The Republican-controlled US House of Representatives has narrowly passed a sweeping tax and spending bill that aims to implement much of President Donald Trump’s policy agenda. This significant legislative move occurred on Thursday, and it is projected to add trillions of dollars to the national debt. The bill fulfills many of Trump’s populist campaign promises, including new tax breaks on tips and car loans, as well as increased funding for the military and border enforcement.
According to the nonpartisan Congressional Budget Office (CBO), the legislation is expected to add approximately $3.8 trillion to the federal government’s existing $36.2 trillion debt over the next decade. This bill, which Trump referred to as the “one big, beautiful bill,” passed with a narrow margin of 215-214. Notably, all Democrats in the chamber and two Republicans voted against the bill, while a third Republican chose to vote “present.”
For the bill to become law, it must also secure approval from the Republican-controlled Senate. The vote followed a marathon session that kept lawmakers debating the bill through two consecutive nights. The extensive 1,000-page legislation seeks to extend corporate and individual tax cuts enacted in 2017 during Trump’s first term, eliminate many green-energy incentives introduced by former Democratic President Joe Biden, and tighten eligibility criteria for health and food assistance programs aimed at low-income individuals.
Additionally, the bill allocates funds for Trump’s stringent immigration policies, which include adding tens of thousands of border guards and enabling the deportation of up to 1 million individuals each year. This passage comes amid rising concerns over the US debt, which has soared to 124% of GDP. Such fiscal anxiety led to a downgrade of the US’s top-tier credit rating by Moody’s last week.
The US government has experienced budget deficits every year this century, with both Republican and Democratic administrations failing to align spending with revenue. Interest payments accounted for one out of every eight dollars spent by the US government last year, surpassing military expenditures, according to the CBO. This figure is projected to rise to one out of every six dollars over the next decade, driven by an aging population that will increase health and pension costs, regardless of whether Trump’s budget bill is factored in.
Investors are becoming increasingly wary of the US’s fiscal situation, as well as Trump’s unpredictable tariff policies, leading to a sell-off of the dollar and other US assets that are crucial to the global financial system. Representative Thomas Massie of Kentucky, one of the two Republicans who voted against the bill, remarked, “We’re not rearranging deck chairs on the Titanic tonight. We’re putting coal in the boiler and setting a course for the iceberg.”
Supporters of the bill argue that its failure would result in tax increases for many American families. They also plan to leverage this bill to raise the federal government’s debt ceiling, a necessary step Congress must take by summer to avoid potential default. Representative Stephanie Bice, a Republican from Oklahoma, emphasized the importance of the bill, stating, “The success of the country depends on it.”
With a slender majority of 220-212, House Speaker Mike Johnson could afford to lose only a few votes from his party. Republicans on the right wing of the party advocated for deeper spending cuts to mitigate the budget impact, but faced opposition from centrists concerned about the effects on the 71 million low-income Americans relying on the Medicaid health program. To address these concerns, Johnson modified work requirements for Medicaid recipients, moving the implementation date to the end of 2026, which could result in millions being removed from the program, as indicated by the CBO.
Democrats have condemned the bill, asserting that it disproportionately favors the wealthy while cutting essential benefits for working Americans. The CBO analysis revealed that the bill would decrease income for the poorest 10% of US households while increasing income for the top 10%. Democratic Representative Jim McGovern of Massachusetts criticized the legislation, calling it “a tax scam designed to steal from you, the American people, and give to Trump’s millionaire and billionaire friends.”
The Senate, where Republicans maintain a 53-47 majority, is not expected to address the bill until early June. Key Senate Republicans have indicated that significant modifications to the bill may be made before it is passed. As the legislative process unfolds, the future of this major tax and spending package remains uncertain.
