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White House National Economic Council Director Kevin Hassett is defending President Donald Trump’s proposal to send $5,000 checks to every adult United States citizen.

He dismissed concerns that the payments would deepen anxiety over Washington’s already historic borrowing burden.

“We can do it in a fiscally responsible way,” Hassett said Thursday during an interview with Bloomberg TV. “It is a serious proposal.”

The plan would represent an enormous transfer of money from the federal government to American households.

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Depending on eligibility requirements and final participation, the checks could add more than $1 trillion to federal spending.

That price tag immediately raises questions about the national debt, annual deficits and the risk of renewed inflation.

Washington would have to identify credible spending reductions, additional revenue or some combination of both to prevent the checks from simply becoming another debt financed benefit.

Hassett argued that strong economic expansion and rising national wealth could provide room for returning money to taxpayers.

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He said that “because of all the growth and all the wealth being created in the US, the president thinks we need to return more of that to the American people.”

One potential route would be a reconciliation bill, which allows the majority party in Congress to advance certain tax and spending legislation without support from the minority party.

Republicans would still need enough unity in the House and Senate to overcome internal concerns about cost.

When asked what fiscal offsets could accompany the checks, Hassett offered no specific spending reductions or revenue measures.

He said those details would need to be “negotiated with Congress.”

That answer leaves the central fiscal challenge unresolved, particularly as the federal debt burden moves toward record territory.

A payment may be popular with voters, but popularity does not erase the need for arithmetic that protects taxpayers from a larger bill later.

Trump introduced the $5,000 proposal earlier in the week and tied it to Republicans maintaining control of Congress.

The condition gives the idea an unmistakable political dimension as both parties prepare for another consequential election battle.

“The bottom line is there are multiple paths to getting it done,” Hassett said. He then added, “don’t underestimate President Trump.”

Still, congressional approval appears far from certain. Leading Republicans in both the House and Senate responded cautiously, suggesting that lawmakers are not yet prepared to embrace another sweeping federal payment program.

Analysts at Evercore ISI were considerably more skeptical about the proposal’s prospects.

They described the plan as an attention grabbing promise “to all adults if Republicans win the midterms” and warned that it would face resistance “in Congress, due to the massive fiscal cost and inflationary impacts.”

The inflation concern is especially significant because sending more than $1 trillion into the economy could strengthen consumer demand while prices remain elevated.

If the supply of goods and services does not keep pace, households could eventually lose part of the payment’s value through higher living costs.

Hassett also addressed the August consumer price index report, which showed that inflation accelerated during the month.

He emphasized, however, that the broader three month trend continued to show deceleration, offering a less alarming view of the latest figures.

The Federal Reserve will now weigh that inflation data as officials consider whether interest rates should rise at the next policy meeting.

Higher rates could pressure stocks, bonds, mortgages and business investment, while also making federal debt service even more expensive.

Asked how Trump might respond if the central bank approved a significant rate increase, Hassett predicted the president would not remain silent. “I would guess that if the Fed makes a big move, the president will have something to say about it.”

The proposal therefore lands at the intersection of election politics, inflation risk and deteriorating federal finances.

Hassett insists the checks can be structured responsibly, but until Congress produces actual offsets, the trillion dollar question remains unanswered.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.