Eleven thoughts on a really shitty House budget

War on the poor, a death-knell for American nuclear, over $6 trillion in extra debt, and more!

In keeping with my general view that the boring, “normal” aspects of Trump-era governance are under discussed, I wanted to make sure that Slow Boring isn’t sleeping on House Republicans finally rolling out actual legislative text about their reconciliation mega-bill.

There is a ton happening in this legislation — it’s such a mishmash that their acronym for it is BBB, or Big Beautiful Bill — but the tl;dr is that it stinks. Here’s why:

1. The “official score” of the Ways & Means Committee draft says that it will add $3.8 trillion to national debt, but that goes up to $4.6 trillion if you include the cost of higher interest rates. The Committee for a Responsible Federal Budget says that this relies on phase-out gimmicks and the true cost of making all this stuff permanent is $5.3 trillion, which rises to $6.2 trillion when you include interest rate costs.

2. One of the most profound things I ever heard about politics from an old hand was “all numbers that end in ‘illion’ sound the same to normal people,” so I want to emphasize that we are talking about $6,200,000,000,000 here, which is a very large number.

3. Right now, 3.7 percent of GDP is dedicated to paying interest on the national debt. That’s not exactly an immediate crisis, but policy makers should be trying to make that number go down rather than up.

4. Medicaid cuts contained in the bill will cause 8.6 million people to lose their health insurance, and another 5.1 million will lose coverage because Republicans are planning to let premium support tax credits expire.

5. The bill contains an expansion of the Child Tax Credit that costs $229.5 billion but is structured so as to provide no benefits for low-income families — including low-income families with working parents and earned income.

6. While members of the top 10 percent of the income distribution will see a 3 percent boost to their after tax earnings, the bottom 20 percent ends up paying higher taxes, because the cost of Trump’s tariffs is larger than the paltry benefits they get from the tax bill.

7. That’s not counting the cost of losing Medicaid benefits, the cost of higher interest rates on car payments because of the debt load, or the cost of large cuts to nutrition assistance.

8. Everyone expected the legislation to substantially repeal the Inflation Reduction Act’s spending on various decarbonization initiatives. And, indeed, money for electric cars is gone. Money to subsidize solar and wind production is gone. But they went further than expected and are also offering “a deathknell for advanced nuclear commercialization” and advanced geothermal.

9. I’m not even sure why they’re doing this, but they are killing off the Energy Department’s ability to use the Strategic Petroleum Reserve to stabilize oil prices. It took a while for the Biden administration to get to yes on this, but they eventually did and it worked and Republicans want to stop.

10. One of the big ways Medicaid cuts are enacted in this legislation is through stringent work requirements with big bureaucratic hurdles. Note that the reason this scores as saving money is that studies indicate that Medicaid work requirements do not induce additional work, people simply end up dropped from the rolls. Mike Johnson keeps characterizing this as a question of “able-bodied young men” getting a swift kick in the ass. But you know and I know and Mike Johnson knows that able-bodied young men don’t go to the doctor. The monetary savings here are coming, almost by definition, at the expense of the people who are consuming health care services.

11. The center-right Tax Foundation says the new debt incurred by this bill is so large that it will reduce the capital stock and therefore reduce wages and productivity. The upside, in their view, is that by increasing after tax earnings (even though wages and productivity fall), people will work longer hours, so GDP rises. On the other hand, most of the additional production ends up going toward making interest payments to foreigners.

As I said, this is really bad.

When you’re doing pure political position-taking, it’s smart to just say popular stuff. But when you’re actually governing, you need to try to do things that make sense.

But Republicans started with a core idea — fully extend the Tax Cut and Jobs Act — that costs a lot of money. And rather than acknowledge that the 2025 macroeconomic situation is different from 2017, and that means it’s hard to do TCJA extension without difficult tradeoffs, they added in a bunch of expensive, gimmicky Trump campaign promises. Then, they wanted to offset the cost of this extremely expensive commitment while minimizing political blowback. So they came up with a mix of just not offsetting it ($3.8 trillion), using gimmicks and not fully counting correctly (an extra $2.4 trillion), and a vicious attack on programs for poor people.

DOGE was a total bust at identifying fraud, Trump is increasing payments to Medicare Advantage ripoffs, and there’s just zero interest in a good-faith effort to wrestle with fiscal problems.

Some provisions of this legislation (like the EV rollback or limiting Medicaid provider taxes) I would find defensible in the context of a package to reduce the budget deficit. But to partially offset the cost of a regressive tax bill that blows a multi-trillion dollar hole in the deficit, while doing absolutely nothing to address the cost of population aging? It stinks! As I’ve said before, lots of right-of-center people have noticed that Trump is sloppy and ignorant when it comes to trade policy, but they should wake up to the fact that it’s not just trade.