Originally published 2020-10-20.
In mid-October 2020, less than three weeks before the presidential election, Donald Trump said he wanted a bigger coronavirus stimulus package than his own negotiators were offering, and that China would end up footing the bill. Speaking to Stuart Varney on Fox Business on October 15, he argued that American workers had not caused the crisis and that "China will pay us back in one form or another."
No such payment ever happened. The relief bill that eventually passed in December 2020 was funded the usual way, through federal borrowing. Here is what Trump said, what the stimulus fight was about, and why the "make China pay" idea did not work out.
What Trump said in the interview
At the time, the White House had put a $1.8 trillion offer on the table in talks with House Speaker Nancy Pelosi, whose Democrats had passed a $2.2 trillion package. Asked about the gap, Trump said he was willing to go higher than his own side's figure. In his view, the money would come back to the United States, because the pandemic had come from China and Beijing would be made to compensate.
Varney pressed him on how exactly that would work. Trump did not give a mechanism. "There's a lot of ways and I'll figure every one of them out," he said, adding that he already had a plan and pointing to the billions his administration had collected from China over the previous two years, a reference to tariffs.
He also attacked Pelosi's proposal, saying she wanted "all sorts of goodies," including money to bail out Democratic-run states and cities. The message was mixed: he supported a large stimulus in principle, but objected to the terms being set by the opposing party.
What a stimulus package is, and why one was on the table
A fiscal stimulus is government spending or tax relief designed to keep money moving through the economy during a downturn. In 2020 the aim was to support households, businesses and hospitals while lockdowns and job losses hit hard.
Congress had already passed the CARES Act in March 2020, with direct payments of up to $1,200 per adult, expanded unemployment benefits and loans for small businesses. By the autumn many of those programmes had run out, and both parties agreed in principle that more help was needed. They disagreed on the size, on aid to state and local governments, and on liability protections for employers.
The negotiations stalled before the election. After it, Congress passed the Consolidated Appropriations Act, 2021, which Trump signed on December 27, 2020. Its pandemic relief portion came to roughly $900 billion and included $600 payments for most adults. Trump had briefly held out for $2,000 payments before signing.
Could China really have been made to pay?
The short answer is no, not in any direct way. There is no legal procedure by which one country can bill another for a pandemic, and China would never have agreed to it voluntarily. A few routes were floated by politicians at the time, each with obvious problems:
- Tariffs: Trump often said China paid his tariffs. In practice tariffs are paid by the importer, usually an American company, and much of the cost is passed on to American consumers. Economists across the spectrum rejected the idea that tariff revenue amounted to China paying the US.
- Cancelling US debt held by China: Defaulting on Treasury bonds would damage confidence in the dollar and raise US borrowing costs, hurting Americans far more than Beijing.
- Lawsuits: A few US states and private groups tried suing China over Covid-19, but foreign governments are generally protected by sovereign immunity in US courts. Missouri reportedly won a default judgment in 2025 after China did not take part, yet collecting money from a foreign state is a separate and much harder problem.
The trade relationship itself had been tense since January 2018, when the first major US tariffs on Chinese goods took effect. The Phase One trade deal signed in January 2020 committed China to buy an extra $200 billion of American goods and services over two years; by the end of 2020 only around 58% of the US export target had been met.
Echoes of "Mexico will pay for the wall"
Many commentators compared the pledge with Trump's 2016 campaign promise that Mexico would pay for a border wall. Mexico never did; the barrier work carried out during his term was funded by US taxpayers, including money moved from the Pentagon budget.
The comparison was a fair one in structure: in both cases a large domestic cost was presented as a bill that a foreign government would cover, without a workable way to collect it. Critics also pointed to the inconsistency of attacking China while Trump family businesses had used Chinese manufacturers; Ivanka Trump's clothing brand, for example, sourced products from factories in China before it closed in 2018.
The election backdrop
The interview took place as early voting was under way and national polls showed Trump behind the Democratic nominee, Joe Biden. Promising a larger stimulus while blaming China allowed him to appear generous to voters and tough on Beijing at the same time, two themes his campaign returned to often.
Biden won the November 3 election. A further relief package, the $1.9 trillion American Rescue Plan, was signed by Biden in March 2021. Like the earlier packages, it was financed through US government borrowing, not by any foreign payment.
What to take from this episode
Political promises that another country will pay for a domestic programme are worth treating with caution. Useful questions to ask whenever one comes up:
- Is there a named legal or financial mechanism, or only a general assurance?
- Who actually writes the cheque at the point of payment, for example the importer in the case of a tariff?
- Has the other government agreed to anything?
In the case of the 2020 stimulus, all three answers pointed the same way: the money came from Washington, and China paid nothing toward it.
Sources: Fox Business interview, October 15, 2020; Consolidated Appropriations Act, 2021 (Wikipedia); China–United States trade war (Wikipedia); Mexico–United States border wall (Wikipedia).
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