President Trump’s massive tax and spending cut package cleared Congress on Thursday, as House Republicans delivered the bill for his signature before his July Fourth deadline.
House Speaker Mike Johnson, Louisiana Republican, succeeded in passing the One Big Beautiful Bill Act on a 218-214 vote.
“This is jet fuel for the economy, and all boats are going to rise,” Mr. Johnson said.
Mr. Johnson said Republicans did not want to waste the gift of unified government they were given in the November elections and gave voters what they wanted, including sweeping tax and spending cuts, energy deregulation, and defense and border security priorities.
The legislation’s centerpiece was a permanent extension of Mr. Trump’s first-term tax cuts for individuals and small businesses.
Only two Republicans, Reps. Brian Fitzpatrick of Pennsylvania and Thomas Massie of Kentucky, voted against the final bill.
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All Democrats voted in opposition to the bill, which stopped the largest tax increase on Americans in modern history. This was the same in the Senate, where Vice President J.D. Vance had to break a tie so the chamber could pass it on a 51-50 vote.
Both chambers spent more than 24 consecutive hours debating and negotiating, rare congressional all-nighters, before passing the bill.
Mr. Massie has opposed every version of the Trump agenda package because it would increase the deficit. Mr. Fitzpatrick voted for the original House bill but had concerns about the Senate-approved cuts to Medicaid.
For other holdouts who ultimately voted for the package, the driving push was ensuring the 2017 Trump tax cuts did not expire at the end of the year, which would have triggered $4 trillion in tax increases.
The bill also includes temporary tax breaks to fulfill Mr. Trump’s campaign promises of no tax on tips, overtime, Social Security and car loan interest.
“We heard the message that the voters sent, who said they’re sick and tired of high inflation, of high gas prices, of not being able to fill up their grocery cart because of the spending in Washington, for Washington, at their expense,” said House Majority Leader Steve Scalise, Louisiana Republican. “And so what does this bill do? It says we’re finally going to turn that around and deliver a bill that focuses on families in America.”
The legislation is chock-full of other Republican priorities, such as provisions to spur domestic energy production and funding for border security, immigration enforcement and the national defense.
The new funding includes $46.5 billion to finish building Mr. Trump’s border wall and even more money for immigration enforcement. It provides $150 billion for national defense priorities, including the Golden Dome missile defense system.
However, the more than $1 trillion in spending cuts in the Senate-revised bill divided Republicans and unified Democrats against the measure.
Democrats argued that funding cuts for essential health care and food benefits for the poor would pay for tax breaks for the wealthy.
“This bill represents the largest cut to health care in American history,” House Minority Leader Hakeem Jeffries, New York Democrat, said of the Medicaid cuts. “It’s an all-out assault.”
He delivered the longest-ever floor speech in the House at 8 hours, 44 minutes. He shared stories from Americans who would be impacted by cuts to Medicaid and food stamps, known as the Supplemental Nutrition Assistance Program, or SNAP.
Mr. Jeffries’ speech was just one in a series of delays.
House Republican leaders had hoped to pass the bill Wednesday, but negotiations with holdouts stretched into Thursday. They tried to maintain the pressure by holding open procedural votes on the bill and letting the clock tick.
After breaking a record with a more than seven-hour procedural vote Wednesday, the House held open a vote for nearly six hours on the rule to start debate.
“What are the Republicans waiting for??? What are you trying to prove???” Mr. Trump posted on social media in the middle of the vote.
The president then switched to all-capital letters to make his final point: “MAGA is not happy, and it’s costing you votes!!!”
The rule vote ended just before 3:30 a.m. Thursday, after enough of the holdouts had agreed to support the bill,
Fiscal hawks
Most of the final holdouts were members of the House Freedom Caucus who wanted more spending cuts. They were upset about various last-minute changes in the Senate, especially those that slowed the phaseout of clean energy credits after conservatives in the upper chamber had secured provisions to expedite their repeal.
The Freedom Caucus was particularly frustrated that Republican leaders broke a promise that the final bill would match every $1 of tax cuts with every $1 of spending cuts. The parties to this pact agreed to count $2.5 trillion in projected economic growth with the spending cuts, but for the bill to be at least deficit neutral, the tax cuts could not exceed that combined number.
The Freedom Caucus said the Senate bill adds at least $651 billion beyond that before the Senate made last-minute changes that further increased the cost.
Other than Mr. Massie, none of the so-called fiscal hawks who had concerns about the bill’s deficit impact voted against it.
The Freedom Caucus issued a statement after the vote touting a “historically unprecedented level of spending cuts,” about $1.5 trillion, that made it into the final bill.
“We remain determined to restore pre-pandemic federal spending levels, and there will be more developments on restoring fiscal sanity in the weeks to come,” the group said.
Freedom Caucus member Chip Roy, Texas Republican, said he supported the bill after securing “key wins from the administration to end the damaging Green New Scam subsidies, lock in substantial additional reductions in spending, and further assurances on how Medicaid will go to vulnerable Americans and not illegal aliens.”
“Celebrate today. Fight again tomorrow,” he said.
Mr. Johnson said he believes the holdouts moved because of detailed conversations with White House and Cabinet officials about how the legislation would be administered.
“I don’t think they exacted a lot of specific commitments or concessions or anything like that,” the speaker said.
Medicaid
More moderate Republicans were stressed about the steep Medicaid reductions that the Senate added and threatened to derail the bill, but they were mostly won over, save for Mr. Fitzpatrick.
Those lawmakers had concerns about the Senate’s more aggressive crackdown on provider taxes and state-directed payments, both financing systems for Medicaid. Republicans who support the crackdown say provider taxes are a “money laundering scheme” that allows states to funnel the tax revenue back to the same providers to inflate the amount of Medicaid funding the federal government must give.
“The original House language was written in a way that protected our community; the Senate amendments fell short of our standard,” Mr. Fitzpatrick said in a statement.
Although Republicans disagreed over some of the Medicaid provisions, they all supported new work requirements for able-bodied adults without dependents younger than 14.
The bill tightens existing work requirements for SNAP to align with the Medicaid requirements.
States with high SNAP payment error rates would have to start contributing 5% to 15% of food benefit costs, which are currently fully funded by the federal government. Those requirements begin in fiscal 2028, except for states with the highest error rates, which get an extra two-year delay, thanks to Sen. Lisa Murkowski, Alaska Republican.
In a hard-fought priority for House Republicans from Democratic-majority states, the bill would temporarily raise the cap on the federal tax deduction for state and local taxes, known as SALT, from $10,000 to $40,000. However, to appease Republican senators, none of whom represents a high-tax state, the cap would drop back to $10,000 in five years.
The measure would raise the debt limit by $5 trillion, extending the statutory borrowing room to ensure the government can continue paying its bills beyond August.
Mr. Trump has prioritized the debt limit increase in the filibuster-proof budget reconciliation bill so Democrats can’t use it as leverage to extract concessions from Republicans in exchange for their votes.
• Lindsey McPherson can be reached at lmcpherson@washingtontimes.com.
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