I & I Editorial BoardIt is axiomatic that both Republicans and Democrats will exaggerate the size of any spending cut proposal, for the simple reason that it appeals to their partisan supporters.
The “One Big, Beautiful Bill” is no exception. The numbers tell the tale. There are no spending cuts, at least, not in the way every household on a budget would count as a cut.
That’s not what the headlines scream. Instead, it’s all things such as this from the left:
- “Deepest Cut in History”
- “Would Take Food Assistance Away From Millions of Low-Income Families”
- “Devastating Our Healthcare System”
Meanwhile, the White House is telling us that “There’s $1.6 trillion worth of savings in this bill. That’s the largest savings for any legislation that has ever passed Capitol Hill in our nation’s history.”
We’re told that “deficit hawks in the Senate like Rand Paul and Ron Johnson are drawing a red line – pushing for deeper cuts than those in the bill the House sent to them.”
Which also implies that there are spending cuts.
Not only does the One Big, Beautiful Bill (OBBB) not cut spending, it barely makes a dent in projected increases in federal spending. (See the chart below.)
Under the House bill, federal spending will climb an average of 4.4% a year over the next decade. Or about twice the rate of inflation.
By 2034, the federal budget will be $3.3 trillion bigger than it is today.
That year, federal spending as a share of GDP will be 24% under the One Big, Beautiful Bill, up from 23% today and the same as it would be if nothing were done on the spending side.
The White House says that the One Big, Beautiful Bill makes permanent fixes to Medicaid and food stamps and will “kick illegal immigrants off the taxpayer-funded rolls, cut government funding for sex changes, and restore integrity in program spending.” That’s all well and good, except the Medicaid “cuts” barely register in the grand scheme of things (as the chart above shows).
The Trump administration says that “more cuts are on the way,” including a “rescissions” bill that would cut a few billion dollars of wasteful spending identified by DOGE.
But if you want to see just how little appetite there is in Washington for spending cuts, look at the chart below. It shows where total federal spending was headed before the massive COVID-19 spending splurge, and where it’s now headed after COVID.
You’d think that spending would have returned to its previous trajectory once that crisis was over. But that’s not how Washington works.
Instead, as the chart shows, most of those massive spending increases got baked into the budget “baseline.” Any future spending increases or “cuts” are then measured against that new, higher spending trajectory.
If lawmakers were even remotely serious about getting federal spending under control, they’d at least get it back down to that pre-COVID line. (That would produce almost $12 trillion in savings over the next decade, compared with the OBBB’s $1.6 trillion.) Even doing that would still allow spending to increase year after year.
This is not to say that Congress should scrap the One Big, Beautiful Bill. Extending Trump’s 2017 tax cuts makes almost anything else in the legislation worth it. Because if that doesn’t happen, everyone’s taxes will increase, and the economy will certainly collapse.
But, for the love of God, please stop pretending like this bill cuts spending.
— Written by the I&I Editorial Board
Incomprehensible. Suicidal.
Sadly, one of the biggest eaters of money if the Defense department, which Congress funds through annual appropriations bills (in theory). Hegseth still hasn’t done his DOGE cuts but he’s reviewing.
The defense budget has gotten out of control. Just look at the F-35, a $1.7 trillion project that’s gotten too big to fail. Its forebear was the F-22, another boondoggle. The military is riddled with this crap and now they want to focus on drone warfare. The Military Industrial Complex is indeed alive and well.
The defense dept and anyone with half a brain saw the problems with drones over a decade ago. We’ve been using them in combat since Obama, who used one to kill an American citizen abroad (granted, he was a jihadist). Now they want a golden dome, another boondoggle for a country our size, that won’t ever stop drones. Look at what Ukraine accomplished with less than 200.
The military has also become a perpetual money-wasting machine set on autopilot. If we didn’t use or had diverted all that wasted money to programs that actually make a difference, the military wouldn’t need a penny (to be discontinued).
I have the same issues with Medicare/Medicaid, which have made wasting money a team sport. Same with SS, which wouldn’t be nearing insolvency if the govt had just put half our earnings into a stock index fund. It’s primarily used for long-term passive investing (like social security).
The stock market always keeps going up. Just ask any congressperson. I’d be a millionaire many times over long before I turned 65 if the govt didn’t put all our SS earnings into Treasury bonds (return: 2%). Look at the S&P index over the last 50 years. It always goes up. But politicians point to the crash of ’29 and say, “See, that could happen.” Except it can’t with the guardrails the government has put in place with new laws.
It’s time for America to have a wake-up call. We Are Broke.
Without the BBBILL The US will SPEND 3TRILLION more $. So… That is a CUT in spending.
The microbrain that wrote this piece can’t see due to his PERSPECTIVE. Pulling his head out will improve that.
Question for Barry, If I plan to borrow and spend $1,000 more next month than I did this month, and then I change my mind and decide to borrow and spend only $900 more, would you really call that a $100 cut in spending? I’d call that a $900 increase in spending with money I don’t have. I think most of us microbrains would.