The High Stakes of Trump’s “One Big Beautiful Bill”

By IndraStra Business News Desk

The “One Big Beautiful Bill Act,” a sprawling 1,116-page legislative package championed by President Donald Trump, has ignited fierce debate in Washington, exposing deep fissures within the Republican Party and drawing sharp criticism from Democrats. This ambitious bill, which House Speaker Mike Johnson aims to pass by Memorial Day 2025, seeks to cement Trump’s 2024 campaign promises through sweeping tax cuts, stringent social program reforms, and robust border security measures. Yet, as it teeters on the edge of a House floor vote, the legislation faces resistance from both fiscal conservatives and moderates, while Democrats decry its potential to harm millions of vulnerable Americans. The bill’s fate will shape not only Trump’s second term but also the economic and social fabric of the nation for years to come.
At its core, the bill extends the 2017 tax cuts that defined Trump’s first term, delivering over $5 trillion in tax relief for individuals and businesses, though the net cost is estimated at $3.8 trillion after offsets. Key provisions include making permanent the individual income tax cuts, eliminating taxes on tips, overtime, and interest on certain auto loans, and boosting the standard deduction to $32,000 for joint filers. A temporary $500 increase in the child tax credit, bringing it to $2,500, and a $4,000 deduction for seniors earning up to $75,000 (or $150,000 for couples) are also included, though these expire by 2028. Small businesses benefit from a raised deduction of 23% on qualified business income, up from 20%. The estate tax exemption rises to $15 million, and a novel “MAGA” savings account offers $1,000 from the federal government for children born between 2024 and 2028, with families able to contribute $5,000 annually tax-free. However, Adam Michel of the Cato Institute warns, “It will just make tax paying more complicated and more uncertain when a lot of these things ultimately expire.”
The bill’s tax provisions are not without controversy. The state and local tax (SALT) deduction cap, raised from $10,000 to $30,000 for joint filers earning up to $400,000, has sparked pushback from Republicans in high-tax states like New York and California. Representatives like Nick LaLota demand a cap as high as $124,000 for couples, arguing the current proposal insufficiently supports their constituents. LaLota has even suggested letting the top income tax rate revert to 39.6% from 37% to fund a more generous SALT cap while protecting working families and addressing the deficit. Meanwhile, fiscal hawks like Rep. Chip Roy criticize the bill for adding to the $36 trillion national debt, with the Congressional Budget Office (CBO) estimating a $2.5 trillion deficit increase over a decade and a $4 trillion reduction in federal tax revenue by 2034. Roy’s blunt assessment, “We are writing checks we cannot cash, and our children are going to pay the price,” underscores the conservative demand for deeper spending cuts to offset the tax breaks.
To fund these tax cuts, the bill proposes significant reductions to social safety net programs, targeting Medicaid and the Supplemental Nutrition Assistance Program (SNAP). Medicaid faces nearly $800 billion in cuts, with new work requirements mandating 80 hours per month of work, education, or community service for able-bodied adults without dependents, effective January 2029. Eligibility verification would double to twice yearly, and applicants with homes valued over $1 million would be ineligible. The CBO projects these changes could strip 7.6 million people of health coverage, with additional losses from tweaks to the Affordable Care Act (ACA), such as a shortened open enrollment period. Liz Pancotti of the Groundwork Collective warns, “It’s taking folks like 11 to 12 weeks to find a new job. The worse the labour market gets, that number will tick up. If you’re unemployed for three months, you get kicked off Medicaid.” Democrats, like Rep. Morgan McGarvey, condemn the cuts as devastating, stating, “To pay for it, kids in Kentucky will go hungry, nursing homes and hospitals will close, and millions of Americans will be kicked off their health insurance.”
SNAP faces similarly stringent reforms. States would bear 5% of benefit costs starting in 2028 and 75% of administrative costs, a shift from the current federal funding model. Work requirements would expand to adults up to age 64, and exemptions for parents would apply only to those with children under 7, not 18. The CBO estimates 3 million people could lose SNAP access, exacerbating food insecurity as grocery costs remain 2% higher than last year. Pancotti highlights the strain on states, noting, “States are now going to be on the hook for billions of dollars in funding for these two vital programmes. They have a tough choice. One is, do they cut funding from others like K-12 education, roads, veteran services, etc, to cover this gap, or do they raise taxes so that they can raise more revenue to cover this gap.” Even some Republicans, like Senator Josh Hawley, call the Medicaid cuts “morally wrong and politically suicidal,” reflecting unease within the party.
The bill’s impact on tipped workers is particularly contentious. While it eliminates taxes on tips—a promise echoed by both Trump and Kamala Harris—Saru Jayaraman of One Fair Wage argues it offers little relief, as “two-thirds of tips workers don’t earn enough to pay federal income tax.” Meanwhile, 1.2 million tipped workers could lose Medicaid access, pushing them into medical debt or untreated health issues. The lack of a federal mandate to raise the $2.13 subminimum wage for tipped workers further limits the provision’s benefits, leaving many vulnerable.
Beyond fiscal policy, the bill advances Trump’s broader agenda. It allocates $46.5 billion for border wall construction, $4 billion to hire 3,000 Border Patrol agents and 5,000 customs officers, and $2.1 billion for bonuses, alongside funds for 10,000 Immigration and Customs Enforcement officers. A $1,000 asylum fee, rare globally, aims to deter migrants, while the plan targets 1 million annual deportations and 100,000 detentions. Critics note that a 2018 Stanford study found border walls reduce migration by only 0.6%, questioning the investment’s efficacy. Defense spending rises by $150 billion, including $25 billion for Trump’s “Golden Dome” missile defense shield, $34 billion for naval expansion, and $9 billion for servicemember quality of life. These priorities reflect Trump’s vision but add to the bill’s cost, fueling conservative objections.
The legislation also targets political foes and rewards allies. It eliminates a $200 tax on gun silencers, supported by the NRA but opposed by Giffords, which argues, “Silencers make it more difficult to recognize the sound of gunfire and locate the source of gunshots, impairing the ability of law enforcement to respond to active shooters.” Medicaid funds to Planned Parenthood would be cut, limiting access to cancer screenings and birth control, per Democrats. A provision allowing the Trump administration to revoke tax-exempt status from nonprofits deemed to support terrorism raises alarms. Jenna Ruddock of Free Press Action warns, “This measure’s real intent lurks behind its hyperbolic and unsubstantiated anti-terrorist rhetoric: It would allow the Treasury Department to explicitly target, harass and investigate thousands of U.S. organizations that make up civil society, including nonprofit newsrooms.” The bill also imposes a 14% to 21% tax on university endowments, targeting institutions like Harvard, which recently lost $2.65 billion in grants, and overhauls student loans by replacing existing plans with less generous options, yielding $330 billion in savings.
Environmental policy takes a hit, with the bill repealing clean energy tax credits, including $7,500 for new electric vehicles and $4,000 for used ones, a move that could jeopardize jobs at automakers like General Motors and Ford, which invested heavily in EV production. Increased leasing of public lands for drilling, mining, and logging, coupled with reduced royalty rates and sales of public lands in Nevada and Utah, reverses Biden-era climate efforts, drawing ire from environmentalists.
The bill’s path through Congress has been rocky. On May 16, five Republican fiscal hawks—Reps. Chip Roy, Ralph Norman, Josh Brecheen, Andrew Clyde, and Lloyd Smucker—joined Democrats to block it in the House Budget Committee, demanding immediate Medicaid work requirements and deeper green energy subsidy cuts. Roy declared, “This bill falls profoundly short.” After intense negotiations, a late-night vote on May 18 saw the bill advance 17-16, with the holdouts voting “present” after securing promises of earlier work requirements and reduced green energy subsidies. Norman noted, “We had some great changes, got a lot more work to do,” while Roy cautioned on X that the bill “does not yet meet the moment.” Speaker Johnson hailed the vote as “a big win tonight,” but acknowledged, “There’s a lot more work to do, we’ve always acknowledged that towards the end there will be more details to iron out.” Democrats, led by Rep. Brendan Boyle, questioned the opaque “side deals,” demanding transparency.
The bill now heads to the House Rules Committee, where compromises between deficit hawks and moderates will be finalized. Johnson faces a tight margin, as Republicans can lose only three votes on the floor, assuming unified Democratic opposition. House Majority Leader Steve Scalise admitted, “This is always what happens when you have a big bill like this. There’s always final details to work out all the way up until the last minute.” Democrats, like Rep. Pramila Jayapal, brand it “one big, beautiful betrayal,” while Boyle calls it “unconscionable.”
The “One Big Beautiful Bill Act” encapsulates Trump’s vision but risks alienating key constituencies. Its tax cuts promise relief for millions, yet the CBO warns of a ballooning deficit. Social program cuts could save billions but threaten millions with lost healthcare and food aid. Border and defense investments fulfill campaign pledges but face scrutiny over cost and efficacy. With Republicans facing party splits and Democratic pushback, the bill’s success will reveal their governance strength and influence on America’s trajectory. The public watches, torn between prospects of growth and fears of unfairness.

Proposed Revisions to Strengthen the 'One Big Beautiful Bill Act
Few suggestions for making the "One Big Beautiful Bill Act" more effective and efficient — while preserving the full $150 billion defense allocation, including the $25 billion "Golden Dome" missile defense shield, $34 billion for naval expansion, $21 billion for ammunition restocking, $5 billion for border security, and $9 billion for servicemember quality of life — involve the following revisions to maintain national security priorities, reconcile Republican factions, mitigate fiscal and social impacts, and enhance the bill’s legislative viability;

Strengthen SALT and Medicaid Compromise with Targeted Offsets: The original suggestion to raise the SALT deduction cap to $50,000 for joint filers earning up to $400,000 and phase in Medicaid work requirements by 2027 remains viable to bridge moderate and conservative divides. Rep. Nick LaLota’s demand for a $124,000 cap and Rep. Chip Roy’s push for earlier savings, as he warned, “We are writing checks we cannot cash,” can be addressed by this middle ground. To preserve the $150 billion defense allocation, offset the SALT increase by accelerating the repeal of clean energy tax credits, such as the $7,500 for new electric vehicles, beyond the original suggestion. This could generate an additional $50 billion in savings over a decade, per the bill’s intent to curb Biden-era subsidies, aligning with Roy’s criticism of the “green new scam.” House Speaker Mike Johnson’s call to “compromise on that” supports this approach, ensuring the three-vote House margin while maintaining national security funding.
Refine Tax Breaks for Efficiency: The original proposal to make the no-tax-on-tips provision permanent for workers earning under $50,000 and extend the $2,000 standard deduction and $500 child tax credit boosts beyond 2028 for middle-income earners addresses Adam Michel’s concern. To avoid impacting the defense budget, cap these tax breaks more tightly at $100,000 household income, reducing the CBO projected $4 trillion revenue loss by 2034. This targets relief to low- and middle-income families, including tipped workers, while preserving funds for the $150 billion defense allocation. The 23% small business deduction remains unchanged, supporting economic growth and addressing Rep. Ralph Norman’s worries about credit downgrades.
Moderate Medicaid Cuts with Alternative Savings: The $800 billion Medicaid cuts, risking 7.6 million coverage losses per the CBO, can be softened as originally suggested by starting work requirements at 40 hours per month and removing the $1 million home value cap. This mitigates Liz Pancotti’s warning about job search delays and Rep. Morgan McGarvey’s fear that “nursing homes and hospitals will close.” To fund this and protect defense spending, increase the university endowment tax to 15% for endowments above $1.5 million per student and 20% above $2.5 million, up from the original 10-15% scale. This targets wealthier institutions like Harvard, which lost $2.65 billion in grants, generating additional revenue to offset Medicaid concessions without touching the $150 billion defense budget. Sen. Josh Hawley’s view that cuts are “morally wrong and politically suicidal” supports this balanced approach.
Adjust SNAP Reforms for State Relief: The original SNAP reform reduction to 2.5% benefit cost share and 60% administrative cost share for states prevents cuts to education or tax hikes, as Pancotti noted, while addressing the CBO’s estimate of 3 million losing access. To maintain the $300 billion federal savings and fund the defense allocation, pair this with a phased reduction in the $60 billion agriculture program investment, cutting it to $40 billion over a decade. This preserves aid to farmers but prioritizes fiscal discipline, aligning with Republican work requirement expansions to age 64 and parental exemptions for children under 7. Job training provisions, as originally suggested, counter McGarvey’s concern that “kids in Kentucky will go hungry,” ensuring national security funds remain intact.
Optimize Border Security within Immigration Budget: The original suggestion to reallocate $10 billion from the $45 billion detention budget to community-based monitoring programs improves cost-efficiency, given the 2018 Stanford study’s finding that walls reduce migration by only 0.6%. To preserve the $150 billion defense allocation, including $5 billion for border security, enhance this by redirecting $5 billion from the $46.5 billion border wall to advanced border surveillance technology, such as drones and sensors. This maintains robust enforcement with the 3,000 Border Patrol agents and 10,000 Immigration and Customs Enforcement officers, addressing Roy’s call to “do better before we pass the final product,” while appealing to moderates and protecting national security priorities.
Maximize Green Energy Cuts for Fiscal Offset: The original acceleration of clean energy tax credit repeals, particularly for EV credits, is critical to offset concessions without cutting defense spending. To improve this, eliminate all EV credits ($7,500 for new, $4,000 for used) by 2026, generating over $100 billion in savings, and phase out other clean energy subsidies by 2027, except for nuclear power credits favored by three dozen House Republicans. This aligns with Roy’s “green new scam” critique and avoids economic disruption to automakers like General Motors, ensuring funds for defense and national security remain intact.
Strengthen Nonprofit Provision Safeguards: The original addition of clear criteria and a 60-day review process for revoking nonprofit tax-exempt status addresses Jenna Ruddock’s warning of “hyperbolic and unsubstantiated anti-terrorist rhetoric.” To improve, mandate public disclosure of revocation rationales and a 90-day appeal period, enhancing transparency and reducing legal risks. This preserves the bill’s anti-terrorism intent, critical to national security, while countering perceptions of political targeting, ensuring the defense budget remains untouched.
Calibrate Endowment Tax for Revenue: The revised endowment tax of 15-20% in point 3 improves revenue generation, but to further optimize without affecting defense spending, apply a sliding scale: 12% for endowments above $1.25 million per student, 17% above $2 million, and 22% above $3 million. This maximizes funds from elite institutions, complementing the $330 billion student loan overhaul savings, and addresses Democratic criticisms like Rep. Pramila Jayapal’s “one big, beautiful betrayal” by appearing equitable, while at the same time preserving the full $150 billion defense allocation.
Enhance Immigration Efficiency with Technology: Further optimize the $46.5 billion border wall and $45 billion detention budgets by allocating an additional $5 billion to AI-driven border monitoring systems, reducing reliance on physical infrastructure. This strengthens national security enforcement, complementing the $5 billion border security within the defense budget, and addresses the Stanford study’s findings, ensuring Roy’s fiscal concerns are met without cutting the $9 billion for servicemember quality of life.
Bolster Transparency and Public Engagement: The original call for a summary of changes before the House Rules Committee meeting counters Rep. Brendan Boyle’s “side deals” critique. To improve, launch a public campaign highlighting the $1,000 “MAGA” savings accounts and national security benefits, leveraging Johnson’s “big win tonight” narrative and Trump’s lobbying. This offsets McGarvey’s warnings about hunger and healthcare losses, builds support for the Memorial Day deadline, and ensures the proposed defense allocation is framed as a public priority.
With reporting by Al Jazeera, AP, The Hill, and The New York Times.

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