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Tag: Scott Bessent
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Trump threatens Canada with 50% tariff on aircraft sold in U.S., expanding trade war
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President Trump on Thursday threatened Canada with a 50% tariff on any aircraft sold in the U.S., the latest salvo in his trade war with America’s northern neighbor as his feud with Prime Minister Mark Carney expands.
The president said he was retaliating against Canada for refusing to certify jets from Savannah, Georgia-based Gulfstream Aerospace. In response, Mr. Trump said on Truth Social late Thursday the U.S. would decertify all Canadian aircraft, including planes from its largest aircraft maker, Quebec-based Bombardier.
“If, for any reason, this situation is not immediately corrected, I am going to charge Canada a 50% Tariff on any and all Aircraft sold into the United States of America,” Mr. Trump said in his post.
Mr. Trump said he is “hereby decertifying” the Bombardier Global Express business jets and “all Aircraft made in Canada.” There are 150 Global Express aircraft in service registered in the U.S., operated by 115 operators, according to Cirium, the aviation analytics company. Several U.S. airlines also operate Bombardier CRJ regional jets.
In total, more than 400 Canadian-made aircraft were flying to or from U.S. airports as of about 8 p.m. on Thursday, according to plane-tracking company Flightradar24.
In a statement provided to CBS News Thursday night, Bombardier said it had “taken note” of Mr. Trump’s social media post and was “in contact with the Canadian government.”
“Thousands of private and civilian jets built in Canada fly in the U.S. every day,” Bombardier said. “We hope this is quickly resolved to avoid a significant impact to air traffic and the flying public.”
The company said it employs about 3,000 people in the U.S. at nine different facilities, and is “actively investing in expanding” it’s U.S. operations.
Spokespeople for Canada’s transport minister didn’t immediately respond to messages from The Associated Press seeking comment Thursday evening.
The U.S. Commerce Department previously put duties on Bombardier’s CSeries commercial passenger jet in 2017 during the first Trump administration, charging that the Canadian company was selling the planes in America below cost. The U.S. said then that the Montreal-based Bombardier used unfair government subsidies to sell jets at artificially low prices. The allegations were initially raised by Boeing, whose arch-rival Airbus later took a majority stake in the CSeries program.
The U.S. International Trade Commission in Washington later ruled that Bombardier did not injure U.S. industry.
Bombardier has since concentrated on the business and private jet market. If Mr. Trump cuts off the U.S. market, it would be a major blow to the Quebec company.
Mr. Trump’s threat over planes came after the U.S. president said over the weekend he would impose a 100% tariff on goods imported from Canada if it went forward with a planned trade deal with China. The U.S. and Canada have faced off over trade and tariffs since Mr. Trump’s return to the White House last year.
And at the World Economic Forum in Davos last week, Carney condemned economic coercion by great powers on smaller countries without mentioning Mr. Trump’s name. The U.S. leader hit back a day later, accusing Carney of showing ingratitude toward the U.S. despite getting “a lot of freebies from us.”
Treasury Secretary Scott Bessent warned Carney on Wednesday that his recent public comments against U.S. trade policy could backfire going into the formal review of the U.S.-Mexico-Canada Agreement, the trade deal that protects Canada from the heaviest impacts of Trump’s tariffs.
Carney rejected Bessent’s contention that he had aggressively walked back his comments at the World Economic Forum during a phone call with Mr. Trump on Monday. Carney said he told Mr. Trump that he meant what he said in his speech at Davos, and told him Canada plans to diversify away from the United States with a dozen new trade deals.
Besides Bombardier, other major aircraft manufacturers in Canada include De Havilland Aircraft of Canada, which makes turboprop planes and aircraft designed for maritime patrols and reconnaissance, and European aerospace giant Airbus. Airbus manufactures its single-aisle A220 commercial planes and helicopters in Canada.
During the Biden administration, the U.S. International Trade Administration touted the interdependence of the U.S. and Canadian aerospace industries and cited a 1980 World Trade Organization agreement that the website of the current U.S. trade representative says “requires signatories to eliminate tariffs on civil aircraft, engines, flight simulators, and related parts and components.”
Canada’s Trade Commissioner Service describes the United States as the largest trading partner for the country’s aerospace and space industries and the destination for a significant portion of exported aircraft, components and space technologies.
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Read the full transcript of Kelly O’Grady’s interview with Treasury Secretary Scott Bessent here
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U.S. Treasury Secretary Scott Bessent addressed his department’s ongoing investigation into Federal Reserve Chair Jerome Powell and the administration’s new $1,000 “Trump Accounts” for children born during President Trump’s second term in an interview Wednesday with “CBS Saturday Morning” co-host Kelly O’Grady. Read the full transcript of their conversation below.
KELLY O’GRADY: Thank you so much, Secretary, for sitting down with us. I want to start on the Trump accounts. Okay? So let’s start broad and quick. What, for families viewing, is your one-sentence pitch on the Trump accounts?
SECRETARY SCOTT BESSENT: Well, for the families who have children between January 1st, 2025, and December 31, 2028, you got $1,000 coming from the government that’s going to be invested into an index fund. But for all families with children below age 18, sign up, Trumpaccounts.gov, they’re going to go live July 5th. So even if your child doesn’t get the thousand dollars from the government, you can contribute in tax free. And we’re going to have employers who are contributing, friends, family can contribute. We got some of America’s great philanthropists like Michael and Susan Dell, $6.25 billion, you got Ray Dalio, who adopted children, or sponsoring children in the state of Connecticut, Brad Gerstner, who, this really came from an idea at his dining room table, just announced he’s going to donate to all children below age five. So we think there are 25 million households who are there to sign up, we’ve gotten 600,000 signups just this week, so sign up, and the – start the program.
O’GRADY: All right. That might have been more than one sentence, but I’ll let it slide because it was good. It was a good explanation, I like it. I want to press you, though on this, this question of the wealth gap, because we’ve heard from critics that, well, let’s say I’m a high-income-earning family, I can keep contributing to that over time as my child grows. But if I’m a low-income family, my child, when they turn 18, may only have $5,000 or so, give or take. So, how are you going to prevent the wealth gap from widening with this program?
BESSENT: Well, actually, I think that that is a terrible criticism, and it shows how out of touch anyone who says that is, because if they say only $5,000, these are families, huge number of families in America, wouldn’t have $500 to meet a medical emergency. So how can they say only $5,000? What the hell are they talking about? Doesn’t make any sense. You know, it’s just because President Trump has sponsored it. They don’t agree with it. The other thing, too, is a lot of the contributions, Michael and Susan Dell’s contribution, $6.25 billion across America, is not going to the top 20% economic zip codes. So philanthropists can actually choose. They can choose by zip codes. They can choose by school district. They can do it by economic quintiles. States can get in on the action. So and again, you don’t want a wealth gap.
O’GRADY: No.
BESSENT: You don’t want a wealth gap. Go to Venezuela. Go to Cuba. Nobody has anything.
O’GRADY: Okay. So, you know, I cover business, right? So let’s, let’s talk a little bit though about those, those lower income families that maybe don’t have the financial literacy, because I’m going to be honest, it took me a long time to get where I was. What are some of the safeguards in this program that will help educate folks so that when someone does turn 18, you know they are able to utilize this in the right way and benefit?
BESSENT: Sure. Great. Great question. I’ve been a big proponent of financial literacy over the years. We are pressing the states. We think, you know, states should be in charge of education. But I believe that by virtue of the accounts existing, we’re going to have a great real-time laboratory. The people are going to want to get up to speed, because you’re going to be able to look at it on your phone. You can sign up on your phone, you can watch the account on your phone. So all of a sudden it’s not some abstract intangible that like, this is what goes on at the corner of Wall Street and Broad Street.
O’GRADY: [LAUGHS] Bears. Bulls. Yeah.
BESSENT: Yes. And so, but we’re going to push a big amount of financial literacy out of Treasury. We’re going to continually encourage people to update and I think families are going to be very interested. I – we studies have shown that the main impediment is getting the account open, that people who don’t save, they don’t have a vehicle to save is what – my deep, dark secret is I have a Dr. Pepper for breakfast. Not allowed to do it in the house with the children.
O’GRADY: Wait, that’s your, that’s your breakfast, Secretary? [LAUGHS]
BESSENT: Yeah. [LAUGHS]
O’GRADY: Breaking news. [LAUGHS]
BESSENT: Don’t tell Bobby Kennedy.
O’GRADY: All right, all right, all right, well –
BESSENT: Don’t tell Bobby Kennedy. But, I, but I, end up at the Circle K on Meeting Street in Charleston, South Carolina. A lot of young workers there. I’m dressed like this. They come up to me, they’re all playing the lottery. And, they say, Mister, if I win the lottery, will you manage my money? And I said, the best thing you can do is not play the lottery. But I couldn’t tell them what else to do with it. Now, you could say, put it in your child’s account and it’ll, it’ll grow over the years.
O’GRADY: So I do want to pick up on on that, right. And we’ll get back to the Trump accounts in a minute. But that’s a future thing, right, to your point. There are people in this country like the ones that you just spoke about that are feeling crunched now. And I’ve heard your administration and you say we have a great economy, but you do have folks that aren’t feeling it. The president has said, just give us time. Give us time. Can you tell the American people how long they have to wait?
BESSENT: Oh, I, I think, it’s starting to kick in right now. And they should feel crunched. The Biden administration blew out working Americans. Stated inflation was 22-23%, but a friend of mine, Jason Trennert, Strategas Partners, says, something called the Common Man Index. And that’s what working families have. So it’s groceries, insurance, cars, special used cars, rent. And that was up in the 30s. So yes, but they are crunched. So what we’re trying to do, we’re trying to control costs. I think inflation is going to be back toward the Fed target 2%. Rents are down. Energy’s down.
President’s pushing down prescription drug costs. The other side of that is going to be the real wage growth. We’ve had real wage growth every month that the President’s been in office, as part of the one big beautiful bill, the President’s signature policies, no tax on tips, no tax on overtime, no tax on Social Security, deductibility of American-made auto loans, or the interest on those, that began, it was retroactive for 2025. I’m also the IRS commissioner, we did not give withholding guidance. So we’re going to have substantial tax refunds this year.
O’GRADY: I–I actually do want to pick up on that though, because the tax refunds, that is, for folks who are struggling, everyone looks forward to April, not doin– not doing the taxes certainly in my house but the tax refund. The thing though that I’m concerned about and I want your thoughts, if we were to have a shutdown, if Democrats do decide to withhold their votes over ICE funding, how is the IRS going to deal with that during tax season?
BESSENT: Well, I think, A, I can’t imagine that the Democrats would be as irresponsible to close us down. And as you said, the Democrats’ shut down. They – they would be irresponsible to close down for the length that they did last time. But I can tell you we’re ready. We have continuous plans in place. It will not affect tax season at all. As a matter of fact, I could say that the cold weather we’ve seen the past two days is more of a hindrance than the shutdown would be at the IRS. So we are fulsome, robust and prepared.
O’GRADY: All right. I do like to hear that, I like my tax refund. You mentioned, you know, inflation, the 2% target. I immediately go, up, the Fed’s target and I would be remiss if I didn’t ask you about the Fed because we do have an interest rate decision this week.
BESSENT: Today.
O’GRADY: Today. That is right. In a few hours here, the Department of Justice is investigating Fed Chair Powell, what message should that send to future Fed chairs as the president is about to announce who will succeed Powell?
BESSENT: I think that the message is that independence does not mean no accountability. I’ve been calling for the Fed to do an internal investigation on numerous things since last spring, and they’ve chosen not to do it. The Fed has a very special relationship with the American people because it is the most powerful unappointed group in the U.S., and because of that, they have to be like Caesar’s wife, they have to be beyond reproach. So, if I, if I want a new chair for my office at Treasury, it comes from an appropriation. The Fed, if they overspend on a building, $700 million, a billion, a billion and a half, they just print magic money. So they can print their own money, so you have a responsibility. But again, President has great reverence for the Fed’s independence. But independence does not mean no accountability.
O’GRADY: Is there – would it be crazy for someone to worry that there would be more accountability, more oversight if interest rates don’t go the way that the president, this president, or, by the way, any future president, wants?
BESSENT: Not at all. Because, again, the president’s well aware that it’s a committee, and the committee has 12, 12 voters, the chair’s just one vote.
O’GRADY: Fair point. I did want to ask you, you know, something that we’ve heard from our viewers is that there isn’t enough focus on what’s going on here in the U.S, that there’s a focus on, on other countries. And I want to pick up on Venezuela. It’s one that’s been in the news. The oil sales. We’ve recently had an oil sale. Can you confirm where that money has gone from that recent Venezuelan oil sale?
BESSENT: Well, it’s going back to the Venezuelan people.
O’GRADY: Okay.
BESSENT: But again, this is very important for the American people because the, the Venezuelan oil is very heavy crude, but very, very necessary for refineries in the southern part of the U.S. So our gasoline prices are driven by that. So the more supply that comes in to those refineries, lower gasoline prices are going to come here.
O’GRADY: And that’s fair. I always, on that – when I’m looking at the CPI index, I always look at what energy is doing –
BESSENT: Yup.
O’GRADY: – because that is a big driver of where things go. Just a couple more questions for you.
BESSENT: Of course.
O’GRADY: I did want to ask, go back to the Trump accounts for a second. You know, let’s say, 2043. Someone has a baby right now. They sign up for an account. 18 years from now, if that person, when they, they receive that money in that account, if they aren’t able to go out and pay for college, to go buy a home eventually, if it hasn’t really meaningfully changed their ability to do that, would you call this a failure? Or is there a different way that the Treasury measures success in this particular program?
BESSENT: Well, first of all, again, as I said, so many Americans couldn’t even meet a $500 emergency. So maybe people just put it away and it’s a rainy day fund. You know, it can be a component. I worked three jobs to put myself through college, so maybe I would just be working two if that happened. And, but again, I think the success of this is going to be, as you just said, on foreign policy, maybe a lot of Americans, like with Venezuela, don’t understand how it affects them. For many Americans, Wall Street is just – 38% of the households who don’t have stocks, Wall Street is this abstract notion. All of a sudden they have participated for 18 years, that, in the financial markets. So as it – it’s a constant financial education.
O’GRADY: Hm. Yeah I mean – that’s, that’s sort of the reason why I have a job. So I hear you on that. Last question for you, I always like to end on a little bit of a light note when we can. Okay. I have heard you describe yourself as a ninja when it comes to business. So can you level with me? Elon Musk black eye, right hook or left?
BESSENT: Whoever did it is left-handed.
O’GRADY: Ah! Are you left-handed, Secretary?
BESSENT: That’s for the next interview.
O’GRADY: [laughs]
BESSENT: But I, I, I think his son X may be. And he said, X, they, uh, did it, so –
O’GRADY: He may have a UFC fighter on his hands, then.
BESSENT: I think he’d just taken X to UFC –
O’GRADY: Yeah.
BESSENT: – a couple of weeks before.
O’GRADY: All right, Secretary, so appreciate your time today. Thank you.
BESSENT: Good to see you.
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Bessent touts Trump Accounts as rainy day fund and slams critics as
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U.S. Treasury Secretary Scott Bessent on Wednesday touted the benefits of the Trump administration’s new savings program for U.S. children, telling “CBS Saturday Morning” co-host Kelly O’Grady that the “Trump Accounts” could serve as “a rainy day fund” when those kids reach adulthood.
The program, created under the Republicans’ “big, beautiful bill” tax and spending law, calls for the federal government to start tax-preferred investment accounts for about 25 million children born between Jan. 1, 2025, and Dec. 31, 2028. The U.S. will seed each account with $1,000, which will be invested in the stock market.
“You got $1,000 coming from the government that’s going to be invested into an index fund,” Bessent said, adding that “even if your child doesn’t get $1,000 from the government, you can contribute …in tax free. And we’re going to have employers who are contributing.”
Philanthropists Michael and Susan Dell have pledged to contribute $250 per child to many of the new accounts, while companies including Bank of America and JPMorgan Chase announced Wednesday that they’ll also chip in $1,000 to accounts opened by the financial giants’ employees.
“So many Americans couldn’t even [handle a] $500 emergency,” Bessent told O’Grady. “So maybe people just put it away and it’s a rainy day fund. You know, it can be a component” of a bigger purchase or investment.
The accounts will remain invested for children until they turn 18, when they can tap the money to pay for qualified expenses, such as education, buying a home or starting a business.
Bessent said the accounts, which are limited to contributions of $5,000 per year per child, have drawn 600,000 signups this week alone. Families with children under 18 may also open accounts, although they won’t get the seed money from the federal government.
Closing the wealth gap?
Trump Accounts have raised some concerns that they could widen the U.S. wealth gap — which recently hit an all-time high — because higher-income families could stash the maximum of $5,000 per year in a child’s account, while lower-income households might struggle to contribute funds.
Bessent rejects such criticism, noting that the Dells’ $6.2 billion contribution won’t include the wealthiest 20% of U.S. zip codes.
“It shows how out of touch anyone who says that is, because if they say only $5,000, these are families — a huge number of families in America — wouldn’t have $500 [for] a medical emergency. So how can they say only $5,000? What the hell are they talking about? It doesn’t make any sense. It’s just because President Trump has sponsored it, they don’t agree with it.”
Bessent added that philanthropists who want to donate funds for a Trump Account can direct the money to lower-income parts of the U.S. “They can choose by zip codes. They can choose by school district. They can do it by economic quintiles,” he said.
The accounts are likely to also help educate Americans about investing, especially the 38% of households that don’t own stocks, Bessent added, noting the importance of financial literacy.
“For many Americans … Wall Street is this abstract notion,” Bessent told O’Grady. “All of a sudden they have participated for 18 years in the financial markets. So it’s a constant financial education.”
Addressing affordability
Asked about affordability issues that many Americans say they are facing, Bessent blamed the Biden administration for driving up inflation. He also credits President Trump for boosting wage growth, pushing down prescription drug costs and introducing tax cuts through the “big beautiful” bill.
“What we’re trying to do, we’re trying to control costs,” Bessent said. “I think inflation is going to be back toward the Fed target of 2%.”
Many Americans have negative views about the cost of living in the U.S., according to a December CBS News poll.
The Trump administration has introduced a flurry of proposals in recent weeks, in addition to the Trump Accounts, aimed at easing affordability pressures. They include promises to cap credit card interest rates at 10% and ban institutional investors from buying single-family homes.
Experts, however, have questioned whether these proposals will achieve their intended objectives.
Demanding Fed “accountability”
Bessent also touched on the independence of the Federal Reserve and defended the Department of Justice’s ongoing investigation into Federal Reserve Chair Jerome Powell, dismissing concerns that the probe could weaken the central bank’s traditional independence.
“I think that the message is that independence does not mean no accountability,” Bessent said. “I’ve been calling for the Fed to do an internal investigation on numerous things since last spring, and they’ve chosen not to do it.”
Earlier this month, the Justice Department served the central bank with grand jury subpoenas tied to a criminal investigation into Powell’s June 2025 testimony before a Senate committee regarding a project to renovate several Fed buildings in Washington, D.C.
Powell responded in a video message, calling the investigation a pretext for weakening the Fed’s independence in setting interest rates. Mr. Trump has already identified several candidates to replace the central bank chief when his term expires in May.
Bessent said Wednesday that the Fed must be “beyond reproach” in its dealings, characterizing it as the “most powerful, unappointed group in the U.S.”
Addressing the DOJ investigation, Bessent said the central bank should be held accountable for its actions.
“[The] president has great reverence for the Fed’s independence,” he said. “But independence does not mean no accountability.”
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Dow drops 870 points after Trump threatens European allies with tariffs over Greenland
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The U.S. stock market plunged on Tuesday after President Trump threatened to impose fresh tariffs on European trading partners over the weekend, one of the latest developments in his bid to acquire the island of Greenland.
The Dow Jones Industrial Average dropped 870 points, or 1.8%, to close at 48,489, while the S&P 500 fell 143 points, or 2.1%, to close at 6,797.
Major tech stocks took a hit, with the Nasdaq Composite sinking 2.4%. Nvidia and Amazon shares dropped 3.6% and 3.7%, respectively.
The rocky day on Wall Street came after President Trump said on Saturday on Truth Social that he would impose a 10% tariff on goods from Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland beginning in February. Trump said the tariffs would rise to 25% on June 1 and apply to imports from NATO countries until a deal is reached for the purchase of Greenland.
European markets and markets in Asia also fell on Tuesday.
The European Union accounts for a large share of U.S. imports, with annual shipments from its member nations exceeding those from Mexico and China combined.
Mr. Trump linked his aggressive stance on Greenland to last year’s decision not to award him the Nobel Peace Prize, telling Norway’s prime minister that he no longer felt “an obligation to think purely of Peace,” in a text message released Monday.
Mr. Trump’s message to Jonas Gahr Støre appeared to ratchet up a standoff between Washington and its closest allies over his threats to take over Greenland, a self-governing territory of NATO member Denmark.
Mr. Trump’s threats have sparked outrage and a flurry of diplomatic activity across Europe, as leaders consider possible countermeasures, including retaliatory tariffs and the first-ever use of the European Union’s anti-coercion instrument.
Davos meeting
U.S. Treasury Secretary Scott Bessent, speaking on the sidelines of the World Economic Forum annual meeting in Davos, Switzerland, asserted that America’s relations with Europe remain strong. He urged trading partners to “take a deep breath” and let tensions driven by the tariff threats over Greenland “play out.”
“Geopolitical events will remain in focus today, particularly any talks that may take place in Davos,” said Michael Brown, a senior research strategist at Pepperstone, referring to the World Economic Forum.
Wedbush Securities analyst Dan Ives said the new tariff threat “is clearly an overhang on the conference,” but that it would likely simmer over time.
“Our view is just like over the last year the bark will be worse than the bite on this issue and tariff threats as negotiations take place and tensions ultimately calm down between Trump and EU leaders,” Ives wrote in a note to clients.
This week will bring more U.S. corporate earnings and the latest inflation measurement that’s preferred by the Federal Reserve for making policy decisions.
The U.S. Federal Reserve’s next policy meeting is in two weeks. Interest rate traders currently place a 95% likelihood that the benchmark interest rate unchanged, according to CME Group’s FedWatch tool. The Bank of Japan has a monetary policy board meeting ending later this week.
Silver and gold both rose to records again as investors sought safety amid heightened geopolitical tensions. Gold prices surged 3.7% and silver prices soared 6.9%.
The price of U.S. crude oil rose 1.5% to $60.34 per barrel. The price of Brent crude, the international standard, rose 1.3% to $64.76.
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U.S. Treasury Secretary pushes for Minnesota fraud crackdown as tensions over ICE efforts flare
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U.S. Treasury Secretary Scott Bessent announced the creation of a new IRS task force and other measures to combat fraud, underscoring the Trump administration’s focus on Minnesota amidst the immigration crackdown.
“Minnesota is going to be the protocols, procedures and investigative techniques and collaboration. Minnesota is going to be the genesis for a national rollout,” Bessent said. “Treasury will deploy all tools to bring an end to this egregious, unchecked fraud and hold perpetrators to account.”
According to Bessent, the IRS task force will specifically probe financial institutions that facilitate wire transfers, as evidence from the Feeding Our Future trial showed some suspects sent money to banks in Kenya and China. Bessent added that four Twin Cities-based businesses are under investigation, but did not share their names. The department is also requiring all financial institutions in Hennepin and Ramsey counties to report any overseas transfer of $3,000 or more.
“Think of the absurdity of money being wired from Minnesota by these individuals that could have come from government programs or from excess benefits,” Bessent added. “This should not be wired out of the country and we are going to be cracking down on that.”
Bessent’s visit also comes on the heels of Attorney General Pam Bondi’s announcement that a team of prosecutors is headed to Minnesota “to reinforce our U.S. Attorney’s Office and put perpetrators of this widespread fraud behind bars.”
“We will deliver severe consequences in Minnesota and stand ready to deploy to any other state where similar fraud schemes are robbing American taxpayers,” Bondi said.
Reached for comment, Minnesota Attorney General Keith Ellison’s office said it “categorically rejects the premise that the ‘underlying reason’ Trump has ordered the outsized presence of ICE in Minnesota is because of fraud,” and said “Ellison does have extensive experience in successfully fighting fraud.”
“What Donald Trump knows about fraud isn’t fighting it, it’s actually letting fraudsters out of prison,” Ellison’s office added.
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Bessent unveils new Trump Accounts website as part of push to encourage saving for children
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Treasury Secretary Scott Bessent on Wednesday unveiled the new website for the Trump Accounts program, a tax-deferred investment vehicle for American children. He also announced a new Trump Accounts partner, billionaire hedge fund manager Ray Dalio.
At a briefing on the program, Bessent projected that the $1,000 deposited into a Trump Account by the government when a child is born would grow to over $600,000 by retirement age, assuming that the historic growth rate continues. For families who invest $5,000 each year in the accounts, that sum would grow to $1 million, he added.
Parents may sign up their children by making an election on a new IRS form — Form 4547 — when they file their taxes. A financial institution will receive the child’s funds and activate the account. Trump accounts are to be invested in an authorized investment, like mutual funds or exchange-traded funds that track the S&P 500 stock index or another index with mostly U.S. equities. Financial firms managing the funds also may not charge more than 0.1% in annual fees.
Children who are U.S. citizens born between Jan. 1, 2025, and Dec. 31, 2028 are eligible to receive the $1,000 government contribution into their accounts. Children under 18 who have a Social Security number can receive up to $5,000 each year from parents, guardians or others in their account.
Dalio, the founder of Bridgewater Associates, the world’s largest hedge fund, is contributing $75 million as part of a 50-state push for businesses and philanthropic organizations to donate in each state. Dalio will “boost funding for Trump accounts for kids across Connecticut,” Bessent said.
“Ray and Barbara Dalio through Dalio Philanthropies announced today that they are joining the Dell family in seeding the new Trump Administration investment accounts with an additional $250 per child for approximately 300,000 children in Connecticut,” the Dalios said in a statement on their foundation’s website.
The accounts were created under President Trump’s “big, beautiful bill” tax and spending bill earlier this year. Households of any income may open an account, and all such accounts qualify for the one-time $1,000 government contribution.
Billionaires Michael and Susan Dell donated a historic $6.25 billion earlier this month, pledging to deposit $250 into the accounts of 25 million children ages 10 and younger as an incentive to save for the future.
Families will be able to start making financial contributions on July 4, 2026. They won’t be able to withdraw funds from the Trump account before a child turns 18, except under certain conditions.
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Bessent calls for overhaul of regulator tasked with spotting systemic financial risks
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Treasury Secretary Scott Bessent wants to overhaul a federal regulatory group, launched following the 2008 housing bust, that is tasked with safeguarding the U.S. financial system.
The 15-member panel, known as the Financial Stability Oversight Council (FSOC), was established by the 2010 Dodd-Frank Act to help spot and defuse systemic financial risks.
The council is chaired by the Secretary of the Treasury and includes the leaders from other financial regulatory agencies, such as the director of the Consumer Financial Protection Bureau and the head of the Board of Governors of the Federal Reserve System.
In a letter released Thursday, Bessent called for looser FSOC regulations, saying that “too often in the past, efforts to safeguard the financial system have resulted in burdensome and often duplicative regulations.”
“Our administration is changing that approach,” Bessent added.
The Treasury Department and the White House did not respond to requests for comment.
Proponents of strong financial regulation criticized the push to revamp the FSOC.
“What you’re removing is the smoke alarm for the entire financial system,” said Oscar Valdés Viera, private equity and capital markets policy analyst at Americans for Financial Reform, a coalition consisting of over 250 national and local groups.
Bessent’s proposal would remove vital safeguards just as financial risks are mounting, such as a potential bubble in AI stocks, Valdés Viera added.
Sen. Elizabeth Warren, a Democrat from Massachusetts, also attacked the decision to loosen financial regulations.
“Going down this path just as cracks are emerging in the financial system and yellow lights are flashing across our economy is especially reckless,” she said in a statement, citing the recent bankruptcies of subprime auto lender Tricolor Holdings, auto parts company First Brands and home remodeling platform Renovo Home Partners.
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U.S. sanctions 3 of Maduro’s nephews, 6 oil tankers as Venezuela pressure campaign builds
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The U.S. imposed sanctions on three nephews of Venezuelan President Nicolás Maduro on Thursday, as well as half a dozen ships accused of carrying oil from the country, as President Trump looks to inflict further pressure on the South American nation.
The new sanctions target Franqui Flores, Carlos Flores and Efrain Campo. Also included in the sanctions are Panamanian businessman Ramon Carretero Napolitano, six firms and six Venezuela-flagged ships suspected of transporting Venezuelan oil.
U.S. authorities seized control of a sanctioned oil tanker near Venezuela on Wednesday, an escalation of the recent pressure campaign that has seen thousands of U.S. troops deployed to the region.
The Treasury’s Office of Foreign Assets Control published the list of newly sanctioned individuals and entities on Thursday.
The sanctions are meant to deny them access to any property or financial assets held in the U.S., and the penalties are intended to prevent U.S. companies and citizens from doing business with them. Banks and financial institutions that violate that restriction expose themselves to sanctions or enforcement actions.
Treasury Secretary Scott Bessent said in a statement that “Nicolas Maduro and his criminal associates in Venezuela are flooding the United States with drugs that are poisoning the American people.”
“Under President Trump’s leadership, Treasury is holding the regime and its circle of cronies and companies accountable for its continued crimes,” he said.
This is not the first time Maduro’s family has been involved in a political tit-for-tat with the U.S.
In October 2022, Venezuela freed seven imprisoned Americans in exchange for the United States releasing Flores and Campo, who had been jailed for years on narcotics convictions. The pair were arrested in Haiti in a Drug Enforcement Administration sting in 2015 and convicted the following year in New York.
Carlos Flores had been sanctioned in July 2017 but was removed from Treasury’s list in 2022 during the Biden administration years in an effort to promote negotiations for democratic elections in Venezuela.
The U.S.’s latest actions against Venezuela follow a series of deadly strikes the U.S. has conducted on alleged drug-smuggling boats in the Caribbean Sea and eastern Pacific Ocean, which have killed at least 87 people since early September.
Mr. Trump has justified the attacks as a necessary escalation to stem the flow of drugs into the United States and asserted the U.S. is engaged in an “armed conflict” with drug cartels.
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US Treasury secretary takes aim at Fed’s interest rate control system
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By Michael S. Derby
(Reuters) -U.S. Treasury Secretary Scott Bessent said on Tuesday the Federal Reserve’s system of managing interest rates is struggling and needs to be simplified.
“We’ve gotten to this point where monetary policy has gotten very complicated” and the U.S. central bank should “simplify things,” Bessent said in an interview with CNBC.
“The Fed has taken us into a new regime, and what is called ample-reserves regime. And it looks like that might be fraying a bit here in terms of whether the reserves are actually ample,” Bessent said.
The Treasury secretary did not say what he meant by fraying.
The Fed has faced and continues to face challenging money market conditions tied to how it has been managing its $6.56 trillion balance sheet and financial system liquidity levels.
Officials at the Fed’s last policy meeting announced that they would stop the contraction of the central bank’s overall balance sheet at the start of December. They did so as liquidity in financial markets in the run-up to the late October policy meeting tightened enough to complicate control of the federal funds rate, the Fed’s primary tool to achieve its inflation and employment goals.
The turbulence was such that it drove eligible financial firms to borrow notable levels of cash from the Fed via its Standing Repo Facility, a tool used to put a ceiling over short-term interest rates. There were also intermittent large inflows of cash into the Fed’s reverse repo tool, which is used to set a floor underneath money market rates.
CRITIC OF FED BALANCE SHEET
Bessent has been a persistent Fed critic who has expressed particular concern about its large balance sheet, which is primarily stocked with trillions in bonds bought in large part to stabilize financial markets and to provide stimulus to the economy.
The large footprint, at least in dollar terms, is seen by Bessent and others, including some at the Fed, as distorting market pricing levels. There also has been concern about the complex way the Fed manages rates, which relies on liquidity facilities and eschews the highly managed system it used prior to the financial crisis that began nearly 20 years ago.
“A large balance sheet increases the Fed’s footprint in financial markets, distorts the price of duration and the slope of the yield curve, and potentially blurs the line between monetary and fiscal policy,” Kansas City Fed President Jeffrey Schmid said in a speech on November 14.
Others have lamented that managing liquidity under the current system has led the Fed to pay out substantial sums to financial institutions. That approach turned the Fed from an institution that made substantial profits to one that is currently $240 billion in the red, even as those losses have no impact on its ability to operate.
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Treasury Secretary Hopes You Don’t Cash Trump’s $2,000 Checks
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Scott Bessent knows an inflationary idea when he hears one.
Photo: Win McNamee/Getty ImagesDuring both his presidential terms, Donald Trump has longed to make Americans happy by mailing them checks from the government adorned with his own signature in case anyone wants to write him a thank-you note in the form of a vote. So it’s not surprising that his big idea for responding to the rise of “affordability” as a national political issue is to send out $2,000 checks, allegedly to be financed by his trade-war tariffs. Do people think tariffs boost consumer prices? Okay, then, here’s a rebate! Or a “tariff dividend,” as he calls it.
Now, that is very unlikely to come to pass for a variety of reasons. For one thing, Trump is vastly overestimating the tariff revenue that’s coming in. For another, his own administration and perhaps soon the Supreme Court are putting the brakes on his tariff offensive. And even more obviously, authorizing $2,000 checks from Trump for everybody at this particular moment has zero support among Democrats and not much support among Republicans, who mostly seem to be rolling their eyes over it. If they take it seriously at all, they tend to recommend that any “tariff dividends,” should they actually emerge, be used to reduce the public debt that Trump has never seemed to worry about for a moment.
But the most telling (not to mention hilarious) reaction to the “tariff dividend” idea has come from Trump’s own Treasury secretary, Scott Bessent, as Axios reported:
The administration is hopeful Americans won’t necessarily spend the $2,000 tariff checks President Trump has promised, and instead pump them into “Trump accounts” for kids, Treasury Secretary Scott Bessent says …
The risk of rising prices remains a huge concern for consumers, and against that backdrop, Fox News asked Bessent Tuesday night how the government would avoid another bout of stimulus-driven inflation if the checks happen.
“Maybe we could persuade Americans to save that, because one of the things that’s going to happen next year” is the start of “Trump accounts” to save for kids, Bessent said.
So the president wants to send checks to folks who are worried about making ends meet today, tomorrow, and the day after tomorrow. But his top economic adviser is telling them not to cash those checks to pay for their living costs but to save them instead because (quite accurately) spending the money might boost living costs even more.
Bessent was clever enough to couch this blatant contradiction of the president’s wishes in a recommendation that the money should go into Trump-branded savings vehicles (the subsidized kiddie savings accounts created by the One Big Beautiful Act). But it’s probably not what the president had in mind when he imagined grateful Americans using those checks to pay for groceries and gasoline while uttering a prayer of thanksgiving for their benefactor the president — and vowing to vote Republican in the 2026 midterms.
Vote-buying is a simple proposition, but the people around Trump keep trying to complicate it. No wonder he’s angry and frustrated about “affordability.”
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Ed Kilgore
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Trump lowers tariffs on coffee, beef and fruits, as Americans’ concerns about affordability grow
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(CNN) — President Donald Trump on Friday signed an executive order that retroactively lowers tariffs on beef, tomatoes, coffee and bananas, among other agricultural imports, backdated to Thursday.
The order Trump signed excludes the goods from “reciprocal” tariff rates, which start at 10% and go as high as 50%. However, the order doesn’t exempt the goods entirely from tariffs.
For instance, tomatoes from Mexico, a major supplier to the United States, will continue to be tariffed at 17%. That rate took effect in July after a nearly three-decade-old trade agreement expired. Tomato prices increased almost immediately after those tariffs were put in place.
Many of the commodities that will no longer face “reciprocal” tariffs have seen some of the biggest price increases since Trump took office, in part because of tariffs he imposed and a lack of sufficient domestic supply.
For instance, Brazil, the top supplier of coffee to the US, has faced tariffs of 50% since August. Consumers paid nearly 20% more for coffee in September compared to the prior year, according to Consumer Price Index data.
The move comes after voters expressed frustrations with the state of the economy in exit polls earlier this month, voting for Democrats in off-year elections in several states.
In previewing Friday’s executive order, Treasury Secretary Scott Bessent said earlier this week the moves targeted goods “we don’t grow here in the United States,” referring to coffee and bananas. (While coffee is grown in some parts of the country, it’s mostly imported.)
Earlier on Friday the Trump administration and the Swiss government announced a new trade framework that calls for lowering tariffs on goods from Switzerland to 15% from 39%, a rate that was among the highest across all countries the US trades with.
This story has been updated with additional context and developments.
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Elisabeth Buchwald and CNN
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Donald Trump stimulus check update: White House “committed” on $2K payments
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President Donald Trump is “committed” to sending Americans $2,000 dividend checks, White House press secretary Karoline Leavitt said.
Speaking to reporters at the White House on Wednesday, Leavitt said officials are exploring ways to implement a plan to distribute money from tariff revenue. She did not provide further details about the plan.
A White House official told Newsweek: “President Trump’s tariffs are resetting global commerce, securing manufacturing investments, and safeguarding our national and economic security – and they’re also raising billions in revenue for the federal government. The Administration is committed to putting this money to good use for the American people. Given we have not yet revealed any specifics here, back-of-the-envelope analyses about the dividends are baseless speculation.”
Why It Matters
Trump has faced a backlash over his handling of the economy since his return to the White House, and inflation and economic uncertainty are rife. Stimulus checks could prove particularly popular among lower-income voters, but some policy experts have raised concerns about the feasibility of the proposal.
What To Know
Leavitt told reporters: “The president made it clear he wants to make it happen. So his team of economic advisers are looking into it.”
It comes after Trump posted on Truth Social about the plan, saying: “We’re going to issue a dividend to our middle-income people and lower-income people—about $2,000.”
He also spoke about it at the Oval Office on Monday and said it would apply to “middle-income people and lower-income people,” though he did not specify what that income threshold would be.
On Sunday, Treasury Secretary Scott Bessent appeared to express doubts about the plan when he told ABC News’ This Week that a tariff dividend could come “in lots of forms” and that Trump could have been referring to tax savings from his One Big Beautiful Bill legislation.
“It could be just the tax decreases that we are seeing on the president’s agenda. No tax on tips, no tax on overtime, no tax on Social Security, deductibility on auto loans. Those are substantial deductions that are being financed in the tax bill,” Bessent said.
An analysis by the Committee for a Responsible Federal Budget (CRFB) estimated the cost of such rebate checks at $600 billion annually, which is double the total annual revenue projected from new tariffs in 2025. The CRFB warned that this could add $6 trillion to the national deficit over a decade if continued annually.
According to the Treasury Department’s latest monthly statement, the U.S. has raised around $195 billion in customs duties in Fiscal Year 2025.
“Like so many Trump statements, the promise of $2,000 tariff rebate checks was so broadly phrased as to be hard to assess,” Calvin Jillson, a politics professor at Southern Methodist University, told Newsweek. “He certainly could not have meant a $2,000 check to every American, even every American adult or every taxpayer, as these would cost several times what the tariffs have brought in. Expect a much scaled-down version of the initial broad promise.”
What People Are Saying
President Donald Trump wrote on Truth Social: “People that are against Tariffs are FOOLS! We are now the Richest, Most Respected Country In the World, With Almost No Inflation, and A Record Stock Market Price. 401k’s are Highest EVER,” the president wrote. “A dividend of at least $2000 a person (not including high income people!) will be paid to everyone.”
Erica York, vice president of federal tax policy at the Tax Foundation, wrote on X: “The President just proposed a $2,000 tariff ‘dividend’ for each person, excluding high-income earners. If the cutoff is $100,000, 150M adults would qualify, for a cost near $300 billion. If kids qualify, that grows. Only problem, new tariffs have raised $120 billion so far.”
What Happens Next
For the plan to proceed, it would need to be approved by Congress. Meanwhile, the legality of Trump’s tariff policies will be decided by the Supreme Court. If they rule against the tariffs, this would further undermine Trump’s ability to issue stimulus checks.
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Trump is ramping up a new effort to convince a skeptical public he can fix affordability worries
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WASHINGTON (AP) — President Donald Trump is adjusting his messaging strategy to win over voters who are worried about the cost of living with plans to emphasize new tax breaks and show progress on fighting inflation.
The messaging is centered around affordability, and the push comes after inflation emerged as a major vulnerability for Trump and Republicans in Tuesday’s elections, in which voters overwhelmingly said the economy was their biggest concern.
Democrats took advantage of concerns about affordability to run up huge margins in the New Jersey and Virginia governor races, flipping what had been a strength for Trump in the 2024 presidential election into a vulnerability going into next year’s midterm elections.
White House officials and others familiar with their thinking requested anonymity to speak for this article in order to not get ahead of the president’s actions. They stressed that affordability has always been a priority for Trump, but the president plans to talk about it more, as he did Thursday when he announced that Eli Lilly and Novo Nordisk would reduce the price of their anti-obesity drugs.
“We are the ones that have done a great job on affordability, not the Democrats,” Trump said at an event in the Oval Office to announce the deal. “We just lost an election, they said, based on affordability. It’s a con job by the Democrats.”
The White House is keeping up a steady drumbeat of posts on social media about prices and deals for Thanksgiving dinner staples at retailers such as Walmart, Lidl, Aldi and Target.
“I don’t want to hear about the affordability, because right now, we’re much less,” Trump told reporters Thursday, arguing that things are much better for Americans with his party in charge.
“The only problem is the Republicans don’t talk about it,” he said.
The outlook for inflation is unclear
As of now, the inflation outlook has worsened under Trump. Consumer prices in September increased at an annual rate of 3%, up from 2.3% in April, when the president first began to roll out substantial tariff hikes that suddenly burdened the economy with uncertainty. The AP Voter Poll showed the economy was the leading issue in Tuesday’s elections in New Jersey, Virginia, New York City and California.
Grocery prices continue to climb, and recently, electricity bills have emerged as a new worry. At the same time, the pace of job gains has slowed, plunging 23% from the pace a year ago.
The White House maintains a list of talking points about the economy, noting that the stock market has hit record highs multiple times and that the president is attracting foreign investment. Trump has emphasized that gasoline prices are coming down, and maintained that gasoline is averaging $2 a gallon, but AAA reported Thursday that the national average was $3.08, about two cents lower than a year ago.
“Americans are paying less for essentials like gas and eggs, and today the Administration inked yet another drug pricing deal to deliver unprecedented health care savings for everyday Americans,” said White House spokesman Kush Desai.
Trump gets briefed about the economy by Treasury Secretary Scott Bessent and other officials at least once a week and there are often daily discussions on tariffs, a senior White House official said, noting Trump is expected to do more domestic travel next year to make his case that he’s fixing affordability.
But critics say it will be hard for Trump to turn around public perceptions on affordability.
“He’s in real trouble and I think it’s bigger than just cost of living,” said Lindsay Owens, executive director of Groundwork Collaborative, a liberal economic advocacy group.
Owens noted that Trump has “lost his strength” as voters are increasingly doubtful about Trump’s economic leadership compared to Democrats, adding that the president doesn’t have the time to turn around public perceptions of him as he continues to pursue broad tariffs.
New hype about income tax cuts ahead of April
There will be new policies rolled out on affordability, a person familiar with the White House thinking said, declining to comment on what those would be. Trump on Thursday indicated there will be more deals coming on drug prices. Two other White House officials said messaging would change — but not policy.
A big part of the administration’s response on affordability will be educating people ahead of tax season about the role of Trump’s income tax cuts in any refunds they receive in April, the person familiar with planning said. Those cuts were part of the sprawling bill Republicans muscled through Congress in July.
This individual stressed that the key challenge is bringing prices down while simultaneously having wages increase, so that people can feel and see any progress.
There’s also a bet that the economy will be in a healthier place in six months. With Federal Reserve Chair Jerome Powell’s term ending in May, the White House anticipates the start of consistent cuts to the Fed’s benchmark interest rate. They expect inflation rates to cool and declines in the federal budget deficit to boost sentiment in the financial markets.
But the U.S. economy seldom cooperates with a president’s intentions, a lesson learned most recently by Trump’s predecessor, Democrat Joe Biden, who saw his popularity slump after inflation spiked to a four-decade high in June 2022.
The Trump administration maintains it’s simply working through an inflation challenge inherited from Biden, but new economic research indicates Trump has created his own inflation challenge through tariffs.
Since April, Harvard University economist Alberto Cavallo and his colleagues, Northwestern University’s Paola Llamas and Universidad de San Andres’ Franco Vazquez, have been tracking the impact of the import taxes on consumer prices.
In an October paper, the economists found that the inflation rate would have been drastically lower at 2.2%, had it not been for Trump’s tariffs.
The administration maintains that tariffs have not contributed to inflation. They plan to make the case that the import taxes are helping the economy and dismiss criticisms of the import taxes as contributing to inflation as Democratic talking points.
The fate of Trump’s country-by-country tariffs is currently being decided by the Supreme Court, where justices at a Wednesday hearing seemed dubious over the administration’s claims that tariffs were essentially regulations and could be levied by a president without congressional approval. Trump has maintained at times that foreign countries pay the tariffs and not U.S. citizens, a claim he backed away from slightly Thursday.
“They might be paying something,” he said. “But when you take the overall impact, the Americans are gaining tremendously.”
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Associated Press writers Will Weissert and Michelle L. Price contributed to this report.
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What to know about Trump’s plan to give Americans a $2,000 tariff dividend
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WASHINGTON (AP) — President Donald Trump boasts that his tariffs protect American industries, lure factories to the United States, raise money for the federal government and give him diplomatic leverage.
Now, he’s claiming they can finance a windfall for American families, too: He’s promising a generous tariff dividend.
The president proposed the idea on his Truth Social media platform Sunday, five days after his Republican Party lost elections in Virginia, New Jersey and elsewhere largely because of voter discontent with his economic stewardship — specifically, the high cost of living.
The tariffs are bringing in so much money, the president posted, that “a dividend of at least $2000 a person (not including high income people!) will be paid to everyone.’’
Budget experts scoffed at the idea, which conjured memories of the Trump administration’s short-lived plan for DOGE dividend checks financed by billionaire Elon Musk’s federal budget cuts.
“The numbers just don’t check out,″ said Erica York, vice president of federal tax policy at the nonpartisan Tax Foundation.
Details are scarce, including what the income limits would be and whether payments would go to children.
Even Trump’s treasury secretary, Scott Bessent, sounded a bit blindsided by the audacious dividend plan. Appearing Sunday on ABC’s “This Week,’’ Bessent said he hadn’t discussed the dividend with the president and suggested that it might not mean that Americans would get a check from the government. Instead, Bessent said, the rebate might take the form of tax cuts.
The tariffs are certainly raising money — $195 billion in the budget year that ended Sept. 30, up 153% from $77 billion in fiscal 2024. But they still account for less than 4% of federal revenue and have done little to dent the federal budget deficit — a staggering $1.8 trillion in fiscal 2025.
Budget wonks say Trump’s dividend math doesn’t work.
John Ricco, an analyst with the Budget Lab at Yale University, reckons that Trump’s tariffs will bring in $200 billion to $300 billion a year in revenue. But a $2,000 dividend — if it went to all Americans, including children — would cost $600 billion. “It’s clear that the revenue coming in would not be adequate,’’ he said.
Ricco also noted that Trump couldn’t just pay the dividends on his own. They would require legislation from Congress.
Moreover, the centerpiece of Trump’s protectionist trade policies — double-digit taxes on imports from almost every country in the world — may not survive a legal challenge that has reached the U.S. Supreme Court.
In a hearing last week, the justices sounded skeptical about the Trump administration’s assertion of sweeping power to declare national emergencies to justify the tariffs. Trump has bypassed Congress, which has authority under the Constitution to levy taxes, including tariffs.
If the court strikes down the tariffs, the Trump administration may be refunding money to the importers who paid them, not sending dividend checks to American families. (Trump could find other ways to impose tariffs, even if he loses at the Supreme Court; but it could be cumbersome and time-consuming.)
Mainstream economists and budget analysts note that tariffs are paid by U.S. importers who then generally try to pass along the cost to their customers through higher prices.
The dividend plan “misses the mark,’’ the Tax Foundation’s York said. ”If the goal is relief for Americans, just get rid of the tariffs.’’
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What to know about Trump’s $2,000 tariff dividend proposal
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Over the weekend, President Donald Trump promised Americans $2,000 each from the “trillions of dollars” in tariff revenue he said his administration has collected.
During his second term, Trump has imposed tariffs broadly on countries and on specific goods such as drugs, steel and cars.
“People that are against Tariffs are FOOLS!,” Trump said in a Nov. 9 Truth Social post. “We are taking in Trillions of Dollars and will soon begin paying down our ENORMOUS DEBT, $37 Trillion. Record Investment in the USA, plants and factories going up all over the place. A dividend of at least $2000 a person (not including high income people!) will be paid to everyone.”
How seriously should people take his pledge? Experts urged caution.
Tariffs are projected to generate well below “trillions” a year, making it harder to pay each person $2,000. And the administration already said it would use the tariff revenue to either pay for existing tax cuts or to reduce the federal debt.
Trump’s post came days after the U.S. Supreme Court heard arguments about the legality of his tariff policy. The justices are weighing whether Trump has the power to unilaterally impose tariffs under the International Emergency Economic Powers Act. If the justices rule against Trump, much of the expected future tariff revenue would not materialize.
What Trump proposed, and who would qualify
The administration has published no plans for the tariff dividends, and in a Nov. 9 ABC News interview, Treasury Secretary Scott Bessent said he hadn’t spoken to Trump about giving Americans a dividend payment.
Details about a potential payment have been limited to Truth Social posts.
Trump said “everyone” excluding “high income people” would get the money, but didn’t explain who qualifies as “high income.” He also didn’t say whether children would receive the payment.
In a Nov. 10 Truth Social post, Trump said his administration would first pay $2,000 to “low and middle income USA Citizens,” and then use the remaining tariff revenues to “substantially pay down national debt.”
Trump hasn’t said what form the payments might take. Bessent said the dividend “could come in lots of forms, in lots of ways. You know, it could be just the tax decreases that we are seeing on the president’s agenda. You know, no tax on tips, no tax on overtime, no tax on Social Security, deductibility of auto loans. So, you know, those are substantial deductions.”
Analysts said it’s a stretch to rebrand an already promised tax cut as a new dividend.
Trump has previously discussed paying Americans with tariff revenue.
“We have so much money coming in, we’re thinking about a little rebate but the big thing we want to do is pay down debt,” he told reporters July 25. “We’re thinking about a rebate.”
Days later, Sen. Josh Hawley, R-Mo., introduced legislation that would give $600 tariff rebate checks to each American adult and child. Hawley’s bill has not advanced.
Tariff revenue collected versus cost of a “dividend” payment
Trump made the imposition of tariffs one of his signature 2024 campaign promises. Since taking office in January, he has enacted tariffs on a scale not seen in the U.S. in almost a century; the current overall average tariff rate is 18%, the highest since 1934, according to Yale Budget Lab.
Through the end of October, the federal government collected $309.2 billion in tariff revenue, compared with $165.4 billion through the same point in 2024, an increase of $143.8 billion.
The center-right Tax Foundation projects that tariff revenue will continue to increase to more than $200 billion a year if the tariffs remain in place.
Erica York, the Tax Foundation’s vice president of federal tax policy, estimated in a Nov. 9 X post that a $2,000 tariff dividend for each person earning under $100,000 would equal 150 million adult recipients. That would cost nearly $300 billion, York calculated, or more if children qualified. That’s more than the tariffs have raised so far, she said.
The Committee for a Responsible Federal Budget projected that Trump’s proposal could cost $600 billion, depending on how it is structured.
The administration previously detailed other uses for tariff revenue
The Trump administration already promised to use tariff revenue for other purposes, including reducing the country’s deficit and offsetting the cost of the GOP tax and spending bill Trump signed into law in July.
As Trump announced new tariffs April 2, he said he would “use trillions and trillions of dollars to reduce our taxes and pay down our national debt.”
Bessent has made the same promise, falsely saying in July that tariffs were “going to pay off our deficit.”
Bessent said in August that he and Trump were “laser focused on paying down the debt.”
“I think we’re going to bring down the deficit-to-GDP,” Bessent said in an Aug. 19 CNBC interview. “We’ll start paying down debt and then at a point that can be used as an offset to the American people.”
Tariffs’ current cost to Americans
Tariffs are already costing Americans money, analysts say. Independent estimates range from about $1,600 to $2,600 a year per household. Given the similarity of these amounts to Trump’s proposed dividend, York said it would be more efficient to remove the tariffs.
Joseph Rosenberg, Urban Institute-Brookings Institution Tax Policy Center senior fellow, said a $2,000 dividend in the form of a check would require congressional approval — and lawmakers have already declined to act on that idea once.
When members of Congress approved the One Big Beautiful Bill Act, “They had the ability to include a tariff dividend, but they didn’t,” Rosenberg said.
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Trump has other tariff options if the Supreme Court strikes down his worldwide import taxes
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WASHINGTON (AP) — President Donald Trump has warned that the United States will be rendered “defenseless’’ and possibly “reduced to almost Third World status” if the Supreme Court strikes down the tariffs he imposed this year on nearly every country on earth.
The justices sounded skeptical during oral arguments Wednesday of his sweeping claims of authority to impose tariffs as he sees fit.
The truth, though, is that Trump will still have plenty of options to keep taxing imports aggressively even if the court rules against him. He can re-use tariff powers he deployed in his first term and can reach for others, including one that dates back to the Great Depression.
“It’s hard to see any pathway here where tariffs end,” said Georgetown trade law professor Kathleen Claussen. “I am pretty convinced he could rebuild the tariff landscape he has now using other authorities.”
At Wednesday’s hearing, in fact, lawyer Neal Katyal, representing small businesses suing to get the tariffs struck down, argued that Trump didn’t need the boundless authority he’s claimed to impose tariffs under 1977 International Emergency Economic Powers Act (IEEPA). That is because Congress delegated tariff power to the White House in several other statutes — though it carefully limited the ways the president could use the authority.
“Congress knows exactly how to delegate its tariff powers,” Katyal said.
Tariffs have become a cornerstone of Trump’s foreign policy in his second term, with double-digit “reciprocal” tariffs imposed on most countries, which he has justified by declaring America’s longstanding trade deficits a national emergency.
The average U.S. tariff has gone from 2.5% when Trump returned to the White House in January to 17.9%, the highest since 1934, according to calculations by Yale University’s Budget Lab.
The president acted alone even though the U.S. Constitution specifically gives the power to tax – and impose tariffs – to Congress.
Still, Trump “will have other tools that can cause pain,’’ said Stratos Pahis of Brooklyn Law School. Here’s a look at some of his options:
Countering unfair trade practices
The United States has long had a handy cudgel to wallop countries it accuses of engaging in “unjustifiable,” “unreasonable” or “discriminatory” trade practices. That is Section 301 of the Trade Act of 1974.
And Trump has made aggressive use of it himself — especially against China. In his first term, he cited Section 301 to impose sweeping tariffs on Chinese imports in a dispute over the sharp-elbowed tactics that Beijing was using to challenge America’s technological dominance. The U.S. is also using 301 powers to counter what it calls unfair Chinese practices in the shipbuilding industry.
“You’ve had Section 301 tariffs in place against China for years,” said Ryan Majerus, a partner at King & Spalding and a trade official in Trump’s first administration and in Biden’s.
There are no limits on the size of Section 301 tariffs. They expire after four years but can be extended.
But the administration’s trade representative must conduct an investigation and typically hold a public hearing before imposing 301 tariffs.
John Veroneau, general counsel for the U.S. trade representative in the George W. Bush administration, said Section 301 is useful in taking on China. But it has drawbacks when it comes to dealing with the smaller countries that Trump has hammered with reciprocal tariffs.
“Undertaking dozens and dozens of 301 investigations of all of those countries is a laborious process,” Veroneau said.
Targeting trade deficits
In striking down Trump’s reciprocal tariffs in May, the U.S. Court of International Trade ruled that the president couldn’t use emergency powers to combat trade deficits.
That is partly because Congress had specifically given the White House limited authority to address the problem in another statute: Section 122, also of the Trade Act of 1974. That allows the president to impose tariffs of up to 15% for up to 150 days in response to unbalanced trade. The administration doesn’t even have to conduct an investigation beforehand.
But Section 122 authority has never been used to apply tariffs, and there is some uncertainty about how it would work.
Protecting national security
In both of his terms, Trump has made aggressive use of his power — under Section 232 of Trade Expansion Act of 1962 — to impose tariffs on imports that he deems a threat to national security.
In 2018, he slapped tariffs on foreign steel and aluminum, levies he’s expanded since returning to the White House. He also plastered Section 232 tariffs on autos, auto parts, copper, lumber.
In September, the president even levied Section 232 tariffs on kitchen cabinets, bathroom vanities and upholstered furniture. “Even though people might roll their eyes” at the notion that imported furniture poses a threat to national security, Veroneau said, “it’s difficult to get courts to second-guess a determination by a president on a national security matter.”
Section 232 tariffs are not limited by law but do require an investigation by the U.S. Commerce Department. It’s the administration itself that does the investigating – also true for Section 301 cases — “so they have a lot of control over the outcome,” Veroneau said.
Reviving Depression-era tariffs
Nearly a century ago, with the U.S. and world economies in collapse, Congress passed the Tariff Act of 1930, imposing hefty taxes on imports. Known as the Smoot-Hawley tariffs (for their congressional sponsors), these levies have been widely condemned by economists and historians for limiting world commerce and making the Great Depression worse. They also got a memorable pop culture shoutout in the 1986 movie “Ferris Bueller’s Day Off.”
Section 338 of the law authorizes the president to impose tariffs of up to 50% on imports from countries that have discriminated against U.S. businesses. No investigation is required, and there’s no limit on how long the tariffs can stay in place.
Those tariffs have never been imposed — U.S. trade negotiators traditionally have favored Section 301 sanctions instead — though the United States used the threat of them as a bargaining chip in trade talks in the 1930s.
In September, Treasury Secretary Scott Bessent told Reuters that the administration was considering Section 338 as a Plan B if the Supreme Court ruled against Trump’s use of emergency powers tariffs.
The Smoot-Hawley legislation has a bad reputation, Veroneau said, but Trump might find it appealing. “To be the first president to ever use it could have some cache.”
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Associated Press Staff Writer Lindsay Whitehurst contributed to this story.
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IRS Direct File won’t be available next year. Here’s what that means for taxpayers
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WASHINGTON (AP) — IRS Direct File, the electronic system for filing tax returns for free, will not be offered next year, the Trump administration has confirmed.
An email sent Monday from IRS official Cynthia Noe to state comptrollers that participate in the Direct File program said that “IRS Direct File will not be available in Filing Season 2026. No launch date has been set for the future.”
The program developed during Joe Biden’s presidency was credited by users with making tax filing easy, fast and economical. However, it faced criticism from Republican lawmakers, who called it a waste of taxpayer money because free filing programs already exist (though they are difficult to use), and from commercial tax preparation companies, which have made billions from charging people to use their software.
Treasury Secretary Scott Bessent, who is also the current IRS commissioner, told reporters at the White House on Wednesday that there are “better alternatives” to Direct File. “It wasn’t used very much,” he said. “And we think that the private sector can do a better job.”
The Center for Taxpayer Rights filed a Freedom of Information Act request for IRS’ latest evaluation of the program and the report says 296,531 taxpayers submitted accepted returns for the 2025 tax season through Direct File. That’s up from the 140,803 submitted accepted returns in 2024.
Direct File was rolled out as a pilot program in 2024 after the IRS was tasked with looking into how to create a “direct file” system as part of the money it received from the Inflation Reduction Act signed into law by Biden in 2022. The Democratic administration spent tens of millions of dollars developing the program.
Last May, the agency under Biden announced that the program would be made permanent.
But the IRS has faced intense blowback to Direct File from private tax preparation companies that have spent millions lobbying Congress. The average American typically spends about $140 preparing returns each year.
The program had been in limbo since the start of the Trump administration as Elon Musk and the Department of Government Efficiency slashed their way through the federal government. But The Associated Press reported in April that the administration planned to eliminate the program, with its future becoming clear after the IRS staff assigned to it were told to stop working on its development for the 2026 tax filing season.
As of Wednesday, the Direct File website states that “Direct File is closed. More information will be available at a later date.”
The Washington Post and NextGov first reported on the email to state comptrollers confirming the program would not be offered next year.
Adam Ruben, a vice president at the liberal-leaning Economic Security Project, said “it’s not surprising” that the program was eliminated.
“Trump’s billionaire friends get favors while honest, hardworking Americans will pay more to file their taxes,” he said.
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