The Republican-controlled U.S. Senate has officially approved President Donald Trump’s tax and spending bill, paving the way for a substantial package that will solidify many of his key priorities into law. However, this move comes with a hefty price tag, adding an estimated $3.3 trillion (€2.8 trillion) to the national debt.
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Next, the bill returns to the House of Representatives for its final nod of approval.
President Trump has been vocal in urging lawmakers to advance this legislation to his desk in time for the Independence Day celebrations on July 4th. As Trump aptly noted, “We’re going to come together and do great things for the American people.”
Despite the Republican majority being slim, they have crafted a careful approach to navigate the complexities of this 940-page bill.
Throughout this process, Republican unity has largely been maintained. In fact, only three of the Senate’s 53 Republicans voted against the package, resulting in a narrow passage of 51-50, with U.S. Vice President JD Vance casting the decisive vote.
The upcoming vote in the House, where Republicans hold a narrow 220-212 majority, is anticipated to be closely contested. The initial version of the bill barely passed in May, with just a two-vote margin, and several House Republicans have voiced their opposition to the Senate’s modifications. The Congressional Budget Office (CBO) suggests that the new Senate version will contribute an additional $800 billion to the national debt compared to its House counterpart.
The House Freedom Caucus, representing a faction of stiff-conservatives, is advocating for more stringent spending cuts than what the Senate has proposed. They expressed their concerns through social media, stating, “The Senate’s version adds $651 billion to the deficit—and that’s before interest costs, which nearly double the total. That’s not fiscal responsibility. It’s not what we agreed to.”
Moderate House Republicans, particularly those serving lower-income districts, have raised alarms regarding the significant cuts to Medicaid in the Senate’s proposal. Representative David Valadao of California emphasized during the weekend debate, “I will not support a final bill that eliminates vital funding streams our hospitals rely on.”
Despite these domestic challenges, House Republicans are likely to feel substantial pressure from President Trump in the coming days. The proposed “One Big Beautiful Bill Act” seeks to make permanent Trump’s 2017 business and personal income tax cuts, which are set to expire at the end of this year. This act also aims to introduce new tax breaks for tipped income, overtime, and seniors—commitments made during his 2024 campaign.
Moreover, the package allocates billions for Trump’s immigration enforcement initiatives while revoking many of the green energy incentives established by former President Joe Biden.
However, the proposed measures also tighten eligibility for essential programs like food assistance and health safety nets. Critics argue that this would inevitably reduce income for low-income Americans, compelling them to shoulder higher costs.
As the CBO estimates, the latest bill could add $3.3 trillion to the already staggering $36.2 trillion debt. Analysts highlight that this growing debt acts as a wealth transfer from younger generations to older Americans, stunting economic growth and inflating borrowing costs, thus limiting future government expenditure.
Additionally, the legislation plans to increase the nation’s borrowing limit by $5 trillion, averting a looming debt default this summer that could potentially disrupt global markets. However, some Republicans have rejected the CBO’s cost assessments, raising concerns among foreign investors about diversifying away from U.S. Treasuries as deficits rise.
The Republican party contends that this bill will support families and small businesses while establishing a more sustainable framework for benefit programs like Medicaid. While the main components of the bill are largely agreed upon, disagreements persist, especially regarding the funding structure for Medicaid and the calls for tax breaks for residents of high-tax states such as New York, New Jersey, and California.
Some members fear that budget cuts to Medicaid could lead to diminished services in rural communities, while others on the party’s right have proposed more drastic Medicare cuts to lessen budgetary pressure. Notably, Trump has publicly called out Republican dissenters on his Truth Social platform, leaving many reluctant to oppose him since his return to office in January.
Senator Thom Tillis from North Carolina, a notable Republican dissenting voice, announced on Sunday that he would not seek re-election next year, further highlighting the intensity of the current political climate.
Edited By Ali Musa
Axadle Times International – Monitoring.
