How Republicans can enact Trump’s tax cuts

OPINION:

Republicans are moving forward on “one big, beautiful bill” to deliver President Trump’s priorities.

The House-passed budget resolution has tasked the Energy and Commerce Committee with finding $880 billion in savings. To make the Trump tax cuts permanent and make room for cutting other taxes, they can sell government assets to raise revenue and cut spending.

Selling government-owned land and radio waves raises revenue while shrinking government and spurring economic growth. Spending restraint helps slow inflation and boost consumer confidence.

Energy and Commerce Committee Republicans can use both strategies to make Mr. Trump’s broad tax cuts permanent, abolish taxes on tips and restore pro-growth policies such as full business expensing while cutting spending and reducing the size of government.

First, one of the biggest revenue-raisers is spectrum auctions. All wireless technology — cellphones, Bluetooth, WiFi, AM radio — uses radio wave frequencies to send data between devices. The Federal Communications Commission auctions off exclusive licenses to use a spectrum of frequencies so these signals don’t interfere with one another. These auctions have generated $233 billion since 1994, while wireless investment has added $260 billion to gross domestic product. Of this, $118 billion has come in since just 2018. Demand is growing.

The FCC hasn’t had the authority to auction spectrum for almost three years. Reopening the spectrum auctions to wireless carriers eager to deploy 6G service could generate tens of billions of dollars in revenue. Because of the pent-up demand, it could be as high as $100 billion. It could also generate close to $400 billion in consumer benefits.

Congress should include spectrum auctions in reconciliation to help enact tax cuts and promote economic growth. Something akin to Sen. Ted Cruz’s Spectrum Pipeline Act, which would make 600 megahertz of government-owned spectrum available for private-sector bidders, would benefit consumers for decades.

Second, this is not the only asset the committee has jurisdiction to sell. The administration has made energy production a top priority. It should sell off as much land as possible to the energy industry, open new lands to exploration, and streamline permits and leases.

Beyond oil and gas, new mines for critical minerals on federal land should be leased or sold as quickly as possible. This could raise hundreds of billions of dollars in revenue and help spur growth in energy production and manufacturing while lowering consumer costs.

Finally, the Energy and Commerce Committee has jurisdiction over Medicaid, which Democrats already use to attack the whole project. However, Republicans do not need to cut Medicaid to find savings; they must restore work requirements, end improper payments and make the money follow the recipient.

Medicaid has 80 million enrollees and costs $1 trillion annually. This is 10 million more recipients than before the COVID-19 pandemic when many able-bodied young adults were added to the program. Simply allowing states to require able-bodied adults to hold down a job or look for work is not cutting Medicaid. It’s what Bill Clinton and Newt Gingrich did with welfare reform in 1996, and it’s what Ronald Reagan pioneered as governor of California.

Work requirements are popular and save billions of dollars while expanding our workforce. The Congressional Budget Office projected that the House-passed work requirements from the 2023 debt limit negotiation would save more than $100 billion over 10 years.

Better systems to prevent improper payments could also save taxpayers billions. According to a Wall Street Journal report, Medicaid paid insurers twice for the same procedures last year, to the tune of $4.3 billion. By ending improper payments, taxpayers could save more than $40 billion over a decade.

Changing the block grant model so the money follows the recipient can also cut costs. Instead of sending money to states to administer Medicaid, much of which is swallowed up in state bureaucracy, Congress could peg the program’s growth to population growth plus inflation. Each enrollee would be entitled to the same amount, but now the money would follow them if they moved states.

Rather than paying more to states that run up costs, Congress would pay more to states with growing populations and reduce spending on states where the Medicaid population is shrinking. This would reduce the program’s growth over time, saving tax dollars without ever cutting the amount each enrollee receives.

Between auctioning spectrum, selling federal land for resource development and restructuring Medicaid to eliminate waste, Congress can make Mr. Trump’s tax cuts permanent while delivering no tax on tips and business provisions. This was Mr. Trump’s greatest legacy from his first term. Republicans should make it stick in his second.

• Grover Norquist is president of Americans for Tax Reform.