I do not know if you find a small victory when you figure out something or solve a problem. I have always found that solving math problems gave me a sense of satisfaction — though it often took a while to come to the correct conclusion — especially when dealing with the meaning of odd mathematical terms.
That is why I find the semantics associated with President Donald Trump’s proposed $2,000 payment to lower- and middle-class tax brackets so fascinating. Trump has referred to this proposed payment as a “tariff rebate” as well as a “tariff dividend.” Doesn’t that sound so rewarding?
When we go to Menards to take advantage of the 11% rebate, it is not cash. It is in store credit on our own money. It really only costs Menards 5%, which they make back on the goods you have to purchase when redeeming your rebate later. But customers feel like winners … at their own expense. Similarly, a dividend is something paid on a stock you have already purchased … with your own money.
The claims that the exporter is “paying the tariff” are misleading. Because whether the U.S. importer pays the tariff to get the goods off the boat — subsequently raising the wholesale price to cover tariff expense — or the foreign exporter raises their prices to cover the cost of the tariff before unloading, the American consumer reimburses the tariff tax through the inflated price … with our own money. Ask any auto-parts retailer. We get to buy our own inflation.
Whether rebate or dividend, the words chosen by the administration admit to the source of the money — our own money. Both the U.S. Treasury and the Committee for Responsible Federal Budget have similar estimates of the current amount ($189 billion) collected through tariffs as well as the projected amount (an additional $80 billion to $100 billion) by year’s end, for a total of $270 billion to $300 billion. As proposed, the 2026 tariff dividend/rebate approaches $600 billion. U.S. Treasury Secretary Scott Blessent has said, “It will require legislation to accomplish this” dividend/ rebate.
Translation: The tariff money is already gone. Congress will have to borrow the entire $600 billion from the Fed to coverTrump’s proposed payment.
We, our children and our children’s children will have the privilege of paying off the “tariff rebate/dividend” — a dividend we are already paying for … with our own money … at least twice … maybe three times.
Merle McCallister is a Gibson
City resident and was a Frito-Lay corn supplier for 41 years. He can be reached at merle.mccallister@gmail.com.