What's the deal with the $5,000 'DOGE Dividend' checks?

Is it like a stimulus check, or a tax credit, or even universal basic income? Read on.

On February 18, 2025, a man named James Fishback (an advisor to the 'Department of Government Efficiency') shared his proposal on X (formerly Twitter) for what he calls a "DOGE Dividend", to which Elon Musk replied that he'd check with Trump about it, and then Trump the following day said he loved it. Now, as I write this, a lot of people think they're about to get $5,000. If you're one of the people hoping for that check, keep reading and please note that none of this is to endorse the cutting of everything that's being cut.

First and foremost, the $5,000 number comes from being 20% of $2 trillion, which is the number that Elon Musk claimed that DOGE would eliminate in federal spending. That number is not a serious number. "It is completely impossible for DOGE to save $2 trillion," Jessica Riedl, an economist and senior fellow at the conservative-leaning Manhattan Institute told CBS. "Two-thirds of the [$6.3 trillion] federal budget goes to Social Security, Medicare, defense, veterans and interest on the debt — all of which has been taken off the table by President Trump. Saving $2 trillion would require eliminating nearly every remaining federal program.”

So right off the bat, if the DOGE dividend does happen, and it sticks to the plan of being 20% payment and 80% deficit reduction, the payment would be far less than $5,000. As I write this, DOGE has cut around $7.3 billion. If they manage to keep that rate up, it could mean $80 billion by the end of the year. The DOGE dividend check would be $202 with that amount of cuts, not $5,000.

Next, most people appear to be assuming that the DOGE dividend checks are per person. They are not. As proposed, they are per household. So if there's two of you in your house, think of it as $2,500 per person. If five people, think of it as $1,000 per person. They are also not for all households. They are only meant for those households with incomes higher than the standard deduction, which is about $30,000 for a couple. This means that the bottom 40% of all households would be excluded from the check. There are about 131 million households in America and only 79 million of them would get a check based on this plan.

That is very much by design. As Fishback explains in his proposal, "The conditional nature of the tax refund (available only to payers of federal income tax in CY 2025) incentivizes labor force participation because only net payers of federal income tax in CY 2025 are eligible to receive President Trump’s 'DOGE Dividend.'” By excluding everyone who doesn't earn enough income to owe taxes after subtracting the standard deduction from their gross earnings, the goal is to encourage everyone in the bottom 40% to work harder this year to earn more.

If you believe that universal basic income is a good idea as I do, this isn't it. Where UBI lacks any income requirement, this would impose a large one and effectively label every American earning less than $30,000 as lazy and unworthy, no matter how many jobs they have, or how many hours a week they're working.

About 52 million households would get no DOGE Dividend. It's hard to say how many of them voted for Trump, but it's likely somewhere around one-third of them based on exit polls and income data. Based on that estimate, over 17 million Trump-voting households would get nothing under this plan. This is a significant percentage of the 77 million people who voted for Trump considering how many households have more than one Trump voter.

At first I thought this proposal was like a non-refundable tax credit where people would only receive $5,000 if they paid over $5,000 in federal taxes, and $1 if they paid $1, but no, it does appear that even if you only paid $1 in federal tax, your household would qualify for whatever the dividend amount ends up being.

When would you get it? As proposed, those who do qualify for this payment would not receive it until after their taxes are filed next year. So if anyone is hoping to get a check this year, not only would it very likely not be anywhere near $5,000, you would not get it until after you file your taxes next year.

I should also mention that Fishback claims that this idea came to him in a dream, so that's interesting. Also interesting, the fact it's based on 20% of spending cuts is similar to my own belief that a UBI should be structured as a GDP dividend where 20% of GDP per capita is what flows to all citizens every month as their share of productivity growth. Whereas Fishback and Elon and Trump wish to create an incentive to cut federal spending, I wish to create an incentive to grow productivity. Whereas they want people to feel like they deserve a share of the government shrinking, I want people to feel like they deserve a share of the economy growing. As AI and robots begin performing more and more labor for us, they should literally work for all of us, especially since they were trained on our data and funded by our federal research dollars.

Finally, I want people to consider the nature of a proposal like this. This is a one-time payment for the ending of many federal jobs doing all kinds of things for the foreseeable future. Is it worth a one-time $200 check to end incredibly valuable research that no business is ever going to do because it isn't profitable? Is it worth it to decimate IRS jobs that for every $1 generate $12 in tax revenue from the wealthiest Americans who already pay a lower tax rate than you? Is it worth it to hamper the ability of FEMA to respond to future disasters that impact you? Is it worth it to make your food less safe to eat and predatory businesses more free to deceive and defraud you out of far more than $200?

One more thing. I will say that what's most interesting to me about the DOGE Dividend proposal is that it's clearly a popular idea to send people money and people are already excited about it. It's possible that the idea can grow into something else if popular enough. Maybe Trump's base will get angry about so many of them not getting it and as a result the proposal could be modified to be universal. That would set a precedent. Maybe the desire to create a check closer in size to $5,000, and per person instead of per household, would lead Trump to consider rebating tariff revenue or issuing a regular dividend from the sovereign wealth fund he's having created, just as Alaska does every year, and has since 1982.

To me, those are silver linings of what I personally consider to be a disaster.

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