Supported by Republicans Tax and spending bill This is now moving forward at home, getting a realistic examination from Wall Street. This is because the proposed tax exemptions are expected to outperform any savings in the draft law, which may lead to the escalation of American debts and the worsening financial expectations, according to economists and politicians.
If the bill advances forward without major changes, the United States may find debt levels that are escalating to finance tax cuts, according to many analyzes. Over the course of the next decade, the Republican Party bill may cost 3.8 trillion USD, according to a report Earlier this month by the Joint Taxes Committee, which studied the impact of tax measures against spending discounts.
These risks are Qaqa Wall Street. Moody classification on Friday The nation’s debts reducedHe pointed to the possibility of the new bill to add $ 4 trillion to the Federal Basic Deficiency, which excludes interest payments, over the next decade.
The bill also faces critics within the Republican Party, where it says freedom of the Freedom Council on social media on social media mail On Sunday, the draft law “failed to honor our promise in fact to correct the course of spending to the federal government and leads our nation towards a balanced budget.”
Anxiety, according to the economists and policy experts in Wall Street, is that adding billions of debts to the American Professor’s book can ultimately pressure federal spending because the nation may likely face the payments of higher benefits. This, in turn, may make it difficult to finance programs such as social security, which already faces a Financial withdrawal Children also flourish PensionOr to invest in initiatives such as infrastructure that can stimulate economic growth.
“It is time for policy makers to stop temporarily, return to the drawing board and put a plan that actually takes steps towards our nation’s place in a sustainable financial path,” Maya McGoynas, Chairman of the Committee for a responsible federal budget, said in an email.
“Our federal interest payments are escalating, already exceeding what we spend annually on defense or medical care,” she added.
The Trump administration said it does not agree to both Modi analysis and expectations that legislation could expand the nation’s deficit, which is the gap between federal spending and revenues.
“This is a draft law that does not add to the deficit,” White House spokeswoman Caroline Levit said on Monday at a press conference. “In fact, according to the Economic Consultants Council, there are 1.6 trillion dollars in this law – this is the biggest saving for any legislation that Capitol Hill passed in the history of our nation.”
Savings
At the heart of the proposed Republican Party’s bill is President Trump Renovation The 2017 tax cuts law and its functions, which introduced less tax cuts to many Americans. Since these rulings are scheduled to end at the end of 2025, about 6 out of every 10 will face tax increase notes in 2026 without extending the law, According to For an analysis of the non -party tax institution.
The Economic Advisors, a White House agency that advises the president to economic issues, He said In May, the new draft law is studying “4 trillion dollars taxes” by expanding TCJA provisions.
The renewal of cuts in the law alone will cost $ 2.2 trillion during the next decade, and the joint committee on taxes, which holds the impact of Congress policy. The group’s analysis found that the Republican Party’s draft law also includes other new tax exemptions that will add to the costs of the long -term bill.
For example, the draft law proposal to provide taxpayers with more Significant standard discount The joint committee found that it leads to $ 1.3 trillion of incoming revenues over the next decade. His analysis discovers that the abolition of taxes on the additional work wages for workers, in addition to giving a greater discount to the elderly citizens, will cost an additional 234 billion dollars during the same period.
The draft law includes spending discounts, but they are not large enough to compensate for tax exemptions, as well as many recent analyzes. The Policy Policy Center is not partisan estimatedIn the May 14 analysis that the tax cuts will cost $ 7.7 trillion over the next decade, while spending discounts will undermine $ 3.9 trillion during the same period. The result is a $ 3.8 trillion gap.
This is the account that prompted Moody’s to reduce its classification on the debts of the United States, from its highest classification from AAA to AA1. In its evaluation, the credit classification agency noted that the American deficit has risen to the top, as previous departments and the Congress failed to agree on the measures of the opposite direction. “
“Over the course of the next decade, we expect a greater deficit as spending in spending has increased while government revenues are still widely flat,” Moody’s said on Friday when the main rating agency has become the third main rating in the country’s credit rating. “In turn, the ongoing financial deficit will push the government debts and the burden of benefits up.”
He added, “It is likely that the financial performance of the United States is likely to deteriorate for its past and compare it to other high -ranking dictates.”
The Trump administration says that the proposed tax bill will stimulate economic growth by reducing taxes on consumers and companies. In an interview on Monday with Fox Business, the director of the National Economic Council, Kevin Haysit, said that the economy “will continue to take off as soon as these policies are already present, as soon as the tax cuts are already passed.”
Who wins and loses
The Republican Party tax bill remains in a state of flow and is likely to change while it is running the wind through the house.
Parliament Speaker Mike Johnson admitted that there are still details for “Iron Out”, where conservative Republicans are seeking to entertain quickly Work requirements For physical participants in Medicaid. These rules will take place in 2029 under the draft law that was approved last week through the Roads and Melage Committee. Some Republicans in the House of Representatives also want to end tax exemptions more quickly for green energy projects that are used at the country level.
If the draft law passes this week, it will move to the Senate, as Republicans also look to changes.
Democrats have criticized the discounts that Republicans propose to medical stamps and food stamps to compensate for the costs of tax exemptions, noting that the discounts in social security network programs come because many wealthy taxpayers will get a major tax break.
“The draft spending law is terrible, and I think that the American people know this. But there is a problem when this balance comes on the back of working men and women. This is what happens here.”
It will end with less American income to pay more under the proposed Republican Party bill, according to May 19. analysis From the Penn Wharton budget model, the Pennsylvania University group that studies the financial impact of public policies. Even including savings from tax cuts, 20 % of 20 %, who get up to $ 17,000 per year, will get $ 1035 in 2026 after discounts are taken in Medicaid and other programs.
“[H]The most affected Osholds suffer from discounts in Medicaid and Snap-those in the five-income-largest income-the largest losses under this bill, with an average of 28,000 dollars in a lifelong value for working age residents, “The Penn Wharton budget model has been calculated.
He contributed to this report.
