WASHINGTON, DC – MARCH 20: House Speaker Mike Johnson (R-LA) speaks during a press conference … [+]
There is uncertainty in Washington about whether Congress will address President-elect Donald Trump’s ambitious policy agenda in a single or two bills. But lawmakers must confront a much bigger query: How will Trump navigate between Republicans whose top priority is shrinking the federal government and people who quietly worry in regards to the political consequences of cutting popular programs?
The dilemma: While Republican voters conceptually favor smaller government, they often support specific programs. For example a Pew Research survey finds that 79% of Trump supporters desire a smaller government that gives fewer services. But two-thirds of all voters and as many as 40% of Republicans or Republican supporters imagine the federal government should provide health take care of all.
One bill or two?
At the moment, this conflict revolves across the one-or-two tactical decision. And Trump’s own ambivalence illustrates the growing problem.
Trump said on his Truth Social platform on January 5 that he wanted “a powerful bill.” This would extend the Tax Cuts and Jobs Act, establish tax-free suggestions, increase funding for border security and create unspecified incentives for fossil fuel production. One that House Speaker Mike Johnson (R-La.) wants on Trump’s desk by Memorial Day.
But In a radio interview with Hugh Hewitt the following day, Trump expressed more ambivalence. He said: “I’m in favor of a bill. I also want every part to be adopted. And you realize, there are some individuals who don’t necessarily agree with it. That’s why I’m open to it too. My preference is an enormous one: As I said, I would favor an enormous, beautiful bill, but… I’m open to either way so long as we get something passed as quickly as possible.
Whatever version they selected, Republicans would use that mysterious reconciliation process, This allows the Senate to pass a bill with just 50 votes as a substitute of the usually required 60.
House Republicans would also likely include a rise within the federal debt limit coupled with significant cuts in government spending that might be needed to finance not less than a few of those tax cuts. Simply extending the TCJA would do it Add greater than $4 trillion to the federal debt in the following decade.
A difficult task
A large fiscal package in the shape of 1 or two bills could be a tall order, not least due to deep intraparty divisions amongst Republicans over how much to chop spending. Some House Republicans are demanding drastic cuts as a non-negotiable price for his or her support for every 2025 budget package.
In December, they reluctantly swallowed a short lived federal government spending bill. But only after Johnson reportedly reached a side agreement Combine a $1.5 trillion future increase within the nation’s borrowing capability with a $2.5 trillion reduction in net mandatory spending. Johnson has since said the ultimate numbers are “still to be determined.”
Since Trump opposes cuts to mandatory programs like Social Security and requires paying interest on the debt, the targets would likely include safety net programs like Medicaid and SNAP Food Assistance (formerly Food Stamps).
These lawmakers, including House Ways and Means Committee Chairman Jason Smith (R-Mo.), are pushing for a comprehensive bill. But the more cautious Republican leadership within the Senate favors a fast victory on a separate border measure, acknowledging that the fight over tax and spending cuts could last most of 2025.
Pay for tax cuts
In fact, two powerful Republicans within the Senate are searching for ways to avoid linking tax cuts to deep cuts in government spending. Chairman of the Senate Finance Committee Mike Crapo (R-Idaho) says The TCJA extension requires no offset of tax increases or spending cuts in any respect, insisting that it merely expands current policies.
New Senate Majority Leader John Thune (RS.D.) says not less than among the cost of the TCJA could be funded by a “growth dividend,” although he added that it might also require “significant spending cuts, particularly in certain areas,” which he didn’t elaborate on.
Narrow majorities in Congress exacerbate this conflict. By the start of next 12 months, Republicans will only have a one-vote majority within the House of Representatives. The GOP has a narrow 53-47 majority within the Senate.
Will Trump cut spending?
Trump himself has never shown much enthusiasm for spending cuts, despite his campaign guarantees to eliminate the deficit and even the debt. In his first term Expenses increased from $3.8 trillion in fiscal 12 months 2016 to $6.5 trillion in fiscal 12 months 2020.
And thus far, Trump has offered only limited ideas for financing his ambitious agenda. He has promised some type of tariffs and the removal of green energy subsidies in 2022. which could fund a TCJA extension alone, but not the TCJA and its other priorities.
For now, Trump appears to be leaving the seek for spending cuts to Elon Musk and Vivek Ramaswamy and their unofficial Department of Government Efficiency (DOGE).
Given these complications, it should come as no surprise that Trump has been unwilling to commit firmly to legislative tactics. But whether it’s one bill or two, he’ll still must navigate treacherous budget waters while reconciling his party’s deep budget differences.
Getting Republicans to comply with trillions of dollars in tax cuts will take labor, but it’ll be doable. It might be much harder to achieve consensus on how they must be paid. And until Trump does so, the fate of the TCJA will remain uncertain, regardless of what number of bills it takes.
