Unpacking the baseline battle over the 'big, beautiful bill' and the national debt
By Thérèse Boudreaux
The Center Square
Top U.S. Senate Republicans are eyeing a controversial accounting method to theoretically slash the multi-trillion-dollar price tag of President Donald Trump’s “big, beautiful bill.”
However, tax policy experts remain strongly divided over whether the tactic would constitute legitimate policy or a recipe for fiscal disaster.
The current version of the budget reconciliation package, entitled the One Big Beautiful Bill Act, passed the U.S. House on a razor-thin margin. The bill would give a 10-year extension to key portions of the expiring 2017 Tax Cuts and Jobs Act, raise the debt ceiling by $4 trillion, and fulfill Trump’s energy, border security and defense agenda.
Using the traditional current law baseline, House leaders calculated that the tax cut extensions would lead to an estimated $4.3 trillion in lost revenue over the next decade.
To help offset the cost, House committees included more than $1.7 trillion in savings in the package. They assumed that economic growth from the tax cut extension would cover the rest, though the Committee for a Responsible Federal Budget estimates the bill would still add at least $3.1 trillion to the national debt by 2034.
But Senate leaders want to make the tax cuts permanent, which, under the traditional current law baseline understanding, would increase the federal debt and deficit.
As a result, lawmakers are planning to use the current policy baseline to score their portion of the bill instead, which would treat the tax cut extension as a continuation of current law rather than new policy, theoretically zeroing out the cost.
In a recent statement, CRFB President Maya MacGuineas called the plan “nothing short of a fiscal failure.”
“The problem with the use of a current policy baseline in this bill is that they are using it to extend provisions originally scored under current law back in 2017 to bring down their score,” MacGuineas said. “This two-step would allow policymakers to avoid ever acknowledging the deficit impact of the TCJA for 2026 and beyond.”
The unprecedented move would not only pave the way for tax cut permanence but also allow the Senate to tack on an additional $1.5 trillion in spending to the bill for other wishlist items.
The White House fully endorsed the method Thursday, with White House Deputy Chief of Staff Stephen Miller calling the dire estimates from the Congressional Budget Office and others a “ludicrous theory” in multiple social media posts.
“Private money yet to be earned does not ‘belong’ to the government,” Miller said. “CBO says maintaining *current* rates adds to the deficit, but by definition leaving these income tax rates unchanged cannot add one penny to the deficit.”
Multiple Republicans in both the House and Senate have pledged to oppose a final bill that operates under current policy baseline or lacks additional spending cuts. Under the budget reconciliation process, Senate Majority Leader John Thune, R-S.D., needs only a majority vote for the One Big Beautiful Bill Act to pass.
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