President Trump’s “big beautiful” tax and budget bill will not pass the House of Representatives as it’s currently written, putting the future of his agenda at risk. Republicans are approaching Speaker Mike Johnson’s, R-La., self-imposed Memorial Day deadline, and there are approximately 15 members who say they are a “no.”
“I would say that if the vote were held right now, it dies a painful death,” Rep. Andy Ogles, R-Tenn., told reporters.
The outstanding issues include state and local tax deductions, Medicaid reform and deficit increases.
The president met with Republicans on Capitol Hill Tuesday, May 20, to provide encouragement. The meeting was described as very positive.
“This was a meeting of love,” the president said as he left. “There was great unity in that room.”
What do GOP members want from Medicaid?
According to those in the room, Trump told Republicans who were concerned about cuts to Medicaid exactly what they wanted to hear –– “Don’t F with Medicaid.” Republicans say they took that to mean cut waste, fraud and abuse, not benefits.
There are some Republicans who want to reduce the federal government’s share of costs for Medicaid expansion recipients, which currently stands at 90%. Some lawmakers believe it should be in line with the traditional Medicaid payment share which stands between 50% and 77%, depending on the state. But making that change could alienate moderate members.
“We have to defend against it, because they’re in a sense of putting poison pills in that won’t pass,” Rep. Don Bacon, R-Neb., said.
What SALT reforms are some members fighting for?
Then there’s the state and local tax deduction, or SALT. Blue-state Republicans are working to increase the write-off from the current $10,000 to $30,000. Five members rejected an offer of $30,000. Reports indicate they’re trying to get a deduction of $62,000 for individuals and $120,000 for couples.
“We hope his remarks today motivate the Speaker to advance a SALT proposal that delivers meaningful relief for our middle-class constituents, as we have worked in good faith with House Leadership for more than a year,” Reps. Mike Lawler, R-N.Y., Nick LaLota, R-N.Y., Andrew Garbarino, R-N.Y., Young Kim, R-Calif., and Tom Kean, R-N.J., said in a joint statement.
What would the bill cost over time?
Ryan Ellis, president of the Center for a Free Economy, estimates that a $30,000 cap would be enough to placate 97% of taxpayers who deduct state and local taxes from their federal returns.
In the end, all this negotiating comes down to federal spending and the national debt. The cuts to Medicaid would save the government hundreds of billions of dollars over the next 10 years, but potentially lead to 8.6 million people losing their health insurance. A SALT cap increase would reduce federal revenues and therefore add to the deficit.
No matter what, the Congressional Budget Office predicts this bill will add approximately $3.8 trillion to the national debt over the next decade, which is enough for Rep. Thomas Massie, R-Ky., to vote no. “At least three and a half trillion of that is a direct result of the policies in this bill. You can’t tell the American people, you can have all of these free things and not pay taxes,” Massie said.
Trump was asked what he thought about the holdouts after his meeting ended.
“Anybody that didn’t support it as a Republican, I would consider to be a fool,” Trump said.
Democrats are uniformly opposed to the bill. For it to pass the House, 217 of the chamber’s 220 Republican members will need to vote in favor.
