An idea first proposed on social media bubbled up to the White House and received President Donald Trump's enthusiastic endorsement: Take some of the savings from billionaire Elon Musk's drive to cut government spending and return it to taxpayers.
"I love it," Trump said late Wednesday on Air Force One, when asked about the proposal.
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President Donald Trump speaks Feb. 11 as he is joined by Elon Musk, and his son X 脝 A-Xii, in the Oval Office at the White House in Washington.
If Musk's target of $2 trillion in spending cuts is achieved by next year, supporters of the idea say about one-fifth of those funds could be distributed to taxpaying households in checks of about $5,000.
However, budget experts say such huge savings 鈥 nearly one-third of the federal government's annual spending 鈥 are highly unlikely. Economists also warn that sending out checks 鈥 similar to the stimulus payments distributed by Trump and then President Joe Biden during the COVID-19 pandemic 鈥 could fuel inflation.
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With the annual budget deficit at $1.8 trillion last year and Trump proposing extensive tax cuts, there also will聽be significant pressure to use all the savings to reduce that deficit, rather than pass on part of it.
Here's what to know:
Where is this coming from?
James Fishback, founder of investment firm Azoria Partners which he launched at Trump's Mar-a-Lago estate in Florida, promoted the idea on the social media platform X, prompting Musk to respond that he would "check with the president." Fishback said there were "behind the scenes" conversations about the issue with White House officials.
Musk estimated his Department of Government Efficiency cut $55 billion so far 鈥 a tiny fraction of the $6.8 trillion federal budget. But DOGE so far hasn't verified the presumed savings, and its claims that millions of dead people fraudulently received Social Security benefits were disproven.
Fishback supports having the nonpartisan Congressional Budget Office determine how much DOGE saved. If DOGE cuts $500 billion by July 2026, he said, then the checks would be $1,250 rather than $5,000.
He said he backs sending out checks, rather than using all the money to reduce the deficit, because it would encourage Americans to seek out wasteful government spending "in their communities, and report it to DOGE."
When do we get checks?
OK, slow down. According to the proposal, DOGE must first complete its work, slated to be done by July 2026. Once that happens, one-fifth of any savings could be distributed later that year to the roughly 79 million households that pay income taxes.
About 40% of Americans don't pay such taxes, so they wouldn't get a check.
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A demonstrator holds a poster displaying a prohibited traffic sign reading "Musk DOGE" during a rally to protest President Trump's policies on Presidents Day Monday, Feb. 17, 2025, in Los Angeles. (AP Photo/Etienne Laurent)
How much can DOGE save?
Most economists and budget experts are skeptical that its focus on "waste, fraud, and abuse" can actually reduce government spending by much. Budget-cutters from both parties sought to eliminate "waste" for decades, with little success in reducing the deficit.
The Trump administration fired tens of thousands of government workers, but such changes aren't likely to produce big savings.
"Only a small share of total spending goes to federal employees," said Douglas Elmendorf, former director of the Congressional Budget Office. "The big money is in federal benefits and in federal taxes and those are not in DOGE's purview."
In November, John DiIulio Jr., a political scientist at the University of Pennsylvania, wrote in an essay for the Brookings Institution that "eliminating the entire federal civilian workforce would leave in place about 95% of all federal spending and the $34 trillion national debt." He noted government contractors and nonprofits that receive government funds now employ three times as many people as the federal government's 2.2 million employees.
It's also not clear how much in savings can be achieved without Congress codifying it in law.
鈥淔iring someone doesn鈥檛 save money until Congress comes back and reduces the appropriation for that employee鈥檚 agency,鈥 Elmendorf said.
Would checks contribute to inflation?
Trump and his economists blame Biden's $1,200 stimulus checks, distributed in 2021, for fueling the worst spike in inflation in four decades. Yet they maintain that sending checks stemming from reduced government spending wouldn't boost inflation.
Kevin Hassett, director of the White House's National Economic Council, said that since the money would have been spent by the government anyway, having it spent by consumers would be a wash. The pandemic stimulus checks were deficit-financed, which can be more inflationary.
But Ernie Tedeschi, director of economics at the Yale Budget Lab, and an economist in the Biden White House, said more government checks are "the last thing we need economically right now."
The U.S. unemployment rate is now much lower than in 2021, he said, which means businesses could struggle to hire enough workers to meet the additional demand created by such checks. Worker shortages can push up prices.