This week in Alaska, President Trump reupped his promise of $5,000 to every American if Republicans win the midterms. That follows his $500 payments to Obamacarers and $90 to Medicare beneficiaries, plus so-far-unfulfilled pledges of rebates from tariff revenue or Department of Government Efficiency savings.

All politicians in their gut believe voters can be bought. Trump is simply more transparent about it. Yet the puzzling thing is that shoveling money at voters has a terrible electoral track record.

During Trump’s first term, Republicans passed a big tax cut timed to fatten paychecks ahead of the 2018 midterms. But the bill was underwater with voters almost from day one, and that fall Republicans lost the House of Representatives.

Republicans wrote last year’s One Big Beautiful Bill to inject cash into voter wallets ahead of the midterms, and taxes remain their No. 1 ad theme, according to AdImpact. Yet a July Politico poll found more people thought the bill hurt them than helped (which, based on the bill’s contents, makes little sense).

Trump may be inspired by the popularity of the checks distributed as Covid-19 relief in 2020. In 2021, President Joe Biden included $1,400 checks in his stimulus bill. Far from thankful, voters were furious at the inflation that followed and handed Democrats stinging defeats in the 2022 midterm and 2024 presidential elections.

That may help explain why Trump’s $5,000 offer isn’t helping Republicans. By 64% to 23%, respondents to a Wall Street Journal poll last month called it a bad rather than good idea.

This doesn’t reflect newfound fiscal prudence on the part of the public. Rather, it is what Nobel-winning behavioral economist Richard Thaler calls the “endowment effect”: we put more value on something we already have than something we don’t. Voters are unmoved by new tax cuts or cash handouts yet dead set against cuts to their existing programs or increases to current taxes. It also explains why they support capping or reducing prices: they remember the low prices they paid back in 2020 and want them back.

Public opinion alone won’t get Congress to dig us out of our $2 trillion annual deficit hole, but it might get it to stop digging.

“The socialist threat is coming from inside the house.”So declares the Cato Institute’s Scott Lincicome upon rolling out a new dashboard showing that, since June last year, the U.S. has taken equity stakes in 35 companies. Lincicome could find no precedent in the prior 80 years for taking such stakes in healthy companies outside of crises or war. While the public broadly opposes such purchases, a poll by the Economic Innovation Group finds more Republicans (29%) than Democrats (22%) support them.

Inflation is bad. It may get better. A few weeks ahead of a midterm election focused on affordability, headline inflation climbed because of the Iran war’s impact on energy. Even without food and energy, core prices rose a more-than-expected 0.3%, or 2.6% on the year, increasing the probability the Federal Reserve raises rates again. One contributor: The AI build-out is pushing up computer-equipment prices.

But relief may be in store. Goldman Sachs economists estimate AI pressures have boosted the core personal-consumption-expenditures inflation rate by 0.45 percentage point, of which half is due to mismeasurement. They expect this contribution to fade to 0.1 point in the coming year.

Governments that borrow short invite trouble. Treasury Secretary Scott Bessent is reducing dependence on long-term bonds to finance the deficit, hoping to keep down long-term rates. But borrowing short when inflation threatens to push short-term rates higher can “amplify the monetary-fiscal feedback,” warn Era Dabla-Norris and Rodrigo Valdés of the International Monetary Fund. An accompanying research report says central-bank rate hikes can “lead to large and persistent increases in public debt, more pronounced deteriorations in fiscal and financial conditions, and significantly larger declines in output, inflation, and private investment.”

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Thursday Friday Sunday I’m The Wall Street Journal’s chief economics commentator. I’ve been writing about economics, markets and politics for more than 40 years, in the U.S. and from around the world.

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