Commerce Secretary Howard Lutnick has stated that President Donald Trump's proposed $5,000 dividend checks for U.S. adults would not be funded by taxpayer money. In an interview with NBC News, Lutnick emphasized that the administration plans to "earn the money that Donald Trump wants to pay out, not from the deficit and not from taxpayers."

President Trump announced the proposal during the Republican National Committee's midterm convention in Dallas, Texas, promising the checks if Republicans retain control of Congress in the upcoming November elections. The plan, dubbed "the Trump dividend," could cost up to $1 trillion if distributed to all U.S. adults.

Lutnick mentioned potential funding sources, including a new visa program that could raise $500 billion by charging wealthy visitors up to $5 million to extend their visas. Additionally, he cited the government's investment in chipmaker Intel, which has significantly appreciated in value. According to The Guardian, Lutnick believes these initiatives could help finance the dividend checks.

Despite the administration's assurances, the proposal has faced criticism. Concerns have been raised about the potential impact on the national debt, which recently surpassed $40 trillion. Critics, including Florida Governor Ron DeSantis, argue that the plan could lead to increased debt and inflation. The Hill reports that DeSantis warned against borrowing more money to fund such initiatives.

The proposal has also sparked debate within the GOP, with some members questioning its feasibility and potential political implications. Politico notes that outgoing Rep. Ralph Norman expressed concerns about the growing national debt and the risks of tying government checks to election outcomes.

As the midterm elections approach, the administration continues to explore various funding avenues, including potential congressional approval through reconciliation. The outcome of these efforts remains to be seen, as the proposal faces both political and economic scrutiny.

The Legal Exchange with Todd Lutsky and Susan Powers