From the Desk of LNC Secretary Evan McMahon

John ,

Tariffs are often sold to the public as a patriotic tool — a way to punish foreign competitors and protect American industry.

But in practice, tariffs function as something much simpler: taxes.

Taxes paid by Americans.

And now, thanks to a bizarre financial scheme tied to Commerce Secretary Howard Lutnick’s family, those taxes may also function as a revenue stream for politically connected insiders.

In 2025, President Donald Trump imposed sweeping massive new tariffs across multiple industries. Businesses importing goods into the United States were required to pay those tariffs up front to the federal government.

Recently, the U.S. Supreme Court struck those tariffs down.

Normally, when the government collects money under an unlawful policy, the next step is simple: refund the money.

But Washington rarely does things the simple way.

Instead of promptly returning the money to the businesses that paid it, the administration has dragged its feet on issuing refunds. And that delay has opened the door to a remarkable opportunity — not for taxpayers or businesses, but for investors.

Specifically, investors connected to the family of Commerce Secretary Howard Lutnick.

According to reporting now under investigation by Congress, Lutnick’s son has been involved in financial deals buying the rights to tariff refund claims from businesses that originally paid the tariffs. These buyers purchase the claims at a discount and then collect the full refund from the government later — along with interest.

It’s essentially the financial equivalent of buying someone’s winning lottery ticket before they can cash it.

Except in this case, the “lottery” is taxpayer money.
The longer the government delays issuing refunds, the more interest accrues on those payments. And the more interest accrues, the more profit investors stand to make.

Which means the administration’s slow-walking of refunds goes beyond bureaucratic incompetence.

It creates profit for the people positioned to collect the interest.

Taxpayers, meanwhile, get the bill.

According to estimates from the Cato Institute, these delayed refunds could cost taxpayers tens of millions of dollars — roughly $20 million per day in additional interest payments.

Think about that for a moment.

The government imposed tariffs that were ultimately ruled unlawful. While those tariffs were still in place, politically connected investors purchased the rights to potential refund claims from businesses that had paid them. Now that the tariffs have been struck down, those investors stand to collect the refunds — along with the interest taxpayers will be forced to pay while the government delays issuing them.

A private company operating this way would likely be facing fraud investigations and regulatory scrutiny.

But when it happens in Washington, it’s just another Tuesday.

This isn’t about Republicans versus Democrats. It’s about the structural incentives of power.

Tariffs themselves are already one of the most economically destructive forms of taxation. They raise prices for consumers, disrupt supply chains, and invite retaliation from other countries.

But now we’re seeing something even worse. Tariffs becoming a profit center for insiders with the political connections to monetize government policy.

If a Commerce Secretary’s family stands to benefit financially from how the government manages tariff refunds, the conflict of interest should be obvious.

At minimum, there should be a full public open door congressional investigation into these dealings.

More importantly, the government should stop playing games with other people’s money and immediately refund every dollar collected under the unconstitutional tariffs.

Taxpayers should not be forced to subsidize interest payments that enrich politically connected investors.

But the larger lesson here is one Libertarians have been pointing out for decades.

When government has the power to impose massive taxes, manipulate markets, and control billions of dollars in economic flows, someone will always find a way to profit from it.

And it’s almost never the people paying the bills.

In Liberty,

Evan McMahon
Secretary - Libertarian National Committee



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