House GOP pushes ahead on deficit-boosting tax bill

House Speaker Mike Johnson battled to secure the passage of President Trump's so-called big, beautiful bill, attempting in a blitz of negotiating and arm-twisting to unite his fractious GOP caucus around the cornerstone of Trump's legislative agenda. The bill would lock in Trump's 2017 tax cuts, which are due to expire at year's end, while shrinking taxes on tips and overtime pay. It also allocates hundreds of billions of dollars toward immigration enforcement, the border wall, and defense. To offset tax cuts that would cost an estimated $3.8 trillion over a decade, the bill would cut federal funding for food stamps by $267 billion, scrap clean energy tax credits passed under former President Biden, and cut an estimated $625 billion from Medicaid, mainly by establishing work requirements. Republican hard-liners argued for steeper spending cuts opposed by GOP moderates, who also want a higher cap on the amount of state and local taxes residents can deduct from their federal taxes. Trump traveled to Capitol Hill to whip "grandstanders" into line, but as The Week went to press, Johnson—who needs all but three GOP votes—was still wrangling amid a marathon session. If it passes the House, the bill is expected to be changed substantially by the Senate.

As fiscal hawks decried the bill's cost, Moody's downgraded the nation's triple-A credit rating for the first time in more than a century, citing "large annual fiscal deficits" and the surging cost of servicing a national debt that has swelled to $36 trillion. The Republican bill would add an estimated $3.3 trillion to the debt over a decade, according to the Penn Wharton Budget Model; the Committee for a Responsible Federal Budget says the debt could reach 129% of the U.S. economy by 2034. "We are entering uncharted territory," said CRFB president Maya MacGuineas.

What the editorials said

"There is nothing beautiful" about a bill that strips health coverage from low-income Americans while "exploding the national debt," said the Austin American-Statesman. The Medicaid restrictions, which would require able-bodied recipients without children to work at least 80 hours a month, would leave an extra 8.6 million Americans uninsured, according to the nonpartisan Congressional Budget Office. Throw in tax cuts favoring the rich, and the bill would boost incomes for the richest 10% of Americans while lowering them for the bottom 10%, says the CBO. That's "a disastrous step backward."

Moody's has stated "the obvious," said The Wall Street Journal: Our fiscal path is "unsustainable." The real problem is spending, which neither party is willing to attack. "DOGE has cut around the edges," but Trump won't touch Medicare or Social Security, and too many Republicans "won't even fix Medicaid, which has soared since Obamacare expanded coverage to able-bodied young men."

What the columnists said

The timing of Moody's downgrade wasn't accidental, said Heather Long in The Washington Post. It "wanted to send a message" to Republicans who are about to make a dire situation worse. For a marker of "how scary" the debt is getting, consider this: In 2021, 9% of federal revenue went to paying interest on the debt. Last year, it was 18%. By 2035, debt service will swallow almost a third of revenue, Moody's estimates. As the walls close in, investors "are in 'sell America' mode," seeing unprecedented risk in U.S. assets.

While it ratchets up the debt, the bill would also slash nearly $1 trillion from "bedrock safety net programs," said Tami Luhby in CNN.com. That will hurt millions, including many of the vulnerable Americans "the GOP has promised repeatedly to protect," among them children, the disabled, and senior citizens. More than 71 million Americans are enrolled in Medicaid, and roughly 42 million receive food stamps. A great number are from rural areas that "overwhelmingly support" Trump, said Jamelle Bouie in The New York Times. Nearly half of rural children get health insurance through Medicaid, and 1 in 7 rural households uses food stamps.

"All in all, this is a terrible bill," said Dylan Matthews in Vox. But for Republicans, it's also "startlingly normal." For all the talk of a new, populist Republican Party and for all Trump has upended tradition and shattered norms, it seems the GOP remains in thrall to the principles that have defined it for decades: taking from the poor, giving to the rich, and showering money on defense. Politics under Trump may have "gotten extremely weird," but for the GOP, Trump's big, beautiful bill is business as usual.