National Economic Council Director Kevin Hassett recently addressed concerns regarding the potential inflationary impact of Department of Government Efficiency (DOGE) checks. President Donald Trump's proposal to provide taxpayers with 20% of savings identified by DOGE has raised fears of reigniting inflation, particularly as efforts have been made to combat the upward pressure on prices following the Covid-19 pandemic.
During a White House news briefing, Hassett dismissed worries about the so-called 'DOGE Dividend' contributing to inflation. He emphasized that government spending, rather than direct cash transfers to individuals, is the primary driver of inflation. Hassett also highlighted the tendency for individuals to save money received, which can help reduce demand and mitigate inflationary pressures.
It is important to note that while various factors have contributed to recent inflation in the United States, including supply chain disruptions and geopolitical events like Russia's invasion of Ukraine, some economists have pointed to significant government spending, such as stimulus checks, as a factor in overheating the economy.
President Trump's pledge to address inflation from the outset of his presidency has been met with caution from economists, who warn that other policies, such as tariffs and mass deportations, could potentially exacerbate the cost of goods and services for consumers.
