A concept that originated on social media has gained traction in the White House, receiving an enthusiastic endorsement from President Donald Trump: Utilize some of the savings from billionaire Elon Musk’s initiative to cut government spending and return it to taxpayers. “I love it,” Trump expressed on Wednesday aboard Air Force One when queried about the idea.
If Musk successfully targets $2 trillion in cuts by next year, proponents of the plan argue that around one-fifth of those savings could be issued to taxpaying households in checks of approximately $5,000. However, before you start envisioning a financial windfall, budget experts caution that such massive savings—representing nearly one-third of the federal government’s yearly expenditure—are highly improbable. Moreover, sending out checks—akin to the stimulus payments disbursed during the pandemic under Trump and President Joe Biden—could potentially spur inflation, according to economists, though White House officials dismiss this concern.
With the annual budget deficit recorded at $1.8 trillion last year and Trump proposing considerable tax reductions, there will likely be substantial pressure to allocate all savings toward deficit reduction instead of distributing part of it to citizens.
Here’s what you need to know about the proposal:
Where is this coming from?
James Fishback, the founder of the investment firm Azoria Partners, which he established at Trump’s Mar-a-Lago estate in Florida, advocated for this idea on X (formerly known as Twitter) on Tuesday, prompting Musk to indicate he would “check with the president.” Fishback noted that there have also been “behind the scenes” discussions regarding the matter with White House officials.
Musk estimates that his Department of Government Efficiency has achieved $55 billion in cuts thus far—a minor portion of the $6.8 trillion federal budget. However, the DOGE’s public declarations have yet to substantiate these claimed savings, and its assertions that tens of millions of deceased individuals are illicitly receiving Social Security have been disproven.
Fishback advocates for the nonpartisan Congressional Budget Office to assess how much DOGE has saved. If DOGE squeezes out $500 billion by July 2026, he stated that the checks would amount to $1,250 rather than $5,000. “We uncovered enormous waste, fraud, and abuse,” Fishback remarked in an interview with The Associated Press. “And we are going to make good and pay restitution and then rewrite the social contract between the taxpayer and the federal government.”
Fishback favors distributing checks instead of using all the savings to diminish the deficit, as it would incentivize citizens to identify wasteful government spending “within their communities and report it to DOGE.”
When am I going to get my check?
Let’s temper expectations. According to the proposal, DOGE must first wrap up its work, which is scheduled for completion by July 2026.
Video above: NASA under a microscope as DOGE makes on-site visits
Once that’s achieved, one-fifth of any savings could be distributed later that year to approximately 79 million households that pay income taxes. About 40% of Americans do not pay such taxes, meaning they would not receive a check.
How much can DOGE really save?
Many economists and budget specialists appear dubious about the effectiveness of DOGE’s focus on “waste, fraud, and abuse” in meaningfully reducing government spending. Budget-cutters from both political parties have attempted for decades to eliminate “waste”—which lacks a strong political base—without significant success in curbing the deficit.
A significant strategy implemented by the Trump administration involved terminating tens of thousands of government employees; however, such moves are unlikely to yield substantial savings. “Only a small share of total spending goes to federal employees,” stated Douglas Elmendorf, former director of the Congressional Budget Office. “The big savings lie in federal benefits and taxes, which are not within DOGE’s scope.”
In an essay for the Brookings Institution, John DiIulio Jr., a political scientist at the University of Pennsylvania, noted that “eliminating the entire federal civilian workforce would leave intact about 95% of all federal spending and the $34 trillion national debt.” He emphasized that government contractors and nonprofits currently employing three times as many individuals as the federal government’s 2.2 million employees receive substantial government funds.
Additionally, it remains uncertain how much can be saved without Congress formalizing it in law. “Firing someone doesn’t save money until Congress subsequently slashes the appropriation for that employee’s agency,” Elmendorf explained. “If you terminate an employee but retain the appropriation, the funds can still be allocated elsewhere. Thus, DOGE can’t truly realize savings until there’s legislative reform.”
Wouldn’t another round of government checks contribute to higher inflation?
Trump and his economic advisors attribute rising inflation—reaching its highest spike in four decades—to Biden’s $1,200 stimulus checks issued in spring 2021. Yet they argue that distributing checks derived from reduced government spending wouldn’t exacerbate inflation.
Kevin Hassett, director of the White House’s National Economic Council, asserted that since the funds would have been spent by the government in any case, distributing them to consumers would result in a net-zero effect. Unlike the deficit-financed stimulus payments issued during the pandemic, the funds from DOGE would come from savings.
Video above: IRS begins firing workers amid tax season
Conversely, Ernie Tedeschi, director of economics at the Yale Budget Lab and a Biden White House economist, stated that issuing more government checks is “the last thing we need economically right now.” He pointed out that the current U.S. unemployment rate is significantly lower than in 2021, suggesting that companies might struggle to hire enough workers to accommodate the additional demand generated by another round of checks. Worker shortages, therefore, could lead to increased prices.
Some Democrats, however, share Hassett’s view for different reasons. “I can’t foresee them being inflationary because I can’t imagine the amounts being substantial enough,” remarked Elaine Kamarck, a senior fellow in governance studies at the Brookings Institution. Kamarck, who collaborated with Vice President Al Gore to diminish government waste during the Clinton administration, described the DOGE dividend idea as “ridiculous.” “There’s no money there, and certainly not enough to make a significant impact on taxpayers,” she said. “The guy just makes statements,” she added, referring to Musk.
