| By Benjy Sarlin, Assignment Editor |
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| House Republicans advanced a tax bill last week that an independent assessment says would increase deficits by upward of $3 trillion over the next decade. A shaky bond market seems to be signaling that investors would like lawmakers to take long-term debt concerns more seriously. But this behavior from Congress isn’t new: The latest bill extends budget-busting tax cuts from Trump’s first term, which were followed by a $1.9 trillion pandemic stimulus package under President Joe Biden. I spoke to our columnists Jim Geraghty and Catherine Rampell about the growing national debt and whether the politics around it might change. 💬 💬 💬 Benjy Sarlin: How big a problem is the deficit in your eyes and how urgent a priority is reducing it? Jim Geraghty: The deficit is a very big problem, and a country with responsible leadership would prioritize reducing it. Alas, the electorate shows just about zero interest in higher taxes, lower spending, entitlement reform or any other serious steps to address it, and politicians have responded to those incentives by largely ignoring the increasing debt. Catherine Rampell: In the long run, the deficit is a huge problem. Our debts will have to be paid back at some point, in the form of higher taxes and/or lower spending. We’ve been able to skate these consequences thus far because the rest of the world is still willing to lend us money in huge sums. But at some point the chickens will come home to roost. The challenge is we don’t know when that will happen, and it could be a long ways from now — which is why the public and politicians have been shrugging off warnings from the usual deficit worrywarts. Jim Republicans strongly object to higher spending when Democrats control the appropriations process. When they’re running the show, not so much, as the “Big Beautiful Bill” demonstrates. Catherine: I sometimes think back to Jude Wanniski’s two Santa Clauses analogy from the [1970s]. Republicans were the tax-cut Santa Claus (give out goodies to the public in the form of lower taxes). Democrats were the spending Santa Claus (give out goodies in the form of more generous government programs). Today, both parties are both Santa Clauses. Jim: By the way, did you notice that Build Back Better and Big Beautiful Bill are both “BBB”? It is fitting, because that’s what America’s credit rating is going to be, at this rate. Benjy: Jim, you mentioned the electorate. Is it naive to think Democrats might run on cutting deficits in 2026 or 2028 if these issues persist? And, if so, what might a partisan Democratic plan to do that look like? |
Source Links: Prompt 2025 from The Washington Post
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