Tuesday, July 1, 2025

The One Big Beautiful Bill: Disinvesting in the Common Good

The so-called “One Big Beautiful Bill” (BBB), championed by Donald Trump and Republican leadership, is being marketed as a pro-growth, pro-taxpayer reform bill. In reality, it reflects a massive upward redistribution of wealth, a dramatic weakening of the federal government’s ability to function effectively, and a serious threat to the long-term health of the US economy. The bill’s impacts—financial, social, and institutional—should raise alarms for all Americans who value fiscal responsibility, equal opportunity, and economic sustainability.

Regressive Distributional Impacts

The most immediate and visible effect of the BBB is its regressive impact across income groups. Like the 2017 Tax Cuts and Jobs Act (TCJA) before it, the BBB extends and expands tax cuts that disproportionately benefit high-income earners and corporations. According to the Congressional Budget Office (CBO) and the Tax Policy Center, the top 10% of earners stand to gain thousands—sometimes hundreds of thousands—of dollars per year, while low-income households lose out due to deep cuts to safety-net programs.

 

CBO estimates that the lowest-20% of earners could lose approximately $1,600 annually, or nearly 4% of their disposable income. These losses stem not from tax increases, but from reduced access to Medicaid, SNAP, housing assistance, and other federal supports. Meanwhile, high-income households benefit not only from the continuation of the Trump-era tax breaks, but also from weakened IRS enforcement, which makes tax avoidance easier for those with the means to exploit complexity.

Targeting the Most Vulnerable

Perhaps the most troubling feature of the BBB is its direct harm to society’s most vulnerable groups: the elderly, disabled, veterans, low-income families, and children. By stripping billions from Medicaid and nutrition assistance programs, the bill threatens health coverage for millions, while reducing food security and basic supports for families with children.

This is not speculative. The CBO projects that up to 11 million people could lose Medicaid coverage under the bill. Additional analyses show that repeal of the expanded Child Tax Credit could push hundreds of thousands of children back into poverty. For veterans who rely on means-tested VA or Medicaid services, the effects could be particularly harmful.

Undermining the IRS and Revenue Collection

The bill’s repeal of most of the IRS funding boost enacted under the Inflation Reduction Act is another serious blow—one that harms fiscal integrity and benefits wealthy tax avoiders. The Treasury Department had projected that investments in IRS enforcement would return $4 to $7 for every $1 spent, primarily by ensuring compliance among corporations and high-income filers. Rolling back these investments will likely cost the government $200–$280 billion in lost revenue over the next decade.

Weakening the IRS undermines the fairness and efficiency of our tax system. With fewer audits of complex returns and reduced capacity to pursue fraud, compliance will fall, and confidence in the system will erode. Meanwhile, honest wage-earners—whose taxes are automatically withheld—will shoulder a growing share of the burden.


Threat to Social Security and Long-Term Economic Stability

While the BBB does not directly cut Social Security, it adds $3–4 trillion to the national debt over the next decade, according to CBO estimates. That debt will limit policymakers’ ability to shore up Social Security as it approaches insolvency—now projected between 2033 and 2035. The issue of Social Security solvency could be solved by a stroke of the pen; raise or eliminate the cap on earnings subject to social security taxes. 

If no action is taken, retirees will face automatic 20% benefit cuts. The BBB reduces the government’s fiscal capacity to prevent this outcome, while simultaneously making benefit reductions for younger and middle-income Americans more likely in the future. Moreover, the rising debt—already at $36.2 trillion—is being fueled not by public investment, but by tax cuts tilted toward the wealthy. As interest payments rise and economic growth slows, the government’s ability to respond to future crises—economic, environmental, military, or public health—will diminish.

Economic Risks: Short-Term Boost, Long-Term Drag

While some economic growth may follow from tax cuts and deregulation in the short run, the long-term effects are grim. The CBO and independent economists expect only modest and temporary GDP gains—on the order of 0.3–0.5%—not the transformational growth promised by proponents. Meanwhile, deficits remain high, investment is crowded out, and the bill’s structure favors buybacks and capital hoarding over job creation or productivity.

Indeed, the post-2017 TCJA years offer a cautionary tale: despite enormous corporate tax relief, job growth and wage increases were modest, and corporations overwhelmingly prioritized stock buybacks over new investment. There is no reason to expect a different outcome under BBB.

 

Looking at the big picture, what's perhaps most alarming is the bill’s effect on the cost of servicing the national debt. Interest payments already consume nearly 14% of federal outlays—more than we spend on children, housing, or transportation. With the BBB projected to add $3–4 trillion in new debt, CBO estimates hundreds of billions in added interest costs over the next decade. This money buys nothing—no new services, no benefits—only the privilege of paying bondholders. As interest consumes more of the federal budget, it will leave even less room for investment in the nation’s future and raise the political pressure to cut deeply into essential programs like Social Security, Medicare, and veterans’ services.

Conclusion

The “One Big Beautiful Bill” is not a pro-growth strategy—it is a policy of disinvestment from the whole of theAmerican people. It is a policy that abandons the idea of "a more perfect union." It is a policy that deepens inequality, hollows out public institutions, strips protections from the vulnerable, and mortgages the country’s future for the benefit of the wealthiest few. If passed, it would mark a retreat from the postwar consensus that prosperity should be broadly shared and that government has a role in safeguarding the common good. This bill disinvests in the common good.

Americans concerned with fairness, fiscal sanity, and long-term economic strength should see the BBB for what it is: a short-term political win for some, and a long-term crushing loss for the country.

 

Sources

CBO estimate of BBB impact on debt:
CBO Dynamic Score of Senate BBB, May 2025
 (Adds ~$3.9 trillion to debt by 2034)

Distributional impacts:
 Tax Policy Center, May 2025
 CBO analysis summary via Investopedia

Medicaid coverage losses:
[CBO and Kaiser Family Foundation, 2025]

IRS enforcement ROI:
 [U.S. Treasury Estimate, 2022] – $4 to $7 return per $1 invested.

Social Security insolvency projection:
[2024 Social Security Trustees Report] – Trust fund depletion between 2033 and 2035.

Interest as % of outlays:
[CRFB and CBO projections, 2024–2025] – Interest is ~14% of federal outlays in FY2024.