The Senate has passed a massive tax cut and spending bill that could add trillions to the federal debt over the next decade. This legislation extends many tax cuts from 2017 while also cutting spending on programs like Medicaid and food assistance.
Different forecasters estimate the bill’s impact on the national debt. The Yale Budget Lab projects an addition of $3 trillion, while the Congressional Budget Office (CBO) estimates it at $3.4 trillion. Some experts, like those from the Committee for a Responsible Federal Budget, suggest it could exceed $4 trillion. Regardless of the exact number, there is a consensus that this bill will worsen the government’s financial situation.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, criticized the bill, saying it shows a "blatant disregard" for the nation’s fiscal health. She pointed out that lawmakers, who have often expressed concern about the country’s debt, are now voting to add even more to it.
The bill not only extends previous tax cuts but also introduces new tax breaks, which will lower government revenue. It increases spending on defense and immigration enforcement while making cuts to social programs that only partially offset the bill’s overall cost.
Economically, the bill is not expected to provide significant growth. The CBO has yet to analyze the Senate version, but a previous House version showed only modest economic benefits, which were outweighed by increased interest payments on the debt.
Lower-income individuals are likely to feel the brunt of these changes. According to CBO forecasts, those earning under $55,000 annually would end up losing out, as any tax savings would be offset by reduced government benefits. In contrast, middle-income taxpayers might see savings of between $500 and $1,000 a year, while the wealthiest 10% could gain around $12,000.
The bill now heads back to the House, which had previously passed a different version earlier this year. As the debate continues, the implications for the federal budget and everyday Americans remain significant.