the defensive about the cuts, others are reportedly more eager to defend the party's policies and healthcare messaging, including a pitch to crack down on costly waste and fraud.

"Despite recent polling showing voters trust Democrats over Republicans on health care by 22 points," Ollstein notes, "some GOP candidates in close races insist that Democrats' health agenda - particularly the calls for a Medicare for All-style government-run health system - will prove more unpopular with voters than the Republican-backed cuts now underway."

Read more at Politico.

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