The One Big Beautiful Bill Act
Is the One Big Beautiful Bill Act good for America? Viewpoints from multiple sides.
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Snippets
President Trump visited central Texas to survey damage from the catastrophic flooding last weekend that killed more than 120 people. At least 150 are still missing.
The Trump administration announced that it will impose 30% tariffs on imports from the European Union and Mexico starting Aug 1. President Trump also announced plans to impose 50% tariffs on all Brazilian goods partly in response to the country’s “unfair” trade relationship with the US.
A New Hampshire federal judge issued a new nationwide block against President Trump’s executive order seeking to end birthright citizenship. The pause comes after a Supreme Court ruling last month that placed limitations on the power of federal judges in issuing universal injunctions.
The State Department began issuing termination notices to more than 1,300 government employees as part of the Trump administration’s effort to downsize the federal workforce.
Russia launched multiple large-scale aerial attacks against Ukraine last week, including one that involved a record 728 drones. The escalation comes after President Trump accused Russian President Vladimir Putin of impeding a peace deal and pledged more military support for Kyiv.
What’s happening
President Trump recently signed into law the One Big Beautiful Bill Act (OBBBA), after the House and Senate narrowly voted to pass it. The 900+ page OBBBA is sprawling, but at its core solidifies $4.5T in tax breaks originally enacted in Trump’s 2017 Tax Cuts and Jobs Act (TCJA), which were set to expire on Dec 31, 2025. It also adds new tax breaks and makes significant budgetary changes.
Tax breaks: Among the most notable implications for taxpayers, the bill permanently extends the lower tax rates that were established by the TCJA, with the maximum tax rate for individuals, estates, and trusts set at 37% (as opposed to the 39.6% prior to TCJA). OBBBA also extends the child tax credit and increases it from $2,000 to $2,500 per qualified child (i.e., one with a Social Security number and US citizenship) for 2025-2028. The bill increases the state and local tax (SALT) deduction cap from $10,000 to $40,000 for all tax years 2025 and beyond, until the $10,000 cap reverts in 2030.
For businesses, OBBBA makes permanent the qualified business income deduction (also known as the pass-through income deduction), and increases it from 20% to 23%. Under the bill, qualifying workers will – through 2028 – see their first $25,000 in tips exempt from income taxes, with the deduction decreasing if their total income exceeds $150,000.
Program restrictions and additions: Among the most noteworthy changes, OBBBA cuts spending for Medicaid and the Supplemental Nutrition Assistance Program (food stamps) by roughly $1.2T through 2034, primarily by imposing stricter work requirements for eligibility. OBBBA also rolls back and phases out clean-energy tax credits that were expanded in 2022 under President Biden’s Inflation Reduction Act. Conversely, the program directs $150B in new funding to the Department of Defense (DoD) and another $165B to the Department of Homeland Security (DHS).
In the wake of this historic bill passing into law, a variety of diverging opinions have been put forward on whether OBBBA will help or hurt the US. Today, we bring you the viewpoints from multiple sides. Let us know what you think.
Notable viewpoints
More opposed to the One Big Beautiful Bill Act:
The bill exemplifies poor fiscal discipline and will harm the US economy in the long run.
OBBBA does not promote long-term economic growth. Rather, it relies upon a short-term bump from tax cuts at the cost of driving an estimated $3.9T+ to the national debt by 2034. Furthermore, OBBBA is not a serious tax reform, as the bill increases wasteful government spending and handouts in the form of tax credits worth hundreds of billions of dollars. Cutting taxes without cutting government spending simply increases the debt crisis for future generations.
OBBBA is disingenuous in its approach towards decreasing spending, as the bill does not address the entitlement programs that cost the US the most money. It’s reasonable to reduce spending on Medicaid, but it should be coupled with reduced spending within Medicare and Social Security. Instead, OBBBA provides tax-deductions to seniors.
The bill disproportionately benefits wealthier Americans while hurting poorer Americans.
Under OBBBA’s tax cuts, by 2027, individuals earning more than $1M in annual income will enjoy a nominal after-tax income boost over 800x larger than that enjoyed by the lowest earners. Moreover, the small tax cuts granted to the lowest earners by OBBBA are offset by cuts to social programs such as Medicaid, which are effectively taking healthcare away from working Americans. In total, the bottom quintile of Americans will see a net decline in resources under OBBBA while the top 1% will see an increase of $30,000 each.
In order to pay for individual tax cuts, OBBBA will kick an estimated 11.8M lower-income Americans off of their health insurance by 2034. The cuts are so bad and widespread that Republicans added a $50B “rural health fund” to OBBBA to try to offset the damage that will be felt by their own constituents.
OBBBA continues and expands the practice of the qualified business income deduction, which is a primary driver of income inequality in the US – over 70% of all qualified business income goes to the top 1% of earners. Under OBBBA, qualified business income tax breaks will add an estimated $736B-$820B to the national deficit, and over half of that amount will go to millionaires.
OBBBA’s cuts to Medicaid and food stamps will reduce after-tax income for the bottom 60% of US households, increase healthcare premium costs for American families that get their health insurance through the Affordable Care Act marketplace, create higher energy prices by ending clean-energy subsidies, and lead to higher mortgage rates from increased federal borrowing.
The cost of college, along with student debt, will dramatically increase as OBBBA dismantles the existing student debt repayment program that provides favorable terms to lower- and middle-income US families.
The bill threatens the future of American excellence.
OBBBA neglects the foundation of what makes the US successful. For instance, repealing tax credits for clean energy investments will harm the future of American energy production as well as developing technologies like AI that are dependent on it. Moreover, OBBBA threatens American economic debt-to-GDP stability, making it a riskier place to invest.
More supportive of the One Big Beautiful Bill Act:
The bill will drive financial growth for American businesses and workers.
The policies being enacted by OBBBA have worked previously. Following the 2017 tax cuts, which the bill makes permanent, the unemployment rate hit a 50-year low of 3.5% in 2019 while median household income rose by $4,400 (almost 7%). Moreover, the qualified business income deduction program, also enacted in 2017, supported 2.6M workers earning $161B in 2024 while generating $325B of GDP. Looking at the next 4 years, according to the Trump administration’s Council of Economic Advisers, the OBBBA will increase GDP by up to 4.9% and increase annual real wages by up to $7,200.
OBBBA takes care of American workers, as it will redirect an estimated $249B in annual wages paid to undocumented immigrants to lawful American workers. OBBBA also formalizes no tax on tips or overtime pay, which will boost earnings for the working class, and makes permanent Trump’s 2017 tax cuts, under which the net worth of the bottom 50% of American households increased faster than the net worth of the top 10%.
In extending the 2017 tax cuts, OBBBA will provide businesses with the confidence needed to make long-term investments, hire, and expand. In continuing the qualified business income deduction program, OBBBA will generate an estimated 1M+ new jobs and $750B+ in economic growth over the next decade.
OBBBA will provide financial relief to working families through the bill’s higher child tax credit, which 47M American families currently claim. The typical family will get up to $10,900 in additional pay. OBBBA further supports working families by expanding access to the child care credit and making the paid leave tax credit permanent.
The bill had to happen. If the 2017 tax cuts were allowed to expire at the end of 2025, Americans would have been hit with a $4.5T tax hike.
The bill promotes social and fiscal accountability among the American population.
While Democrats tout the CBO’s estimate that OBBBA may result in 7.8M Americans losing Medicaid access by 2034, they ignore the fact that roughly 4.8M of those in the estimate would lose access simply because they don’t currently meet the bill’s requirement that healthy, prime-age adults work or volunteer at least 20 hours a week to receive it. Americans should be required to provide basic productivity back to the country in order to receive entitlements.
OBBBA will reform student loans. In putting a cap on graduate loans, the bill makes it harder for universities to raise tuition in pursuit of higher loan subsidies. OBBBA will also crack down on state-level schemes that effectively abuse food-stamp programs by wrongly expanding usage through, for example, waiving work requirements for food stamp eligibility.
The bill makes the US safer.
OBBBA supports a stronger US border by allocating tens of billions to the DHS to secure our borders as well as arrest and deport criminal undocumented immigrants. Doing this will allow DHS to prevent gang-related crimes such as human trafficking and smuggling as well as defend against foreign terrorist organizations.
Be heard
We want to hear from you! Comment below with your perspective on the One Big Beautiful Bill Act and we may feature it in our socials or future editions. Below are topic ideas to consider.
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Music on the bottom
Always good to mix a train song in. Enjoy this rendition of “Slow Train” by Bob Dylan and the Good Ol' Grateful Dead. - Dylan
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