Senate Passes Trump-Supported "Big and Beautiful" Bill
On Tuesday, July 1st local time, the U.S. Senate passed a comprehensive tax cut and spending bill supported by Trump with a 51-50 vote after several days of debate. The bill has now been submitted to the House, aiming for a vote before Trump's July 4th deadline.
The bill aims to expand tax cuts while reducing spending on health care, welfare, and green subsidies, and plans to increase the federal debt ceiling by another $5 trillion, drawing attention both inside and outside Congress.
Vance Casts the Decisive Vote to Break the Deadlock
During the Senate vote, as the result was deadlocked at 50 votes to 50, Republican Vice President Vance, serving as Senate President, cast the decisive vote, allowing the bill to pass by a narrow margin of 51-50.
Despite strong pressure from Trump, some Republican senators like Thom Tillis, Rand Paul, and Susan Collins still chose to defy party lines, voting against the massive tax cut and spending bill, demonstrating clear divisions within the party regarding the bill.
House Faces Pressure and Resistance to Pass Bill
Though Trump optimistically predicted the bill would pass "easily" in the House, the outlook for the House vote remains uncertain. House Speaker Mike Johnson needs to minimize dissent within the Republican Party, as they can only afford to lose up to three Republican votes, or the bill might fail to pass.
Some members of the House have already expressed opposition, including California Republican Congressman David Valadao and Texas Republican Congressman Chip Roy, citing concerns over the bill’s Medicaid cuts and the increase in the federal debt ceiling, which could impact ordinary citizens and future fiscal security.
Bill Might Exacerbate U.S. Debt Risks
According to an analysis report published by the Congressional Budget Office, the current version of the "Big and Beautiful" Bill will increase the U.S. national debt by $3.3 trillion over the next decade, and by cutting welfare and medical spending, it might intensify intergenerational wealth transfer, placing a heavier debt burden on younger generations.
Nonpartisan analysts point out that rising debt will suppress future economic growth, raise borrowing costs, and squeeze other government spending, placing long-term pressure on the U.S.'s fiscal condition.
Trump Emphasizes Economic Benefits of the Bill
After the bill passed, Trump stated that the bill would "easily" pass in the House, downplaying the risk of Medicaid cuts due to spending reductions, emphasizing that the bill only cuts "wasteful spending," and asserting that the bill will help stimulate the economy and reduce future tax burdens.
Trump stated, "This is good for everyone, and I think the House will pass it smoothly, even easier than the Senate did."
Markets Remain Watchful Ahead of Key Vote
As the July 4th deadline approaches, markets and investors closely monitor the outcome of the House vote, as the final passage of the bill will have a profound impact on U.S. fiscal policy, debt structure, and the future economic trajectory.
At the same time, the bill's spending cuts in health care, green subsidies, and welfare areas may trigger social attention and discussion, potentially becoming a significant issue in future election cycles.
