On June 4, the nonpartisan Congressional Budget Office (CBO) released a revised estimate regarding the financial implications of President Donald Trump’s tax-cut and spending bill. The new assessment indicates that the legislation will contribute approximately $2.4 trillion to the nation's existing $36.2 trillion in liabilities. This significant adjustment comes on the heels of criticism from notable figures, including Trump ally Elon Musk, who recently labeled the bill a "disgusting abomination."
The CBO's updated estimate marks a decrease from an earlier projection, which anticipated that the Republican-led bill, passed on May 22 without any Democratic support, would add around $3.8 trillion to Washington's debt over the next decade. This measure, now pending action in the Senate, aims to extend Trump’s 2017 tax cut law while implementing substantial spending cuts, particularly targeting healthcare programs for low-income individuals.
This latest CBO estimate reflects adjustments made late in the legislative process, as Republican leaders navigated the bill toward passage. In response to Musk's criticisms, both the White House and top congressional Republicans attempted to downplay his concerns. Musk, who had joined Trump's team with ambitious promises of reducing federal spending by $2 trillion, left last week after achieving only a fraction of that goal.
Republican Senate Majority Leader John Thune addressed the media regarding Musk's comments, stating, “We obviously respect everything that Elon did with DOGE. On this particular issue, we have a difference of opinion.” This remark underscores the division within the party as they prepare to tackle the upcoming legislative challenges.
The updated CBO analysis is poised to assist the Republican-controlled Senate as it works on crafting its own version of the legislation in the coming weeks. With a slim 53-47 Senate majority, various factions within the party are advocating for modifications to the House-passed bill. Some lawmakers are pushing to reduce the more than $700 billion in savings proposed for Medicaid or to eliminate tax cuts that specifically benefit those earning overtime pay, tipped wages, or income from Social Security retirement payments.
As the Senate deliberates, the implications of the updated CBO estimate will likely influence key decisions regarding tax policy and government spending priorities, setting the stage for further discussions on fiscal responsibility within the Republican Party.
