After the Congressional Budget Office (CBO) released its estimates for the distributional effects of the One Big Beautiful Bill Act, this economist questioned the Donald Trump administration about the inflating deficit and its inclination toward catering to the wealthiest Americans.
What Happened: The CBO documents highlighted that tax changes, including extending provisions of the 2017 tax act, would lead to an increase in the federal deficit by $3.8 trillion.
Meanwhile, it also underscored a $698 billion reduction in federal subsidies from changes to the Medicaid program and $267 billion less in federal spending for the Supplemental Nutrition Assistance Program (SNAP).
The document also stated, “Household resources would decrease by an amount equal to about 2 percent of income in the lowest decile (tenth) of the income distribution in 2027 and 4 percent in 2033, mainly as a result of losses of in-kind transfers, such as Medicaid and SNAP.”
On the other hand, resources would increase by an amount equal to 4% for households in the highest decile in 2027 and 2% in 2033, mainly because of “reductions in the taxes …