By Nick Catoggio
Thursday, May 22, 2025
As regular readers know, I try to keep things upbeat in
this newsletter. So let me tell you what I like about The One Big Beautiful
Bill that passed
the House (barely) several hours ago.
I like the fact that it reflects the degree of
seriousness with which Americans now govern themselves.
That’s satisfying. In a democracy, representatives are
supposed to vote in accordance with the will of the people. If the people
demand the policy equivalent of eating out of garbage cans, Congress should
deliver. And it has.
The salient fact about this legislation isn’t that it’s
“bad,” although it is, for reasons we’ll get into. Bad legislation isn’t
noteworthy. We all expect it.
What’s striking about The One Big Beautiful Bill is that
it makes no pretense of trying to grapple seriously with America’s problems,
even though it’s the centerpiece of the president’s agenda.
It’s big-picture stuff. Unlike a continuing resolution
hastily thrown together at the last second to avert a government shutdown,
whatever the House and Senate end up sending to Donald Trump’s desk in this
case will shape the next decade of American fiscal policy and define his
political legacy. It may well be the only major legislation he and his party
enact during his second term.
So one might think Republicans would want to seize the
opportunity to put the country on the proverbial right track, particularly
knowing that Senate Democrats can’t stop them under the simple-majority rules
of budget reconciliation. Instead, what they’ve barfed up makes sense only as a
sort of formal surrender of America’s status as a serious country.
It reminds me of the New York magazine story that
went viral a few weeks ago about rampant
cheating among college students using artificial intelligence. Letting a
computer generate your work product isn’t something you do if you’re striving
to improve yourself by learning the material. It’s something you do when you
don’t care about self-improvement and are living only for the moment, hoping to
pass the class by whatever means.
House Republicans have given up on trying to improve the
country. All they wanted was to pass the class, which they did this morning by
a single vote on the House floor. The One Big Beautiful Bill is to legislation
what an AI-generated essay is to education.
Meditate on this: When I call it “The One Big Beautiful
Bill,” I’m not mocking the president by mimicking his habit of speaking in
dopey Trump-ese. I’m using the official
name given to the bill by House Republicans. American government has become
so self-consciously unserious that it’s now advertising that unseriousness in
how it refers to its own policies.
A fiscal and political travesty.
Handed total control of government last fall, the best
the GOP could do in the House this week was move a package that will produce
another $3.1
trillion in deficits over the next 10 years, according to the Congressional
Budget Office. (Other estimates are more
pessimistic.) The United States is currently on pace to reach its
highest-ever level of national debt as a percentage of GDP by 2032, exceeding
the benchmark set 80 years ago when it was borrowing like mad to fund the
biggest war in history on two fronts. Incredibly, a House bill written and
passed by Republicans will accelerate
that timeline.
And this can’t be stressed enough: $3.1 trillion is the best-case
scenario.
That number is based on assumptions of steady economic
growth and low-ish interest rates in the U.S. over the next decade. Such things
can no longer be taken for granted after the president started the dumbest
trade war in history, raising the risk of a global recession and spooking
bond markets. It is insane that the House would respond to spiking
anxiety about America’s fiscal stability by piling on even more debt, knowing
how investors were
bound to react. But it has.
A few days ago, economist Jessica Riedl
noted that if interest rates settled at 4.5 percent over the next 30 years
instead of the 3.6 percent assumed by CBO, our country would be on the hook for
an additional—deep breath—$40 trillion in interest payments during that period.
Once upon a time, an argument on the right for elevating
Trump was that he would throttle the RINOs who were forever promising to
balance the national books before wilting when given the chance. Making America
great again would require making America solvent again and he
was just the man to do it. The reality this week was precisely the
opposite: Fiscal conservatives, not RINO spendthrifts, were the ones muscled into
compliance by the president.
The bill also amounts to a political betrayal if you take
populism seriously, which, of course, you shouldn’t.
Ideologues like Steve
Bannon warned Republicans not to slash Medicaid, knowing that millions of
lower-income voters who rely on the program have swung right in the Trump era.
Trump himself told the House GOP earlier this week not to “f—
around” with the program beyond cutting “waste, fraud, and abuse,” the
eternal scapegoat for officials who don’t want to reckon seriously with the
country’s fiscal predicament.
Unfortunately for Republicans, there was nothing else in
the budget they could realistically cut that would produce big savings without
triggering a political backlash. Medicare, Social Security, and defense are off
limits for now (but
not for long!) and interest payments on America’s debt are non-negotiable.
So in the end, they had no choice but to f— around with Medicaid: The
new work requirements and paperwork standard for the program set forth in the
House bill are projected to push 7.6
million blue-collar enrollees out.
A populist failure.
That would be defensible in populist terms, perhaps, if
most of the other economic benefits under the bill were set to accrue to the
working class. They aren’t.
Per
CBO, the reforms to Medicaid and food stamps in the legislation mean that
the poorest 10 percent of Americans will see their overall household resources
decline as a percentage of income over the next decade, while the richest 10
percent will see their resources rise. The tax cuts under the bill will save a
family that earns under $50,000 annually less
than $300 in 2027, not quite a dollar a day.
The closest thing to a real populist victory in the
legislation is the new “no
tax on tips” provision, keeping a promise that Trump made as a candidate
last year. But that’s a gimmick, 99 parts pandering to one part serious
policymaking. No one can explain logically why the restaurant staffer who
brings your food to the table should get to deduct part of his earnings while
the person who prepared it shouldn’t. It’s simply a legislative bribe to
hospitality workers, most notably the ones who wield outsized electoral
influence in the important swing state of Nevada.
My guess is that the president hasn’t given a moment’s
thought to the policy implications of “no tax on tips,” any more than he knew
precisely what he meant when he told Republicans not to “f— around with
Medicaid.” (For the record, they
didn’t know either.) Last year at a rally in New York, he promised locals
that he would lift
the existing cap on federal income tax deductions for state and local
taxes; this week, desperate to win over recalcitrant fiscal conservatives in
the House, he decided he was against lifting the
cap after all. None of this means anything to him in policy terms.
As with the students using AI to cheat, it’s all about
earning a “win.” The details are irrelevant.
Even the process by which the bill passed was a travesty.
“If something is beautiful, you don’t do it after midnight,” Rep. Thomas
Massie, one of two Republicans to oppose the bill, said
of the wee-hours floor vote this morning. The Rules Committee that advanced the
legislation earlier this week also met
overnight, before the final bill was drafted or negotiations between the
various factions were complete. Longtime Republican legislative aide Brendan
Buck said he’d never seen such a thing, and no wonder: Traditionally, conservatives
have demanded at least 72 hours to consider legislation before it’s voted on so
that they’re not left rubber-stamping bills on the speaker’s say-so.
The most one can say in defense of all of this is that
everyone involved understood that the House bill won’t pass as-is in the
Senate. A fiscal hawk like Rep. Chip Roy could justify voting for it simply in
order to trigger negotiations with the upper chamber, reserving the right to
oppose a final compromise if it doesn’t pass muster.
But if you believe there’s a chance of that final bill
going down, I wonder if you’ve paid any attention to politics since 2015.
Members of the president’s party are not going to snuff his signature
legislation at the finish line on the grounds that it’s garbage from tip to
tail. To do that, they’d need the support of their constituents, and their
constituents emphatically do not care
about the long-term solvency of their country. What they care about is
Donald Trump getting what Donald Trump wants, whatever that might mean for
America’s trajectory.
They’ve given up on self-government, so their
representatives have given up on it too.
No tomorrow.
A party that treats “American greatness” as its north
star is a party that should be especially attuned to the long-term consequences
of policy.
Greatness isn’t easy, and it certainly isn’t achieved in
a day, as the president has recently
discovered. If you want to maintain the decadent and ultimately
unsustainable status quo, you elect Democrats. If you want to do the hard stuff
that brings about an American renaissance, you elect Trump. The left doesn’t
care what the country that our children will inherit looks like. The right
does, supposedly.
Trump often rationalizes his policies in terms that are
forward-looking. When he asks kids to make do for now with
two dolls instead of 30, he’s asking their parents for patience with his
trade policies. It will take time, you see, for businesses to suffer enough
financially that they’re forced to begin manufacturing their products in the
United States to avoid tariffs. The same goes for immigration. Ridding America
of parasitic
foreigners won’t happen overnight; the country must prepare itself for a
long and “bloody”
story.
He has a clear vision for America, and the other party
very much does not. When he makes a move on policy, it’s because he’s thinking
several moves ahead with an eye on the “greatness” that’s waiting just over the
horizon.
Except he isn’t. That’s the opposite of how Trump governs
in practice.
The One Big Beautiful Bill is a vintage example. The last
thing America should be considering in an age of rising interest rates and
shaky economic growth is piling on more debt. That’s the sort of thing you do
if you don’t care what the next moves on the chessboard are relative to
your own ephemeral popularity. Some House conservatives reportedly agitated for
seizing the chance to crack down on spending in the new legislation in the
belief that they’re destined
to lose their majority next year anyway, but it seems that argument
ultimately went nowhere. For the party of “American greatness,” tomorrow never
takes precedence over the political needs of today.
Look back over Trump’s first four months and you’ll find
other examples of that across the policy spectrum. A movement that’s thinking
seriously about how to make sure that its people thrive long-term would never discourage
vaccination by putting cranks in charge of health policy. It wouldn’t
instigate a brain drain among government
workers and research
scientists by cutting off their funding for the sake of savings that haven’t
actually occurred. It wouldn’t chase
the best and brightest international students away from coming to America
in the name of waging culture war. And it wouldn’t foolishly incentivize its
adversaries to drive a hard bargain in negotiations by capitulating
quickly in some cases and continuing
to pressure those who’ve cooperated in others.
Even Trump’s “Liberation Day” tariffs, his most
forward-looking policy, fit the pattern. The goal there was to fundamentally
and permanently restructure trade between our country and the rest of the
world; he lasted all of a week before throwing
in the towel, alarmed by the entirely predictable effect that enormous new
taxes on foreign goods had on markets.
There’s no long-term thought to any of this. I’ve used
this metaphor
before, but it’s so apt that I feel obliged to return to it: Trump and his
movement govern not like chess players but like Jacobins who’ve overrun a royal
palace and are mid-frenzy in smashing the place up. They’re not executing an
intricate 12-step plan to national greatness, they’re looting whatever they can
tear from the structure. They’re lost in the moment.
Tomorrow doesn’t matter, any more than it does to the
kids using AI to take their tests for them. All that matters is today.
A laughingstock.
Last week, economist Noah Smith ticked through a few of
the ways in which the world’s greatest country has, shockingly quickly, become
an international laughingstock.
Not all of it is Trump’s fault. America’s struggle to keep
its planes from crashing into each other didn’t begin on the day he took
office, for instance. But it’s remarkable how much damage he’s done to
the country’s reputation in just four months, from staffing up with reckless,
unqualified clowns to ruining
valuable alliances for no discernible reason to indulging in corruption so
blatant that visiting dignitaries can’t help but mock
him for it.
If the ultimate policy endgame of making America great
again is securing our country’s global preeminence over China, Trump 2.0 has
backfired as spectacularly as it could have. The Chinese appear to have taken
the White House’s hasty retreat on trade as evidence
of the president’s weakness. Nations that once would have followed
America’s lead have been forced
to reconsider, not wanting to ride shotgun in a vehicle driven by a drunk.
An enormous international
survey published earlier this month found perceptions of the United States
more negative on balance than those of China.
It will be a while before ours is a truly weak country,
especially militarily (although we’re
getting there), but we’ve already become an unserious country, and
increasingly everyone in the world understands it.
That’s the proper frame for understanding the absurdly
named One Big Beautiful Bill, the latest proof of Smith’s thesis. Compare the
reaction of the grassroots right today to their reaction in December when House
Republicans moved to pass another ho-hum continuing resolution that would
prevent a government shutdown. In the latter case, egged on
by Elon Musk, they threw a collective tantrum that temporarily derailed the
bill; today, faced with legislation that would do much more fiscal damage
long-term and might plausibly trigger an eventual debt crisis, they’re pleased
as punch. Nothing matters except the politics: In December, the House GOP
cooperated with Joe Biden to pass their bill, and today they’re cooperating
with Donald Trump.
Not serious people, not a serious country. And not a
country that should, or will, lead others in the future.
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