President Donald Trump pledged in a Republican National Convention speech Wednesday (local time) that his administration would send Americans a $5,000 "dividend" if Republicans win control of Congress in the midterm elections. On Thursday (local time), he added that his administration would refund $500 each to about 1 million Americans across 30 states who were overcharged for health insurance premiums under the Affordable Care Act, widely known as Obamacare.
Trump posted a roughly two-minute speech video on the White House's official X account Thursday, saying, "Our administration has discovered that American families who signed up for health insurance through the disastrous Obamacare exchange under Sleepy Joe" — a derisive nickname Trump uses for former President Joe Biden — "were overcharged by massive amounts."
Trump claimed the overcharged amount totaled at least $500 million, asserting that "the previous administration knew about this and even investigated it, but they just kept the money. They never told anyone." He added, "Our administration is doing the right thing, and we are giving the money back to the people who were unjustly ripped off," pledging to issue the refunds.
Trump said the refunds would be paid out "in just a few weeks." The White House released a statement Thursday saying checks would be mailed to eligible Americans starting in October 2026.
The decision to roll out cash payments before the midterm elections is likely to intensify accusations of "vote-buying populism," with critics saying the federal government is pursuing crowd-pleasing policies ahead of the vote.
The dividend pledge Trump made at the Republican midterm convention speech in Dallas, Texas, on Thursday has likewise drawn criticism as vote-buying. Trump made the surprise pledge that, if Republicans retain their majorities in both chambers of Congress after the midterms, his administration would pay $5,000 to every qualifying American adult. The Democratic Party strongly condemned the pledge as "vote-buying," and media outlets have flagged controversy over its legality and feasibility.
Politico reported that the dividend Trump described "would far exceed the amounts distributed during the COVID-19 pandemic and would likely cause the fiscal deficit to balloon." With about 240 million American adults, paying $5,000 to each would bring the total to $1.2 trillion. CNBC noted that this sum is comparable to the $1.27 trillion in interest on the national debt that the US government has paid so far this fiscal year.
Both policies share a common thread of criticism: that they would add to the real economic burden on the public. Maya MacGuineas, president of the Committee for a Responsible Federal Budget, told The Washington Post that Trump's dividend "would increase borrowing, push up interest rates, weaken the economy over the long term, explode the debt, fuel inflation, and pass a bigger burden on to our children." She added, "This is not the moment to roll out a reckless pledge that would blow up the budget, when Americans are struggling with real cost-of-living pressures and the bond market is desperately pleading for fiscal discipline."
The pledge to refund overcharged Obamacare premiums has also reminded voters of criticism that Republicans drove up household insurance costs by ending Obamacare. In the US, government subsidies for health insurance premiums lapsed last year when Obamacare's subsidy program ended, and households have since reported sharply higher premium burdens. Large numbers of Americans have canceled or let their coverage lapse as a result.
In response, the Trump administration has proposed an alternative to the existing Obamacare model, under which the government pays subsidies directly to insurers. Instead, it wants to increase price transparency in the health care market and spur competition to bring down costs. Trump also said the refunds "will fully offset the premium hikes caused by Democrats, who are working hard to protect nothing but the big insurance companies," adding, "The big insurers control the Democratic Party."
He went on to say, "We are going to stop all payments to the big insurers and give that money directly to the people," adding, "Then people will be able to buy better health care at a much lower cost, and keep the money that's left over."
In an era when a single word from Trump can send global markets and economies swinging, keeping up with the flood of Trump news can be overwhelming — that is where "One Trump a Day" comes in. Starting at 5 a.m. each day, The Herald Business's international desk curates everything from the US stock market close to the key Trump news likely to move global asset markets, delivering it all in a one-minute read. Just one minute — on your commute, over a solo meal, or before bed. You can subscribe to the "One Trump a Day" newsletter on The Herald Business's website.
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