Besenet: Supports the "$5,000 check" and it will not increase the deficit; Speaker of the House: Implementation of the plan will take time

US Treasury Secretary Besant expressed support for the proposal to issue $5,000 checks to American adults, while downplaying concerns over fiscal costs. This statement comes as the size of US Treasury debt continues to swell and financial markets grow more anxious about fiscal prospects.

Testifying before Congress on Tuesday, Besant stated that “there are ways” to implement the plan without increasing the deficit, but did not disclose any specific cost-offsetting measures. He said the Treasury has been studying this for “quite some time” and emphasized that “putting more money in Americans’ pockets should be everyone’s goal.”

In Congress, House Speaker Mike Johnson said on Tuesday that he had communicated with the President on the topic the previous night, but details had “not yet been finalized” and it would “take some time” before anything comes into effect. Johnson was unable to provide clear answers regarding whether the checks would be subject to income limits, whether federal debt would increase, or if legislation could be completed this year.

Republican Senate Majority Leader John Thune stated on Tuesday that financial market trends and the trajectory of US debt are “really worrying.” He called for caution in spending decisions and for seeking ways to slow government spending growth, without endorsing the $5,000 check proposal.

The proposal is currently expected to cost over $1 trillion, while this year’s US fiscal deficit has already neared $2 trillion. Meanwhile, surging capital investment and soaring energy prices have triggered a global bond sell-off; on Tuesday, the 10-year US Treasury yield rose above 5% again, reaching its highest level in nearly two decades.

At Tuesday’s congressional hearing, Besant responded to lawmakers’ questions by making it clear that he supports the $5,000 “dividend check” plan promised by Trump last week.

He said if moving the proposal forward requires congressional authorization, he would work together with House Speaker Mike Johnson to promote it, adding that the President’s intentions are “very real.”

However, Besant did not provide any details on how the related spending would be offset. He only stated that the Treasury has been studying this “for quite a long time”, leaving the market’s questions about the cost source unanswered.

In an interview last week, Trump suggested that he believes issuing the checks “might not need congressional approval at all,” but Republican lawmakers have not yet issued a clear statement on this point.

Last month, the US Treasury debt surpassed $40 trillion, triggering broader concerns about the long-term sustainability of US finances.

At the same time, the 10-year US Treasury yield rose above 5% on Tuesday, hitting its highest level in nearly twenty years. This marks the latest milestone in the ongoing global bond sell-off—a sell-off driven by surging capital investment and high energy prices, further intensifying inflationary pressures.

Against this backdrop, Besant’s promise that the $5,000 checks will “not impact the deficit” leaves markets struggling to find a rationale.

The projected cost of over $1 trillion, in addition to the current annual fiscal deficit of about $2 trillion, means investors will closely scrutinize any new spending measures for their potential impact on the trajectory of US debt.