GOP Budget Set to Skyrocket Deficit by a Staggering $5.8 Trillion, New Analysis Reveals

The nonpartisan Committee for a Responsible Federal Budget (CRFB) has issued a stark warning about the impending budget resolution set to be adopted by Republicans later this month. Their analysis indicates that this resolution could potentially add up to $5.8 trillion to the federal deficit over the next decade.

According to the CRFB, the reconciliation instructions tied to this budget will enable GOP lawmakers to propose legislation that could surpass the deficit impacts of several major laws from recent administrations. Their report highlights that a bill with a $5.8 trillion deficit impact would be unprecedented. It would exceed the deficit increases attributed to significant bipartisan legislations such as the infrastructure law, American Rescue Plan, CARES Act, and the 2017 Tax Cuts and Jobs Act combined.

This dramatic fiscal impact could effectively equate to establishing a large new welfare program within the federal budget, as pointed out by the CRFB.

To advance their agenda, Republicans in Congress are aiming to adopt a budget resolution that allows them to utilize a complex reconciliation mechanism. This would enable them to implement key campaign promises without requiring Democratic support to overcome the Senate’s 60-vote filibuster threshold.

The anticipated primary driver behind the projected increase is an extension of the 2017 GOP tax law, which could contribute approximately $4.5 trillion to the deficit. Additional modifications to the U.S. tax code could bring that total to around $1.5 trillion.

While House Republicans are exploring ways to mitigate the overall deficit increase—aiming to cut about $1.5 trillion in federal spending—the specifics of how to achieve these cuts are still under negotiation.

Concerns have arisen among centrist Republicans regarding proposed spending cuts calling for at least $880 billion from the Energy and Commerce Committee, which oversees Medicare and Medicaid. Achieving this level of cuts would likely require significant reforms to these vital programs.

GOP leaders and former President Donald Trump have consistently indicated that Medicare will remain untouched, suggesting that Medicaid—affecting lower-income individuals—might face the brunt of any cuts.

In the Senate, Republican leaders have set a far lower threshold for spending cuts, requiring only a minimum of $4 billion from four different committees over the 10-year budget cycle. The reconciliation opportunities proposed would be nearly as expansive as the largest federal spending programs.

The implications of a $5.8 trillion increase in deficits stand vast. It could account for over three-quarters of projected Medicaid spending, 69 percent of baseline defense spending, and half of all net spending on Medicare during the same period.

CRFB has urged Congress to reconsider its approach. They advocate for a fiscally responsible budget package that would not only curb borrowing but also lay the groundwork for a sustainable economic outlook.

A vote in the Senate is anticipated this weekend to approve the budget resolution before sending it back to the House for final consideration. Following successful votes in both chambers, Congress will commence drafting, debating, amending, and ultimately voting on the reconciliation package.