Congress Passes Trump Budget Bill Increasing Debt by $3.4 Trillion

On the eve of July 4th, the U.S. Congress passed a landmark budget bill, marking a significant shift in the nation's economic priorities. Driven by Donald Trump, this legislation features substantial tax cuts, reductions in social programs, and a notable increase in military spending, all of which are expected to significantly raise the public debt. The bill was narrowly approved by a vote of 218 to 214, despite internal Republican divisions and unanimous opposition from Democrats. This legislative victory is seen as a strategic turning point in the post-Biden era, reshaping the political landscape and reigniting ideological tensions in Washington.

The budget bill, which includes major tax cuts, the elimination of the tipping tax, and increased military expenditures, was officially approved by the House of Representatives on July 3rd. This vote followed a challenging Senate approval two days earlier. The White House celebrated the passage, describing it as a significant victory for the Trump administration. The bill's approval was marked by high political tension, with some Republican lawmakers chanting "USA, USA, USA!" after the vote, despite internal fractures within the party.

To secure the necessary votes, the Trump administration employed various political maneuvers. These included personal interventions by Trump, nighttime calls to persuade reluctant lawmakers, and behind-the-scenes negotiations led by the Speaker of the House, Mike Johnson, with direct support from the White House. The vote, initially scheduled for Wednesday, was delayed due to a nine-hour speech by Hakeem Jeffries, the Democratic leader in the House. Ultimately, only two Republicans voted against the bill, maintaining a fragile majority of eight seats.

The content of the budget bill has sparked significant controversy. The legislation extends massive tax credits from Trump's first term, eliminates taxation on tips, and increases military spending and funding for immigration control. However, these measures come with substantial cuts to social programs, including Medicaid and the SNAP program, which provide vital support to millions of low-income Americans. The Congressional Budget Office estimates that the bill will increase the public debt by more than $3.4 trillion by 2034.

Critics, including Democratic lawmakers and some business leaders, have expressed concern over the bill's impact on low-income households. Hakeem Jeffries described the bill as a "repugnant monstrosity that will cause suffering to ordinary Americans," while Gavin Newsom, the governor of California, stated that "17 million people have just lost their health insurance." Joe Biden criticized the bill as "not only irresponsible but cruel," highlighting the significant tax cuts for the wealthiest Americans. The bill's potential to stimulate the economy through tax reduction is countered by its human and financial costs, which could exacerbate political polarization ahead of upcoming elections.

This historic budget legislation, aligned with Trump's vision of a strong and debt-free America through economic growth, is expected to have contrasting effects. While financial markets and economic circles await the quantified impact, the social and political tensions generated by the bill are already evident. The reform could become a defining feature of the new Trump era but also a major rallying point for the opposition.