The One Thing Both Parties Agree On: More Deficits and Debt

By Matt Weidinger

Thursday, June 05, 2025

 

The House of Representatives recently passed by a single vote Republicans’ “One Big Beautiful Bill” that reflects President Donald Trump’s tax and spending agenda, and GOP senators are now working to put their own stamp on the bill. Given that partisan pedigree, you would think this bill had little in common with legislation that Democrats crafted during the Biden era. But a comparison reveals one dangerous issue that both parties agree on: significantly increasing deficits and debt.

 

Consider the last two administrations. Before Trump’s first term started, gross federal debt stood at $20 trillion. Despite his promises to pay it off, four years later it had risen to $27.7 trillion, up more than $7.7 trillion. In four years under President Joe Biden, the debt grew to $36.2 trillion, up another almost $8.5 trillion.

 

Those figures include the massive federal response to the Covid pandemic, which spanned both administrations. Bipartisan legislation that Trump signed in March 2020 — providing stimulus checks and temporary pandemic benefits — added nearly $2 trillion in debt. In December 2020, Trump signed a bipartisan extension, adding almost $1 trillion more. And in March 2021, Biden signed Democrats’ partisan stimulus law, offering still more stimulus checks plus other expanded benefits, adding another nearly $2 trillion in debt.

 

One could argue that much of this spending was required to address the pandemic. But those figures don’t include other proposals such as Biden’s massive “Build Back Better” agenda, which House Democrats passed in November 2021. That legislation, which called for trillions in new and expanded benefits, was subsequently rejected by key Senate Democrats on cost and policy grounds.

 

The bill was riddled with budget gimmicks. Many of the supposedly “transformative” legislation’s benefit expansions were only temporary — often randomly so. It proposed benefit expansions ranging from one to six years, which the Congressional Budget Office (CBO) admitted “would increase the deficit by $3.0 trillion” over just the next decade if made permanent.

 

The most blatant example was Build Back Better’s one-year extension of the soon-to-expire child-tax-credit expansion from Democrats’ stimulus law. The $185 billion cost was a fraction of the huge $1.6 trillion price tag for the permanent extension that Biden and key supporters wanted. Yet the House bill mimicked the stimulus law’s one-year expansion in order to minimize its cost by assuming future extension. When the legislation died in the Senate, so did Democrats’ expansion.

 

Republican’s Big Beautiful Bill harbors similar gimmicks. Much attention has focused on Democratic opposition to its significant proposed savings in food stamps and Medicaid benefits. But despite those savings, CBO estimates that the legislation would explicitly add $2.4 trillion to already huge deficits expected over the next decade, driven by still greater tax cuts. Some Republicans have sought to wish away much of that, arguing that extensions of current tax policies don’t count. But that doesn’t change their real effect on increasing deficits and debt.

 

Even that is an underestimate. Just as Democrats proposed short-term benefit expansions, Republicans are proposing tax relief lasting only through the Trump administration. If these policies are made permanent by future Congresses, the Joint Committee on Taxation estimates that they would add another $1.7 trillion to deficits over the coming decade. While that’s less than the $3 trillion in hidden spending increases in Build Back Better, the nonpartisan Committee for a Responsible Federal Budget estimates that, counting the extension of its tax cuts plus interest, total debt would rise by more than $5 trillion during the next decade under the GOP bill.

 

In the end, Republicans are making a political calculation that, as former Vice President Dick Cheney said, “deficits don’t matter.” This sentiment is bipartisan, history indicates, and Republicans regularly suggest that deficit-increasing tax cuts stimulate the economy while Democrats say the same about higher government spending. That’s familiar ground, and a worthy debate.

 

But regardless of either side’s rhetoric, ultimately deficits do matter. Already, interest on the debt exceeds all spending on children, crowding out important needs. Meanwhile, Wall Street is warning that the Big Beautiful Bill “could stoke investor anxiety about rising deficits, push up U.S. borrowing costs and damage the broader economy.” JPMorgan Chase CEO Jaime Dimon adds, “I don’t know if it’s going to be a crisis in six months or six years.”

 

Whenever it occurs, if a debt crisis is triggered by a budget-busting bill, the party behind it will be blamed not just for that legislation, but also for the long bipartisan history of mounting deficits and debt. And that will be a terrible price to pay.