Three Ways You Can Tell Trump Is Lying about Tariff Rebates
Trump is lying about his tariffs again (or rather, still), in fact telling similar lies that he did in a letter that backfired before SCOTUS, because he boasted about how much revenue he was making.
But, perhaps because people are just tuning in, they’re treating Trump’s false claims as if they’re somehow less false than every other thing he says.
First, Trump promised he’d give all the non-rich $2000 rebates from his unlawful tariffs.
Then, he claimed there’d still be money leftover after he had sent people “free” money.
Then, he accused Democrats of making numbers up.
Then, he said it would create a national security crisis if the Supreme Court made him give back money he raised unlawfully.
But there are three ways you can tell Trump is just as full of shit as he always is.
First, because because Kevin Hassett invoked the Laffer Curve when trying to claim we could afford it.
Next, because — as Dean Baker laid out — the numbers don’t add up.
Doing the simple arithmetic, the country has 340 million people. If 10 percent of these people fit Trump’s definition of high-income, and therefore don’t get the rebate, roughly 300 million people would get the checks.
At $2,000 a piece it would come to $600 billion, more than twice what Trump is collecting from us with his import taxes. Since he’s already $330 billion short, how can Trump think he has money to pay down the national debt? Also, he seems not to know that our deficit this year is projected to be $1.8 trillion, so he is actually adding considerably to the debt and would be adding even more with his $600 billion tariff “rebate.”
Most importantly — the the likely reason he’s telling these particular lies right now — because when Trump got a stay from the first ruling that his tariffs were illegal, he promised to pay the tariffs back, at least for the plaintiffs, even while insisting it could not replace the revenue raised from the tariffs.
And a stay would not harm plaintiffs, who can be made whole through a refund, including interest, if tariffs paid during these appeals are ultimately held unlawful.
[snip]
And, absent a stay, the government will receive reduced revenue that it will be unable to recoup if the tariffs are ultimately upheld—another irreparable harm. See Department of Educ. v. California, 145 S. Ct. 966, 968-969 (2025) (per curiam).
2. Conversely, a stay would not cognizably harm plaintiffs. If tariffs imposed on plaintiffs during these appeals are ultimately held unlawful, then the government will issue refunds to plaintiffs, including any postjudgment interest that accrues. See Sunpreme Inc. v. United States, 2017 WL 65421, at *5 (C.I.T. Jan. 5, 2017) (“there is virtually no risk to Plaintiff that it would not be made whole should it prevail”). The balance of harms is not close.
Trump’s advisors have told him he’s going to lose at SCOTUS on this. And like a kid caught with his hand in the cookie jar, he’s trying to claim (simultaenously) that the cookies have already been eaten, but here, would you like some? in an effort to stave off an order to give the cookies back.
You could already tell in last week’s hearing that the Justices are struggling with the prospect of making Trump pay the money back.
JUSTICE BARRETT: And then if you win, tell me how the reimbursement process would work. Would it be a complete mess? I mean, you’re saying before the government promised reimbursement. And — and now you’re saying, you know, well, that’s rich, but how would this work? It seems to me like it could be a mess.
MR. KATYAL: So the first thing I would say is that just underscores how major a question this is, the very fact that you are dealing with this with quotas, there’s no refund process of — to the tunes of billions of dollars or embargoes, but there is here. But for our case, the way it would work is, in this case the government’s stipulated for the five plaintiffs that they would get their refunds. So for us that’s how it would work.
Your question, I take it, is about everyone else. We don’t have a class action or anything like that.
With respect to everyone else, there’s a whole specialized body of trade law. And 19 U.S.C. 1514 outlines all these administrative procedures. It’s a very complicated thing. There’s got to be an administrative protest. There was a Harbor Management case earlier that this Court was involved with in United States Shoe in which, you know, the refund process took a long time. There were any number of claims and equitable relief and —
JUSTICE BARRETT: So a mess.
MR. KATYAL: So it’s difficult, absolutely
JUSTICE BARRETT: Okay.
MR. KATYAL: We don’t — we don’t deny that it’s difficult, but I think what this Court has said in — in — in the McKesson case in 1990, a serious economic dislocation isn’t a reason to do something.
Northern Pipeline, you guys stayed your decision for a while in order to let the congressional process unfold. There may be a congressional process here as well.
You know, your — you know, you may be able to also — be that this Court could limit its decision to prospective relief under the John Q. Hammons case. There’s lots of possibilities.
Neal Katyal, in a rush to ensure that the payback question doesn’t given the Justices cause to make a really bad decision, quickly offered a bunch of terrible options for all the other people who’ve been paying Trump’s illegal taxes because Judges didn’t impose a stay. Trump may think the mere prospect of paying the money back might yet persuade his captive court to rule for him.
But more likely, Trump is just applying political pressure — on the Justices, with false claims about what the real numbers are, on his mob, in hopes they’ll provide another kind of pressure if denied money he claims is free but which in reality they’ve actually already paid out of pock themselves — to avoid being ordered to pay the money back to everyone.
If and when SCOTUS rules against Trump on the tariff issue, it will be a very significant loss, the first time right and left joined together to force Trump to stop doing something unlawful.
But if SCOTUS rules Trump has to pay the money back, to everyone, it will create the kind of fiscal challenge that could turn his current political woes into a crisis, not least because right wing members of Congress have been treating this tariff revenue as “free” money they could point to to pretend they were addressing the deficit.
And that’s why Trump is ranting about tariffs.
Not because he wants to give out “free” — in reality, unlawfully seized money that American consumers already paid — money. But because he doesn’t want to pay any consequences for his unlawful actions.
And he definitely wants to avoid the default reality: that Trump will be forced to pay back importers, but consumers will get nothing.
I’m not a Democratic Messaging Whiz, but competent messagers must be salivating at the Supremes saying
– the tariffs WERE illegal
– the tariffs WERE a tax on American consumers
– American importers who paid the tariffs up front get refunds from the government
– the only complicated part of the refund process is between US importers and US consumers, so, sorry, consumers. Maybe your GOP Congress can help?
Beyond that …
– also, please see the permanent TRUMP tax breaks for billionaires
– also, please see the OBBB cuts to SNAP ($186B), and the prices at your grocery stores (if you still have one)
Depending on what actually happens with ACA supplements in the next two months,
– also, please see your healthcare premiums, and the prices at your local hospitals (if you still have one) after poor people stop buying healthcare
The DOGE/OMB/OBBB cuts have hurt, and will continue to hurt, many smaller groups, but “hurting every American who buys food, who needs healthcare, and who buys anything imported from a country with illegal tariffs, all visible before the 2026 elections” is a master strategy worthy of Trump, Musk, Miller, and Vought.
I posted a longer comment, but wanted to call special attention to Kevin Hassett invoking the Laffer Curve as one proof the Trump administration is lying.
I think we all recognize that, but if commentators had said that bluntly after Reagan reduced taxes and then had to quickly raise them because Laffer and his curve proved to be “Laffably wrong”, we’d be living on a different planet now.
Thank you for going there in a one-sentence paragraph, harder to overlook!
Great analysis. You don’t find this anywhere else on the Web. Trump doesn’t even understand how tariffs work – talking about how much he “loves them” but not realizing who pays them, thinking its free money coming from foreigners. Dumb. Even a non-lawyer can read the Constitution and see that the levying of tariffs is the domain of the Article I (legislative) branch, not the Article II (executive) branch. Further, in terms of unwinding these illegal tariffs, who is going to compensate Americans for the retaliatory tariffs levied on American exporters to foreign countries who slapped tariffs on us in response to Trump’s illegal tariffs? Tariffs are for bullies.
In response to your concluding comment: “that Trump will be forced to pay back importers, but consumers will get nothing.” Some months ago, Amazon was reportedly considering adding a line-item to a customer’s order summary, showing how much the tariffs were adding to their bottom line. The White House itself stepped in and pressured Amazon to back off from that idea, calling it a “hostile and political act.” If it had done so, and especially if other retailers had followed its example, then shoppers would have known in advance how much they were owed in refunds, significantly reducing the likelihood that any court-ordered refund of illegal tariffs would stay in the pockets of billionaires instead of being returned to consumers. So part of the mess created by unwinding his illegal taxes was also caused by Trump himself.
The only way is TRUMP lies like we breathe.
Katyal showed remarkable restraint by not answering “Well, you should consider whether there would be moral hazard in a finding that the Administration’s actions are unlawful, but nevertheless shouldn’t be reversed because it would be difficult. I mean, doesn’t that just create an incentive for Administrations to ensure their unlawful actions are really ambitious in scale?”
I think the bigger restraint is that Katyal didn’t point out how the SCOTUS ruling on Trump v CASA, Inc. created some of the mess that Amy is so deeply concerned about. The tariffs could have stopped in September. But the Federal Appeals court vacated the CIT injunction pending the government’s appeal due to Trump v CASA, Inc.
One could also make the argument that when Trump got the ruling for Trump v U.S. , all he heard was “when the President does it, it’s not illegal.” So, again, any concern Amy has about “mess”, she can take that up with herself and her conservative colleagues.
Indeed, interesting point . A bit of self reflection for parts of SCOTUS ?
Katyal knows that it is just about never wise to antagonize or be sarcastic with a Supreme Court Justice.
I am pleased to see that he had prepared for the issue and his response was tailored for his clients with a little bit of helpful guidance on the general issue.
I don’t suppose it would have served Katyal’s interest to point out that this problem could have been avoided or at least minimized if the Supreme Court had granted cert on the Learning Resources case before their summer recess. https://www.scotusblog.com/2025/08/the-supreme-court-and-trumps-tariffs-an-explainer/
Hmm, I wonder if even the SC is now beginning to get worried about the erratic monster they’ve enabled. Purely for fiscal reasons, naturally. They got the wrong demagogue to further their “ein Führer” agenda.
PBS News Hour factchecked Trump hard last night.
Note: This is not the entire transcript, in case anyone’s thinking of suing me.
Trump has already “spent” a lot of the tariff income. He said the tariff income would be used to offset losses to farmers, to pay Argentina, and, now, to give every American $2,000.00. Of course, he can’t pay SNAP because there is a liquidity crisis.
We are now seeing the kind of thinking (or lack thereof) that led to his recurring personal bankruptcies.
If Trump had gone through a compliant Republican Congress for rubber stamping his tariff schemes, he could have kept the revenues and could have spread the blame for the catastrophes. “Moving fast and breaking things” has consequences.
“It seems to me like it could be a mess.”
Sorry, when did MAGA start caring about the consequences of their decisions?