Trump Backtracks, Says He Will Pay for Controversial Campaign-Style Ads

Trump in Baltimore
Reuters
By Yuval Rosenberg and Michael Rainey

President Trump took a break from his recent campaign blitz to visit the Baltimore area for an event touting a new multi-billion-dollar deal for submarine manufacturing by the military technology company Anduril Industries, which was founded by billionaire Palmer Luckey, a noted Trump supporter. "Right here in Sparrows Point, you'll build the next generation of American submarines, including autonomous subs, torpedo tubes, and critical components for our cutting-edge Virginia-class attack submarines - the greatest and quietest ever built," Trump said.

Here's what else is happening with Election Day four weeks away.

Trump Backtracks, Says His PAC Will Pay for Campaign-Style Ads

President Trump announced Monday evening that he will no longer use government funds to pay for pro-Trump, campaign-style TV ads currently airing nationwide and will instead rely on his super PAC to cover the cost of the messages that began appearing in late September.

"I have decided to do the Patriotic Ads, among others, and pay for them myself, and with money I raised for MAGA, Inc.," Trump wrote on his social media platform.

The federal government has already paid more than $10 million to run the ads, some of which feature Trump pledging to defend the nation from various purported enemies, including communists and socialists - terms that Trump has used repeatedly to denigrate Democrats. The ad campaign has been paid for through a $20 million contract signed by the Department of Homeland Security, using funds for "commemorative events."

Patriotism or propaganda? The White House has maintained that the ads are public service announcements and not political because Trump is not running for office, but Democrats and even a few Republicans have criticized the use of public funds to cover the cost.

Even as Trump announced that he was reversing course on the funding issue, he continued to defend his actions. "The Radical Left is upset with the fact that I am taking Ads, which I consider to be a positive promotion for our Great U.S.A., and paying for them with U.S.A. money," he said. "This is a rather standard thing to do."

Trump's critics have described the ads as blatant propaganda that violates any number of federal laws governing the use of taxpayer money. They have called on the Trump administration to take them down.

On Tuesday, Democratic Sen. Patty Murray, who has proposed legislation to cut funds from the White House if it runs political ads, said she wants Trump to repay the government for the money his administration has used. "This was historic corruption, and the President announcing he will illegally coordinate with a Super PAC won't cut it," Murray said on X. "Trump MUST refund the American people for these taxpayer-funded ads."

White House officials reportedly said Tuesday afternoon that Trump's pledge to cover the cost of the ads will apply only "moving forward," and does not include any reimbursement.

Senate Democratic Leader Chuck Schumer called on Trump to reimburse the funds. "First, Trump steals money from taxpayers to fund his propaganda," Schumer wrote on X. "Then, he illegally coordinates with a Super PAC to keep that propaganda going. And to top it all off, he won't reimburse taxpayers for the money he stole. Trump must return this money to the American people, and there must be a full investigation into this gross waste and abuse of taxpayer dollars."

There's little doubt that Trump has the money to cover the cost. As of last month, Trump's super PAC, MAGA Inc., had about $415 million on hand. However, as Schumer's comments suggest, using that money to pay for the ads may create new headaches for the president. As The New York Times notes, it is against the law for an officeholder to personally direct the spending of a super PAC.

Chart of the Day: Tariffs and Inflation

A new paper from researchers at the Federal Reserve Bank of New York and Columbia University finds that the tariffs imposed by President Trump added 2.9 percentage points to consumer goods inflation by February 2026 - and without those tariffs, the price of goods would have fallen slightly.

According to the analysis, a 10% increase in tariffs results in a 2.6% rise in the price of goods. Roughly two-thirds of that increase comes from a direct pass-through of higher prices paid by importers to consumers. The remaining third comes from higher prices of domestically made goods, as producers face higher input prices and less competition. The latter dynamic takes longer to play out, as long as a year, the researchers said.

Chart showing tariff impact on inflation

Number of the Day: $105.6 Billion

Speaking of President Trump's tariffs, they don't seem to be accomplishing one of their main goals: shrinking the trade deficit by boosting domestic production.

The U.S. trade deficit rose in August, hitting a 17-month high of $105.6 billion, the Commerce Department reported Tuesday. The 13.7% increase from July was driven by elevated imports of crude oil, gold and computer chips used to produce artificial intelligence.

Some analysts say the persistence of the trade deficit shows that, given high labor costs in the United States, there is no viable alternative to cheaper foreign-made goods. "Despite the administration's economic policies which have jacked up the tariff-related costs of many imported goods, America is just as dependent as ever on foreign-produced goods," Christopher Rupkey, chief economist at FWDBONDS, told The New York Times.

Brad Setser, a senior fellow at the Council on Foreign Relations who studies trade and sovereign debt, noted that economists have been telling Trump that his tariffs won't revive domestic manufacturing in any significant way. "To repeat an old line, in the battle between Trump's tariffs and conventional macroeconomics, conventional macroeconomics is currently winning," Setser said on X.

Trump Admin Pushes to Link Transit Funding to Birth and Marriage Rates

The Trump administration is proposing changes to an infrastructure grant program that would tie federal transit funding to birth and marriage rates, giving preference to communities with rates above the national average.

As Politico's Sam Ogozalek reports, the Federal Transit Administration formally proposed a plan this month to "revamp a multibillion-dollar program that helps state and local authorities fund infrastructure projects such as rail improvements and new bus lanes."

Under the plan, the Federal Transit Administration would cover an additional 5 percentage points of a project's cost if the average birth rate in the area is more than 1% above the national average. It would cover another 5 percentage points if marriage rates top that threshold as well. Areas that have birth and marriage rates equal to the national average or up to 1% higher could see the federal cost share boosted by as much as 6 percentage points. Places where the average birth and marriage rates are within 1% below the national average would get smaller 1-percentage-point federal boosts.

"Moving forward, the federal government is focusing on smart, affordable projects with high ridership. If you want federal funding, your project needs to align with where communities and families are actually growing," the Transportation Department said in a statement to Politico.

The plan, Ogozalek writes, would fulfill a priority of Transportation Secretary Sean Duffy, who first introduced the idea early last year. Shortly after being confirmed for his Cabinet post, Duffy, who has nine children, produced a memo that ordered the department's activities to prioritize benefits to families and be guided by "cost-benefit requirements and data-driven decisions." President Trump and others in his administration have also put an emphasis on raising a declining national fertility rate.

The top Democratic appropriator in the Senate slammed the administration plan as part of the administration's culture wars.

"Tying funding for transit projects to marriage rates and how many babies a woman has is the sort of bizarre and dystopian idea you'd expect in a TV show, not actual policy put forth by the U.S. government - yet here we are," Sen. Patty Murray told Politico.

Peter Rogoff, who led the Federal Transportation Administration during the Obama administration, called the proposal ludicrous.

"Does anyone really believe that there are couples out there saying, 'Hey, sweetheart, you and I should get married and raise a passel of kids because a dozen years from now, maybe they'll build light rail out to our neighborhood?'" he told Politico.

Rogoff and others have said that the administration's criteria are likely to hurt blue states. The Associated Press reported last year that, according to 2022 data from the Centers for Disease Control and Prevention, the 14 states with the highest fertility rates backed Trump in the 2024 election while the bottom 11 and the District of Columbia went for Democrat Kamala Harris.

"On its face, it's social engineering. But clearly and indisputably, it is a dagger aimed at blue states," Democratic Sen. Richard Blumenthal of Connecticut said last year about Duffy's memo. "It is patently discriminatory if you look at the numbers. This criteria was designed to punish blue states and coerce states to change their lawful policy on tolls, vaccines and immigration."

The public comment period for the new plan is slated to end on November 16.

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