Donald Trump has signed into law his “big beautiful bill.” The headline? A vast extension of the tax cuts he introduced during his first term—overwhelmingly benefiting the top 1%.
Technically, it’s a budget reconciliation bill, meaning it could be passed with a simple majority, shielding it from Democratic filibusters. But there’s nothing technical about the consequences.
It will be the most expensive reconciliation bill in US history—adding $4.1 trillion to the national debt by 2034, or $5.5 trillion if extended permanently. According to the Congressional Budget Office, this would push US debt from 100% of GDP today to 127% by 2034. And that’s before factoring in the ongoing costs of the extended tax cuts.
The Price? Your Healthcare
The most immediate impact will be felt by between 12 and 17 million Americans who will lose all or part of their access to Medicaid. But the fallout extends far beyond individual patients.
For decades, US hospitals—especially in rural and suburban areas—have teetered on the brink. The fragile business model relies on revenue from elective procedures (some of them dubious in necessity) to subsidise the skyrocketing costs of emergency care. When elective income drops and emergency costs rise, hospitals close. And that is exactly what is about to happen—at scale.
Planned Parenthood is braced to lose about a third of its 300 clinics, cutting off access to reproductive healthcare for millions. In states with aggressive abortion bans, there’s already been an exodus of OB-GYNs and reproductive health specialists. The results speak for themselves: in the reddest states, rates of infant mortality, stillbirths, and maternal deaths are rising. In the bluest, they’re falling.
To put it bluntly: California now has the same infant mortality rate as Germany. Mississippi? The same as Albania.
Abortion bans don’t save unborn children. They kill living ones—and their mothers too.
The Poor Get Poorer, Unless They Live in Alaska
Eight million Americans will lose access to food stamps (SNAP). With one curious exception: Alaska. Thanks to a backroom deal to shore up Republican votes, Alaskans keep theirs. Everyone else is out of luck.
Meanwhile, the budget for Immigration and Customs Enforcement (ICE) will jump from $3.5 billion to $48.5 billion. That’s not a typo. ICE will become the largest law enforcement agency in the US—with a bigger budget than Brazil’s entire military.
Over the next four years, ICE will receive more money annually than the combined budgets of the FBI, DEA, ATF, US Marshals, and Bureau of Prisons. Combined.
ICE is opaque, largely unaccountable, and increasingly authoritarian. It can override habeas corpus. It regularly detains people without trial. It operates in legal grey zones where immigrant communities are harassed, disappeared, or terrorised. It also appears to have growing links with white nationalist militias.
Trump now has something every strongman dreams of: a well-funded, loyal paramilitary force, untethered from Congress or the Constitution. A private army, armed to the teeth and ripe for abuse—whether to round up migrants or intimidate political opponents.
The Markets Shrug—For Now
Wall Street responded cautiously. Much of the extra borrowing was already priced in. But that doesn’t mean America is out of the woods.
The US already needs to convince global investors to buy $1 trillion in government debt—every month for the next year. That was true before Trump’s bill passed. Now, it’s worse.
By comparison, the UK Chancellor is worried about debt interest hitting 8% of public spending. The US is at 16% already—and set to hit 20% by the end of Trump’s second term. That’s unsustainable.
And while Trump brags that tax cuts will drive growth, investors remember what happened last time: a short-lived sugar rush followed by ballooning deficits and rising interest rates. This time will be no different—just with more jackboots.
The Multiplier Problem
As I’ve explained in previous posts, tax cuts for the rich don’t boost the economy. The reason is simple: richer people tend to save, or spend on imported goods. Poorer people spend their income locally, triggering a multiplier effect that stimulates economic activity.
Trump’s bill does the opposite. It makes the rich richer and the poor poorer, which slows the economy. It’s never worked before, and it won’t work now.
And yet that’s the entire economic justification behind this bill: that a flood of private wealth at the top will lift everyone else. It didn’t happen under Reagan. It didn’t happen under Bush. It didn’t happen under Trump 1.0. But apparently, third time’s the charm?
The Real Political Suicide Pact
Here’s the rub. The states that pay the most in federal taxes—the ones who benefit most from these tax cuts—are overwhelmingly Democrat-controlled. The states that are most dependent on federal spending, and most exposed to these brutal cuts, are Republican.
In other words: this bill takes healthcare, food, and public services away from Trump voters in red states, and gives tax breaks to wealthy liberals in blue states.
Republican members of Congress have just voted to rob their own constituents to enrich their political enemies. Good luck explaining that at the next mid-terms
Unless, of course, they’re not planning to hold any more elections. In which case, the $48 billion for ICE makes a lot more sense.
https://www.congress.gov/bill/119th-congress/house-bill/1/text