U.S. Sen. Josh Hawley speaks to reporters at the governor’s ham breakfast at the Missouri State Fair in Sedalia on Aug. 15 , 2024 (Annelise Hanshaw/Missouri Independent).

Recently, Missouri’s senior senator introduced the American Worker Rebate Act which promises “at least” $600 per adult and dependent child funded by revenue from President Donald Trump’s new tariffs. The proposed legislation represents a dangerous fiscal misstep that threatens to worsen inflation while squandering a rare opportunity to address America’s mounting debt crisis.

Hawley’s proposal goes against one of Our Republican Legacy’s five pillars — fiscal responsibility — which is being woefully overlooked by current Republicans.

Our Republican Legacy’s fiscal responsibility principle reads: “Historically, our party stood for fiscal responsibility. The explosion of national debt in recent years is a legacy of weakness that future Americans must inherit. We renew our historical commitment to a sound economy.”

Hawley’s proposed tariff rebate is an anathema to the very idea of fiscal responsibility and is an example of just how much the GOP has changed from what it used to be.

American workers deserve policies that genuinely improve their economic prospects, not Hawley’s political theater that provides temporary checks while imposing hidden long-term costs.

Tariffs are essentially taxes on imported goods, and those costs are inevitably passed along to consumers through higher prices. Hawley’s rebate scheme will have American families paying higher prices at the store while receiving what amounts to their own money back—minus the administrative costs of collection and redistribution.

The inflationary risks of Hawley’s plan cannot be overstated. The U.S. has brought in a record $150 billion worth of tariff revenue so far, but that economic burden came directly from American consumers and businesses.

Rather than allowing this contractionary effect to help cool inflation, Hawley proposes pumping the tariff revenue directly back into consumer spending through cash payments. This creates a perfect storm for further price increases with tariffs driving up the cost of imported goods while rebate checks increase consumer demand, pushing prices higher across the board.

The Federal Reserve has spent the past few post-Covid years fighting to bring inflation under control, raising interest rates and implementing contractionary monetary policy to reduce demand pressures in the economy. Hawley’s rebate scheme would effectively counteract these efforts by providing fiscal stimulus precisely when the economy needs restraint.

For a family of four potentially receiving $2,400, the immediate gratification of cash payments would be quickly eroded by the resulting price increases on everything from groceries to housing.

Hawley’s tariff rebate plan offers an economic sugar rush mixed with short-term political gain at the expense of long-term economic stability.

As troublesome as the risk of inflation, Hawley’s proposal also misses a massive opportunity for debt reduction. With the national debt approaching dangerous levels and interest payments consuming an ever-larger share of federal revenues, the $150 billion in tariff collections could make a meaningful dent in our fiscal obligations.

Our Republican Legacy’s founder and former Sen. John Danforth had the following to say: “Hawley’s plan which, as I understand it, would give $600 to every man, woman and child in America, is the opposite of one of (Our Republican Legacy’s) core principles of fiscal responsibility. The current Republican program blows the lid off the national debt which now stands at $37 trillion and, under the so-called Big Beautiful Bill, will grow an additional $3.4 trillion over the next 10 years.”

Reducing the national debt would lower the government’s interest burden, freeing up resources for productive investments in infrastructure, education, and defense. It would also strengthen America’s fiscal position for future economic challenges and reduce the intergenerational burden we’re placing on young Americans. Every dollar spent on rebates today is a dollar not available for debt reduction, meaning higher taxes or reduced services for future generations.

Again, from Danforth: “As I understand Hawley’s proposal, that increase in the debt is not enough. He would increase it by an additional $200 billion in a one-time payment to all.”

Rather than fueling inflation through misguided stimulus, Congress should demonstrate genuine leadership by either repealing the tariffs, which is within their Constitutional powers, or apply the tariff revenue to debt reduction, providing lasting benefits for all Americans while avoiding the inflationary trap this proposal would create.

While it remains to be seen whether Hawley’s proposed legislation would ever become law, this isn’t the first time Hawley has embraced the idea of sending out checks. During the COVID-19 pandemic, Hawley was a lone Republican calling for additional rounds of stimulus checks back in 2020, even teaming up with democratic socialist, U.S. Sen. Bernie Sanders.

Hawley’s populist, political and economic shell game is likely to hurt hard working Americans.

This post was originally authored and published by Lynn Schmidt from Missouri Independent via RSS Feed. Join today to get your news feed on Nationwide Report®.