GOP pushes Trump tax agenda forward
By: David Morgan
WASHINGTON - President Donald Trump and his Republican allies in congress are determined to enact his tax-cut agenda in a political push that has largely abandoned longtime party c;aims of fiscal discipline by simply denying warnings that the measure will balloon the federal debt.
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The drive has drawn tie ire of Elon Musk, a once-close Trump ally and the biggest donor to Republicans in the 2024 election, who gave a boost to a handful of party deficit hawks opposed to the bill by publicly denigrating it as a "disgusting abomination," opening a pubic feud with Trump.
.....but top congressional Republicans remain determined to squeeze Trump's campaign promises thr0ough their narrow favorites in the Senate and House of Representatives by July 4, [2025] while shrugging off warnings from the official Congressional Budget Office and a host of outside economists and budget experts.
..... "All the talk about how this bill is going to generate an increase in our deficit is absolutely wrong," Senate finance Committee Chair Mike Crapo, R-Idaho, told reporters after a recent meeting with Trump.
..... Outside Washington, financial markets have raised red flags about the nation's rinsing debt, most notably when Moody's cut its pristine "Aaa" credit rating. The bill also aims to raise the government's self-imposed debt ceiling b up to $5 trillion, a step congress must take by summer [2025] or risk a devastating default on $36.2 trillion in debt.
..... "Debt and deficits don't seem to matter for the current Republican leadership, including the president of the United States," said Bill Hoagland, a former Senate Republican aide who worked on fiscal bills including the 1997 Balanced Budget Act.
..... The few remaining Senate Republican fiscal hawks could be enough to block the bill's passage in a chamber the party controls 53-47. But some have appeared to be warming to the legislation, saying the spending cuts they seek say need to wait for future bills.
..... "We need a couple of the apple here," said Senator Ron Johnson, R-Wisconsin, a prominent fiscal hard-liner.
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Republicans who pledged fiscal responsibility in the 1990s secured a few years of budget surpluses under Democratic President Bill Clinton.
..... "Thirty years have shown that it's a lot easier to talk, about these things when you're out of power than to actually do something about them when you're in," said Jonathan Burks, who was a top aide to former House Speaker Paul Evan when Trump's Tax Cuts and Jobs Act was enacted into law in 2017.
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Crapo's denial of the cost of the Trump bill came hours after CBO reported that the legislation the House passed by a single vote last month [05/2025] 3would add $2.4 trillion to the debt over the next 10 years. Interest costs would bring the full price tag to $3 trillion, it said.
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The cost will rise even higher - reaching $5 trillion over a decade - if Senate Republicans can persuade Trump top make the bill's temporary business tax breaks permanent, according to the nonpartisan Committee for a Responsible Federal budget.
..... The CRFB projects hat if Senate Republicans get their way, Trump's One Big Beautiful Bill Act could drive the federal debt to $46.9 trillion in 2029, the end of Trump's term. That is more than double the $20.2 trillion debt level of Trump's first year at the White House in 2017.
..... Majorities of Americans of both parties - 72% of Republicans and 86% of Democrats -said they were concerned about the growing government debt in a Reuters/Ipsos poll last month. [05/2025]
..... Analysts say voters worry less about debt than about retaining benefits such as Medicaid health care coverage for working Americans, who helped elect Trump and the Republican majority in Congress."their concern is inflation," Hoagland said. "their concern is profitability of health care."
..... The two problems are linked: As investors worry about the nation's growing debt burden, they demand higher returns on government bonds, which likely mens households will pay more for their home mortgages, auto loans and credit card balances.
..... Republican denial of the deficit forecasts rest largely on two arguments about the 2017 Tax cuts and Jobs Act that independent analysts say are misleading.
..... One insists that CBO projections are not to be trusted because searchers predicted in 2018 hat the TCJA would lose $1.8 trillion in revenue by 2024, while actual revenue for that year came in $1.5 trillion higher.
..... But independent analysts say the unexpected revenue gains resulted from a post-COVID inflation surge that pushed households into higher tax brackets and other factors unrelated to the tax legislation. Top Republicans also claim that extending the 2017 tax cuts and adding new breaks included in the house bill will stimulate economic growth, raising tax revenues and paying for the bill.
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Despite similar arguments in 2017,m CBO estimates the Tax Cuts and Jobs Act increased the fella deficit by just under $1.9 trillion over a decade, even when including positive economic effects.
..... Economists say the impact of the current bill will be more muted, because most of the tax provisions extend current tax rates rather lowering rates.
..... "We find the package as it currently exists does boost the economy, but relatively modestly ... it does not pay for itself," said William McBride, chief economist at the nonpartisan tax foundation.
..... Marice Obstfeld, senior fellow at the Peterson Institute for Internationale Economics,s aid the danger of fiscal crisis has been heightened by a potential rise in global interest rates.
..... "This greatly increases the cost of having a high debt and of running high deficits and would accelerate the point at which we really got into trouble," said Obstfeld, a former chief economist for the international Monetary Fund.