In the late hours of February 25th, House Republicans were able to pass a Budget Bill in line with President Donald Trump’s economic plans. While news outlets have been quick to examine the bill and its impacts on Americans, its effects can be difficult to grasp when lacking knowledge of the Budget process.
As described in the NCFC’s (National Volunteer Fire Council) fact sheet, the Budget process first begins after a new President assumes office. In this case, the procedure was put into motion after Donald Trump made his own Budget proposal, which is meant to determine how the government should be spending its money over the next 10 years. This plan addresses monetary issues such as the debt ceiling, tax cuts, and funding for government departments. After Trump finished his plan, a copy was sent to both the House and Senate. They both then edited Trump’s original proposition through the use of debate and compromise, amending it to better suit the likes of the whole Congress. Once the House and Senate adjusted the Budget to their taste, they both passed a separate Budget resolution, better known as the Budget Bill, like the one that was passed by the House on the 25th. This Resolution, while carrying weight, is meant to serve more as a blueprint than anything else, as a few weeks after both sections of Congress have passed their own Budget bills, the House and the Senate will come together to produce a finalized version that will go on to be signed into law by the President.
Despite sounding like a solid process, there are built-in factors that greatly affect the outcome of the Budget Bill. As CNN notes, passing a Budget Resolution does not require a majority of at least 60 votes to pass, unlike most other bills. Instead, a majority as slim as one person can pass a Budget Bill, making it a tool that majority parties in Congress have historically used to boost their agenda.
Thus, instead of the expected process of editing Trump’s original Budget proposal, House Republicans were instead able to keep most of his plans intact due to this voting loophole. Republican House Speaker Mike Johnson was adamant about leaving the President’s plans untouched when speaking with The New York Times: “This has been necessary because we promised to deliver President Trump’s full agenda, not just a part of it. We’re not just going to do a little bit now and return later for the rest. We have to do it now.” The lack of effort to accommodate Democratic wants in the Budget bill led to a slim 2-vote majority passing the House Resolution, with all Democrats voting against it.
The most eye-catching feature of the House’s proposed Budget is to cut billions of dollars in funds from services such as Medicaid and the Supplemental Nutrition Assistance Program or SNAP, as recorded by U.S. News. The main reason for such a large cut to these programs is due to the fact that the Budget orders 880 billion dollars to be slashed from the House Energy and Commerce Committee and 230 billion from the House Agriculture Committee, which each oversees Medicaid and SNAP respectively. This means that despite Trump stating, “Medicare, Medicaid – none of that stuff is going to be touched. We won’t have to,” it is virtually impossible to fulfill the government cuts the House Resolution outlines for these committees without decreasing the funding Medicaid and SNAP are given.
A study from USA Facts reveals that as of September 2024, 23.5 percent of Americans depend on Medicaid, and 11.7 percent receive food stamps from SNAP, meaning at the very least, one-fourth of the population would feel the effects of the proposed cuts. In an ABC News article, Penn State health policy professor Dennis Sheawords explains, “What that means then is, in order to live within that fixed Budget, you would have to find either individuals to cut out of the program or services that you would not provide to people in the program.” The piece later details what Medicaid services they believe to be on the chopping block. This would include general funding for hospitals, the coverage that 60 percent of Americans in nursing homes depend on, and affecting the overall state of medical care in rural areas.
Not only are medical facilities in rural counties already struggling to provide care with the current funding they receive, but in some of these areas, up to 50 percent of the residents receive some amount of insurance from Medicaid. Since G.O.P. officials are often the ones representing these districts, Republicans were wary when throwing their support behind the bill, as U.S. News reported that “…10 Republican-held districts have the highest percentage of Medicaid and SNAP beneficiaries who would be impacted by the cuts.” According to The New York Times, it took Trump personally speaking with Republicans who were still hesitant about the bill to get them off the fence, with all but one voting against the Resolution in the end.
Pulling funds from Medicaid and SNAP will also trickle into the general economy. AP macroeconomics teacher Mr. Barr helped to explain this: “In economics, we call those things transfer payments. So those are from the government, and it’s basically funds that are being transferred from the government to people who qualify for them.” He continued to say the goal of these payments “…is to try to lift up some people who are really struggling in the economy, and allow them to boost their consumption spending on other things…” This then means that if these programs do get pulled back, there is a possibility it could affect the larger economy, as not as many citizens will be able to contribute towards it.
Other government committees are also having their finances cut down, with CBS News listing that the Education and Workforce Committee, the Oversight and Government Reform Committee, and the Natural Resources Committee, will all have their Budgets lowered. There were also several committees awarded with more funds, most notably the Judiciary Committee receiving 110 billion, and Homeland Security reeling in 90 billion dollars. Despite it not being well known, the Judiciary Committee helps to oversee programs such as Immigration and Customs Enforcement (ICE), as well as other immigration-related programs. This goes hand in hand with Homeland Security, whose main job is related to border enforcement and security, which is very much in keeping with Trump’s campaign agenda of mass deportations. Consequently, these deportations will have significant economic ramifications. The Center for Immigration Studies attests that 18.6 percent of the US’s workforce is comprised of immigrants, both documented and undocumented, as of 2023. Mr. Barr described these economic ramifications by stating, “And so if the supply of workers decreases, employers are going to have to pay more to fill those jobs because there’s just gonna be fewer people who are willing to do them…they’re gonna have to pass that cost off onto somebody. Generally, the consumer.”
The other big headline in the House’s resolution is the order to cut 4.5 trillion in taxes. This is perhaps the broadest order of the whole bill, as it fails to mention who the cuts will be given to. Even though it seems many Republicans are banking on these funds being reserved for an extension on the Trump 2017 tax cuts, Politico has explained that there is not enough room in the Budget—even with the trillions of dollars up for grabs—to permanently extend them. The amount being given for these tax cuts is also up for debate, as an agreement in the House was reached that if Republicans cannot reach another monetary goal they set, reducing general government spending by two trillion dollars, the amount of money reserved for tax cuts will be lowered.
The next step in the Budgeting process will commence when the House and Senate come together to form the final Budget bill, which has been said to begin in late March. Congress has until early April to deliver a finalized bill, with most House Republicans expressing a desire to keep their current plan as untouched as the process allows. The Senate’s own Budget Resolution is highly similar to the House’s. NBC News detailed this likeness when explaining how the bill included the same request to increase funds for immigration and border security, as well as an identical 4.5 trillion dollar tax cut. This plan has begun to be viewed more as a backup in case the House’s Budget falls through, as it does not include some of the main cuts the House version proposes.
Despite it being difficult to tell what will happen when the House’s Budget bill makes its way into Congress, right now it seems as though Republicans hold all the cards. While their majority in Congress is slight, one vote can be enough for G.O.P. officials to pass whatever cuts or increases in funding they deem fit.