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What embarrasses me is that I never understood the mechanisms of Congress as much as I wanted. Over the past few weeks, I have worked hard to parse the incremental developments in Republicans’ “a big beautiful bill” – and in fact what they are saying now is to formulate most of President Donald Trump’s agenda. Usually, when I'm confused about Capitol Hill, I call my colleague Russell Berman for guidance. Yesterday, he published a story about "significant risks" (as economist Mark Zandi described), and the actions of the Republican Party in Congress could undermine the economy. I talked to him to find out where we are and how to know where we are going.
David A. Graham: Do I really need to pay attention to Congress?
Russell Berman: Yes, you do. While Trump has been around Congress in many ways, the Republicans are now debating a bill whose size and potential impact on the deficit are much bigger than anything you have seen in the past few years. The bill will extend Trump's tax cuts in 2017, with a cost of about $5 trillion. This will fund Trump's southern border plan. It will increase military spending. It may reduce or eliminate taxes on tips, overtime pay and Social Security benefits. It's a big question, it's a big question mark, whether and when it can be done, in large part because the Republicans can't agree on how to offset the $5 trillion price tag.
David: Remind me why it has to be a big and beautiful bill.
Russell: no. Senate Republicans initially wanted to provide Trump with his border funding and increase defense funding and save the tax cuts in Title II legislation. In the House, Republicans fear that this will pass one bill. Ultimately, Trump stands on the house side, but if they get stuck, the next step may be to break it down into multiple legislation.
David: Given how much control Trump seems to have over Congress, why can’t the White House tell them what to invest in the bill and pass it?
Russell: Trump is not very interested in Congress. Many times in the process, Republican leaders seek leadership again and again, and the president says again and again, Anyway, you all figured it out. They can’t figure it out, but they need to be in a deadlock to get Trump involved and use his political weight.
David: Where is the Democratic Party? Do they make any sense?
Russell: The short answer is no, because like Joe Biden's Democrats, Republicans are exploiting a process called a settlement that will bring them around the Senate lawsuit. Frankly, Democrats would be happy to sit down and throw darts from the outside.
David: Your story makes the choice here seem like success, threatening the economy, or tank (Tank) return Probably economic. Are there any other options?
Russell: The third option is to create a more fiscally responsible bill that would extend tax cuts but would offset them by cutting spending or increasing taxes elsewhere. But this is unlikely to pass because Republicans don’t like any form of tax increase, so what happens is usually just to reduce tax breaks. If this happens this time, economists tell me it could lead to more economic collapse. If the 2017 tax cuts expire at the end of this year, it would be a significant increase in tax revenue for everyone, as the economy could move towards a recession due to Trump’s tariffs — or have already fallen into a recession.
David: For those who strive to follow every turning point in this process, what can we pay attention to where we are going?
Russell: What we don't know is: Are they going to touch Medicaid? Will they be able to get these extra ace tax cuts in the bill? Will they be able to increase debt restrictions in this bill? If they don't increase debt restrictions, you'll have a disastrous default from the U.S. government, or spokesman Mike Johnson and Majority Leader John Thune have to go to Democrats say, Help us again.
David: It seems like a permanent warning of bad luck for Congressional Republicans to try to pass legislation, and every time Johnson pulls a rabbit out of his hat. Why is this different?
Russell: I wouldn't bet they pass a bill, but all these failure points are, if they're deadlocked on Medicaid, the particular nature of the tax cut, or whether to pay in full, this is where we can see things crash. They could turn to extended tax breaks, and nothing else would complete a large part of Trump’s agenda, but that would prevent tax increases.
David: And since they are using settlement, is this expecting that everything they don't pass now won't happen in Congress?
Russell: Suppose the president does have a year and a half because that's what you're going into the mid-term movement, anyway, it's hard to get through anything at that time. In this case, it is more concentrated as they have an imminent deadline for tax increases at the end of the year. It's indeed 2025 or bust.
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Breakfast is breaking
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Recently, breakfast stubbornly like myself noticed unsettling changes. In restaurants near me, a breakfast plate costs $11.50 in 2020 and $14, not just due to inflation. Although various foods have become more expensive in recent years, traditional breakfasts are particularly rough. The cost of eggs has soared. The shortage of supply has brought the prices of coffee and orange to an all-time high. And that doesn't even take into account President Donald Trump's tariffs…the staples that have made American breakfast so cheap for so long are now starting to explode.
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PS
Three weeks ago, I introduced North Carolina Supreme Court Justice Allison Riggs won her election last November with 734 votes, but her challenger Jefferson Griffin still hasn't won the championship because her challenger Jefferson Griffin is seeking to change the voting rules after the facts. Latest news about the story: Last night, a federal judge ordered the state election board to prove her as the winner, although he decided on a seven-day decision to allow appeal. This means that the final unresolved game in the United States may end soon, but not yet.
- David
Stephanie Bai contributed to the newsletter.
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