What's next for Trump agenda after House GOP approves tax breaks and
slashed spending in budget
 [February 27, 2025]
By LISA MASCARO, KEVIN FREKING and LEAH ASKARINAM
WASHINGTON (AP) — Now that House Republicans have passed an ambitious
budget blueprint for President Donald Trump's agenda, it’s time for the
hard work of turning ideas for $4.5 trillion in tax cuts and $2 trillion
of slashed spending into a bill that lawmakers warn could bring intense
changes to Americans back home.
Republicans are insisting the costs of the tax breaks be partly paid for
by the steep reductions in federal government spending as a way to
ensure the nation's $36 trillion debt load doesn't balloon to dangerous
levels.
But deciding what to cut — health care, food stamps, green energy,
government regulations or student aid — is a politically agonizing
choice.
And it's not just the House that has to agree. GOP senators have their
own plans. Their priority is to make the tax cuts permanent, rather than
have them expire in a decade, as the House proposed. GOP senators see
that as non-negotiable, but it would skyrocket the costs.
Eventually, the House and Senate must vote on a final package.
“We have a lot of hard work ahead of us,” House Speaker Mike Johnson
said after the late Tuesday vote.
It's the start of a weeks-long — if not months — slog that is expected
to consume Congress as Republicans try to deliver on Trump's agenda and
their own campaign promises.
Trump met Wednesday with Johnson and Senate Majority Leader John Thune
at the White House, after Republicans also met with Treasury Scott
Bessent. Trump's chief of staff Susie Wiles huddled privately with GOP
senators at the Capitol.
Republicans say if they fail to act, the lower tax rates first approved
in 2017 will expire, which would amount to a massive tax hike for many
Americans. They believe keeping the tax cuts in place will partly pay
for themselves, unleashing economic growth and fresh revenues, though
others say those projections are optimistic.
Democrats put up stiff opposition against the House GOP plan — one
lawmaker dashed from California after a week’s stay in the hospital and
another returned to Washington for the vote with her newborn son.
Democrats will spend the weeks ahead warning Americans what's at stake.
“Republicans and Trump promised to lower costs on day one, and instead
their priorities have been focused on ripping health care away from
kids, moms and others who need it most,” said Brittany Pettersen, D-Colo.,
cradling her 4-week-old son, Sam.
“All to fund tax breaks for billionaires like Elon Musk while increasing
our national deficit by trillions of dollars," she said. "How can anyone
show their face in their district after voting yes for this?”
Trump, during a freewheeling Cabinet meeting Wednesday at the White
House, insisted he will not touch the nation's premier safety net
programs — Medicare, Medicaid and Social Security — but seek ways to
root out what Republicans call waste, fraud and abuse.
“It won’t be ‘read my lips’ anymore,” Trump said, echoing President
George H.W. Bush's no new taxes pledge. “We’re not going to touch it.”
But the math doesn't fully add up.
Without steep cuts to federal programs, Republicans won't be able to
claim the savings they need to offset the costs of the tax breaks. And
without offsetting the costs, conservative GOP lawmakers won't want to
vote for the final package.
After the White House meeting, Johnson said Trump's tariff policies and
his new plan for $5 million gold cards for immigration “will change the
math” as the lawmakers get down to work.
Johnson said he, too, wanted to make the tax cuts permanent. “That's our
goal.”
Now that the House has acted, it’s the Senate’s move.
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Senate Majority Leader Sen. John Thune, R-S.D., speaks to reporters
after a Senate policy luncheon, at the Capitol in Washington,
Tuesday, Feb. 25, 2025. (AP Photo/Ben Curtis)
Thune said it’s “to be determined” when the Senate would act. “It’s
complicated,” Thune said. “It’s hard. Nothing about this is going to
be easy.”
Initially approved during Trump's first term, many of the tax cuts
were temporary and are expiring later this year. Keeping them would
cost $4.5 trillion over the next decade.
And that's not counting the new tax cuts that Trump is asking for.
The president wants to eliminate taxes on tips, which was a
signature campaign promise, and has also talked about getting rid of
taxes on overtime pay as well as Social Security benefits. Those
would add to the price tag.
As GOP senators insist on making the tax cuts permanent, one idea
supported by the Senate Budget Committee Chairman Mike Crapo of
Idaho is to simply use a different accounting process.
It involves essentially treating the tax cuts as what’s called
“existing policy,” which would mean they are not a new cost, and
therefore would not need to be offset by cuts elsewhere.
Thune backs the idea, though it has run into resistance from other
Republicans, including conservative House deficit hawks.
But Oregon Sen. Ron Wyden, top Democrat on the Finance committee,
said Republicans are engaging in “funny math.”
“It’s all a big game in order to get more money to the billionaires
through their tax breaks,” Wyden said.
With reductions to the Pentagon off the table, Republicans are
hunting for cost-cutting across the non-defense side of the budget.
The next biggest pot of money available is the nation's health care
programs.
The House GOP's bill directed the committee that handles Medicaid
health care spending to come up with $880 billion in savings over
the decade, which would be the bulk of what's needed to offset the
cost of the tax breaks.
Republicans insist there will be no direct cuts to people who
receive their health care through Medicaid, some 80 million adults
and children, and that they only will target waste, fraud and abuse
to make it more efficient.
Mostly, Republicans talk about imposing work requirements or
removing able-bodied men from the government-run Medicaid program.
Doing that would save a small portion of what's needed, some $100
billion over the decade.
For bigger savings, Republicans consider altering the way the
federal government provides Medicaid money to the states. Some 40
states expanded their Medicaid programs with the Affordable Care
Act, when Obamacare provided money to enroll people in the program.
The Republicans have also directed the House Agriculture Committee
to come up with some $230 billion in savings. One likely place it
will turn is the Supplemental Nutrition Assistance Program. GOP
chair Rep. Glenn Thompson of Pennsylvania said food stamps won't be
cut.
Democrats are having none of this, and advocacy groups have started
showing up at town hall meetings to protest what's happening.
At the same time, key GOP senators are still pushing their smaller
$340 billion package to provide the Trump administration with money
it needs for border security and its mass deportation agenda. Their
idea was to include the tax cuts in a second package later in the
year.
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