Trump: Doge could return 20% of the tax money and heat inflation

Trump: Doge could return 20% of the tax money and heat inflation

President Donald Trump has announced that he could consider a plan that could return 20% of the savings identified by Elon Musk Department of Government Efficiency (Doge). This could make the country's ongoing efforts more difficult in the fight against the persistently high inflation.

The Doge Dividend: A new idea for US citizens

"There is even a new proposal in which we spend 20% of the dog savings on American citizens and use 20% to reduce debt," said Trump during his speech at the Fii Priority Summit in Miami on Wednesday.

there is a risk of revival of the US economy?

The presentation of a so-called "Doge dividend", which is sent to every taxpayer in the form of a check and financed by dog savings, was publicly addressed on Tuesday by a user on Musk's social media platform X. Musk replied to the contribution that he would “contact the president”.

inflation in the USA: an urgent problem

Although Trump did not give any precise details, such a payment could heat up the US economy again at a time when inflation stubbornly lies above the target of 2%. In January 2025, inflation rose to 3%, the highest level since June 2024.

past of direct payments to the Americans

This would not be the first time that Americans received direct payments from the federal government. During the pandemic, over 476 million payments with a total value of $ 814 billion were paid to households.

While Trump's first term in March 2020 and December 2020, qualified Americans received $ 1,200 and 600, in March 2021, further aid for $ 1,400 were paid out under the government of Joe Biden.

causes of inflation in the USA

A little more than a year after the last payments, consumer prices in the USA achieved a 41-year high. Numerous factors such as disorders in the supply chains, panda mie -related demand increases and Russia's invasion in Ukraine 2022 contributed to this inflation. However, some economists are responsible for the overheating of the economy.

economic effects of the economic stimulus package

Research of the St. Louis Fed estimate that state economic stimulus packages made 2.6 percentage points of the annual inflation rate of 7.9% registered in February 2022. The St. Louis Fed researchers emphasized that generous fiscal support contributed to an increase in demand for consumer goods during pandemic, while industrial production did not react quickly enough.

Current challenges of the US economy

Although the US economy is in a different situation than after the start of pandemic, the Federal Reserve continues to fight against inflation that has occurred since then. According to the Bureau of Labor Statistics, consumer prices rose half a percentage point in January, which is the largest monthly increase since August 2023.

Trump about inflation and its plans

In an interview with Fox News, Trump blamed the bidet government to inflation. "Inflation is back," said Trump. "I had nothing to do with it." He promised to combat inflation on the "first day" of his presidency, but warns that not only "Doge-Dividend" checks could endanger these plans. Economists warn that other economic priorities of the Trump administration, such as tariffs and mass deportations that could drive up prices of everyday goods and services.

public debt and their effects

Some economists argue that the fight against inflation cannot be successful without reducing public debt. The United States' national debt was a total of $ 35.5 trillion in the 2024 financial year, which represents an increase of $ 1.4 trillion compared to 2023. In addition, the ratio of US debt and GDP in the 2024 financial year increased by 2 percentage points compared to the previous year, which indicates that the debt burden is becoming increasingly difficult for the economy.

doge as a possible solution?

Trump claimed that Doge, which he launched last month, would "save the taxpayers billions of dollars every single day" by uncovering cases of fraud and abuse in the government.

The reporting of CNN was supported by Elisabeth Buchwald and Elise Hammond.