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Trump proposes $2,000 rebates and 50-year mortgages amid economic backlash
Facing mounting public dissatisfaction over economic policies, US President Donald Trump has unveiled a series of proposals-including $2,000 rebates funded by tariff revenue and 50-year mortgages-to counter voter concerns ahead of the 2026 midterms. The moves follow Republican setbacks in last week's state elections, where affordability dominated exit polls.
Tariff-funded rebates face skepticism
The proposed $2,000 payments, framed as consumer relief, would effectively rebate revenue from Trump's import tariffs. However, economists warn the plan is financially unviable. Erica York, vice-president of tax policy at the Tax Foundation, estimates even a $100,000 income cap for eligibility would cost $300 billion-exceeding all tariff revenue collected to date and requiring deficit spending.
York also cautioned the cash infusion could worsen inflation by flooding the economy with consumer demand, echoing dynamics seen during COVID-19 stimulus. "More dollars chasing goods" risks driving prices higher, she said. Treasury Secretary Scott Bessent downplayed the proposal Sunday, suggesting tariff gains would instead lower 2025 tax rates under Trump's "Big, Beautiful Bill" spending package.
50-year mortgages draw bipartisan criticism
Trump's push for 50-year home loans-double the standard 30-year term-has sparked backlash, including from Republicans. Georgia Rep. Marjorie Taylor Greene dismissed the idea as a "boon for banks," arguing borrowers would pay far more in interest over time. Critics note the plan, floated without White House adviser input, reflects Trump's tendency to test policies publicly before formal vetting.
"It will ultimately reward lenders while people die before paying off their homes."
Rep. Marjorie Taylor Greene (R-GA)
Health subsidies and political calculus
Additional proposals include converting expiring health insurance subsidies into direct cash payments, letting consumers "negotiate their own insurance," Trump told Fox News. Yet all ideas require congressional approval-a steep hurdle given slim GOP majorities. Analysts suggest the flurry of announcements aims to reset economic messaging after Democratic wins in Virginia, New Jersey, and New York, where affordability campaigns propelled victories for figures like NYC Mayor Zohran Mamdani.
Exit polls confirmed the economy as voters' top concern, mirroring surveys showing eroding confidence in Trump's cost-cutting promises. The president's claims of falling prices-citing examples like Walmart's Thanksgiving meal deals-ignore context: this year's package contains fewer items and a smaller turkey. Meanwhile, his administration continues fighting to end food aid during the government shutdown.
Echoes of Biden's 2021 missteps
The scenario parallels 2021, when Joe Biden's team touted strong economic indicators as post-COVID inflation surged. Trump, who exploited that disconnect in his 2024 campaign, now faces a similar gap: while inflation sits at 3% (far below Biden-era peaks of 9.1%), voters remain pessimistic. White House aides are reportedly considering a national tour to reframe the economic narrative, though Trump's mixed messaging-simultaneously proposing relief while celebrating White House renovations-risks undermining the effort.
"It feels like they're throwing ideas against the wall to see what sticks."
Erica York, Tax Foundation
Modest measures amid broader uncertainty
Less controversial steps include a federal probe into beef prices and a deal to reduce obesity drug costs for uninsured buyers. Yet with congressional gridlock looming, even these may stall. As Republicans brace for 2026, Trump's economic pivot tests whether his political instincts-honed in rallies-can translate to governance from the Oval Office.
