The checks that the Trump administration suggested giving to American taxpayers in light of savings made from the Department of Government Efficiency’s (DOGE’s) scrutiny of federal spending will be legislated through a reconciliation bill, White House Deputy Chief of Staff Stephen Miller said on Feb. 20.
“It’s all going to be worked on through the reconciliation process with Congress that’s going underway right now,” Miller replied. “As you’ve seen, the Senate’s moving a bill, the House is moving a bill. The President has great confidence in both chambers to deliver on his priorities.”
Trump had said on Wednesday that another 20 percent of DOGE savings could be used to pay down the nation’s debt, with another 60 percent not yet allocated. Miller said on Thursday that the leftover 60 percent of DOGE savings would be “cycled into next year’s budget.”
“Then it just lowers the overall baseline for next year. So in other words, you can just transfer into the next fiscal window and then lower the overall spending level. And that means that you can achieve a permanent savings that way, and that reduces the deficit,” he said.
Both the House and Senate are working on budget plans to fund the president’s policy initiatives. Due to the Senate GOP’s minimal 53-seat majority, Republicans need at least seven Democrats to invoke “cloture” on a bill to limit debate and push the bill to a final vote, since the cloture rule requires a two-thirds majority to end a filibuster.
As an alternative, the Senate GOP can pass a “budget reconciliation,” which allows it to pass budget legislation concerning taxation, spending, and public borrowing with a simple majority, but reconciliation bills exclude pure policy moves such as changes to immigration laws.
House Speaker Mike Johnson (R-La.) downplayed the idea of the Trump administration sending checks to American taxpayers from savings generated by DOGE cuts, calling it “politically beneficial,” while arguing it would contradict fiscally conservative policy considering the budget deficit.
‘DOGE Dividend’ Inflation?
When Fishback first floated his “DOGE Dividend” checks idea, Heritage Foundation tax policy research fellow Preston Brashers suggested they would cause inflation to “come back with a vengeance.”During Thursday’s press briefing, a reporter asked National Economic Council Director Kevin Hassett if he has any concerns about the DOGE checks being inflationary.
“Oh, absolutely not,” Hassett replied, saying that if Americans spend all of the money, “then you’re even” regarding inflationary impacts, but if they save the money, that would reduce inflation.
“If we reduce government spending, then that reduces inflation. And if you give people money, then they’re going to save much of it, and when they save it, then that also reduces demand. It reduces inflation.”
While a combined 77 percent and 81 percent of Americans either “mostly saved” or “mostly paid off debt” with the second and third rounds of COVID stimulus checks, respectively, 74 percent of Americans said they “mostly spent” all of their first stimulus checks that were distributed through the CARES Act in March 2020.
However, the survey noted that the first checks were sent out when the unemployment rate had peaked, meaning many households were struggling to pay basic expenses, which could have affected their decision to spend rather than save the money.
