The hottest topic of 2026 could be President Trump’s latest economic gambit: a proposed $2,000 "tariff dividend" check aimed at low- and middle-income Americans by late 2026.
Trump's plan would redistribute the millions of dollars generated by the administration’s aggressive import duties—which have already topped $174 billion this year—directly back into the pockets of consumers and, in theory, give rise to a boom in freight volume.
Contents of this video
00:00 10-44 intro; $2,000 tariff dividend checks
00:42 The good news and bad news
02:04 The chance of $2,000 checks being issued
04:03 Tarriff revenue and dividend checks
06:54 Freight and increased consumer demand
Speaker 1:
What could a $2,000 tariff dividend do for freight? Hey everybody, welcome back. I'm Jason Cannon and my co-host Ringing In the New Year with me is Matt Cole. President Donald Trump in November floated the idea of issuing a $2,000 dividend mid to late 2026 to middle income people and lower income people from the millions of dollars collected from tariffs.
Speaker 2:
Stimulus payments released during COVID helped set freight on fire, but not everyone will be eligible for the tariff dividend if and when it happens, and the overall amount is also smaller. Those dollars also face some headwinds, ironically sparked by tariffs and COVID stimulus payments.
Speaker 3:
The good news and bad news is that the bad news is it's probably not going to be as stimulative. Frankly, a lot of people are probably going to use it to pay off debt, which is what they did the first time around, except they had so much money they paid off debt and then went out and bought stuff anyway. This time you're probably going to get a much less significant uptick in consumption. But the good news is that's probably also going to mean we're not going to have the same kind of impact. I mean, for one thing, we had two issues in 2021, 2022 when it comes to inflation. Yes, we had this unprecedented amount of money, trillions of dollars going into the economy, but you also had this extraordinarily bizarre disruption in the supply chain because of labor and a whole host of other issues, in part because of that stimulus.
One of the big issues we had in the trucking as well as, especially the automotive sector, was the semiconductor shortage that we had in 2021. Well, that was driven because there was so much money being spent on buying new iPhones and buying new computers and everything like that. That sucked up all of that technology and workforce. So we're not going to get that kind of disruption. I really don't think that there's much downside to the $2,000 checks if we get them. The question is whether there's a significant amount of upside. And I think the jury is still out on that.
Speaker 1:
If those checks are issued is a big if, and not everybody's as optimistic as Avery when it comes to the potential downside of a nationwide $2,000 windfall.
Speaker 4:
I think the chance of that happening is very, very, very low. So I will say, I think there's practically no chance that that takes place. If it does, oh, it'll get interesting really quick because that will basically be a repeat of March of 2021. Will it cause a boom of freight? Oh yeah, it will. That will be okay. We get going for a few months. Now, here's going to be the problem though. Every importer in the world will raise their prices in response to that. And companies are already planning next year. Price increases going into effect right around the time that the tax refunds come out because folks are thinking, okay, the no tax on overtime and a lot of this stuff, that could spur some additional spending. And so what you're going to see happen is the Fed, assuming it's still independent, they start to see prices go up.
They've got one lever to pull, and you're already seeing a lot of the Fed presidents being very blunt that they're not expecting a December rate cut. They'll raise rates if they perceive that inflation is rearing its ugly head. So what I would say for everybody is be careful what you wish for. We should have learned our lesson back in 2021. The Biden administration made a horrible mistake with that March 2021 stimulus that drove so much of the inflationary pressure that we saw. You'll go through it. Again, it won't be as pronounced, but you will see everybody who's been watching their margins get compressed will uncompress their margins very, very, very rapidly. So would it be good for freight in the near term? Yes. Would it be good for freight in 2027? Probably not because we're going to be dealing with a higher interest rate environment as the Fed raises rates to combat price increases.
Speaker 2:
Jason Miller says his skepticism in getting the tariff dividends at all comes from simple math. The tariffs haven't generated the kind of money needed to stroke millions of checks for $2,000 each. Also, the President doesn't have the authority to unilaterally disperse the money by himself.
Speaker 4:
I don't see where that's going to come from. I don't see that passing through Congress. Combined with the fact that when you look at how much tariff revenue is coming in right now, revenue is about annualized somewhere between 300 and 350 billion a year. But if I just do a real quick math and we give 200 million Americans $2,000 each, that's $400 billion of money. So that would be handing out more than one year of the tariff revenue. So that blows a huge hole in the deficit. And what you then have too is maybe the 10 year yield goes from currently, I think right now it's hovering around four to 4.1. You may see the 10 year yield decide to hop itself up to 4.3, 4.4, 4.5, and then all of a sudden mortgages are now more expensive and you make housing even cooler than it is.
So this is the challenge we're in structurally right now is we have concerns about our government debt. We need the tariffs to help make that deficit look even remotely manageable. I mean, to be very clear, we're not paying down our debt with these tariffs because we're running a massive deficit, but the tariffs at least make the deficit not as massive. You take away the tariffs, deficit gets worse, 10-year yield gets more expensive. You may get a benefit from the freight economy side for more imports, but then that may slow housing even more if mortgage rates go up.
Speaker 1:
So let's be optimistic. We all get $2,000 in a few months. Avery says sudden infusion of two grand across the country could provide a temporary pop in consumer demand, which trucking firms have been looking for for three plus years.
Speaker 3:
There is the possibility that if everybody gets them at the same time, which I assume that would be the case, that we could have some sort of spurt in demand. And I think we're getting close enough to balance in capacity and freight that that could yield some upward movement in spot rates and that would bleed over into contract and we'd get some kind of improvement in the overall trucking environment beyond what we're currently forecasting.
Speaker 1:
That's it for this week's 10:44. You can read more on ccJdigital.com. While you're there, sign up for our newsletter and stay up to date on the latest in trucking industry news and trends. If you have any questions or feedback, please let us know in the comments below. Don't forget to subscribe and hit the bell for notifications so you can catch us again next week.
