- Tax writer Schweikert: 2017 law’s extension needs more offsets
- GOP weighing scoring plan to renew Trump’s signature law
Permanently extending trillions of dollars of the GOP 2017 law’s expiring tax cuts would hike the
national debt to more than double gross domestic product over the next three decades, a new budget
scorekeeper report says, fueling the debate over and to what extent to pay for renewal.
Debt held by the public would reach 214% of GDP by 2054, assuming no other changes to fiscal policy
or interest rates, shattering previous records for the US. Adding the additional borrowing costs
would swell that figure to more than 250%, said the Congressional Budget Office, which didn’t
account for resulting “macroeconomic effects.”
The cost projections came at the request of Rep. David Schweikert (R-Ariz.), chair of the Joint
Economic Committee and a deficit hawk on the tax-writing House Ways and Means Committee. The latter
panel is drafting the Republican tax bill aimed at extending those cuts.
Schweikert in an interview argued the findings rebut congressional leadership’s “childish” efforts
to use a novel scoring method to permanently extend the expiring provisions of the 2017 law through
the budget reconciliation process.
Budget hawks in both parties have dismissed the maneuver, known as current policy baseline scoring,
as a accounting gimmick aimed at concealing the bill’s cost. But prominent Republicans like Senate
Finance Chair Mike Crapo (R-Idaho) are pushing it.
“The policymakers are going to have to make a decision, and in many ways it’s a moral one,”
Schweikert said. “Do they play to the short term, or do we do the long-term prosperity of this
republic?”
Republicans have argued that extending the tax cuts would boost economic growth, and as a result would generate revenue that would offset the cost of the cuts.
CBO acknowledged that while economic “growth would be faster in the first several years after the
extension of the tax provisions,” it would slow in the long term as interest rates rose.
“There’s no math that says” economic growth will negate the deficit impact an isolated extension,
Schweikert said.
Limiting the deficit impact of a permanent extension would “absolutely” require more offsets than
was outlined in House Republicans’ “anemic” budget resolution, Schweikert said. That framework,
which Schweikert voted for, called for $2 trillion in spending cuts in exchange for a full
extension of current tax law.
Democrats have sought to build political opposition to the tax package by raising alarm about cuts
Republicans could pursue to offset it.
Majority Forward, a tax-exempt advocacy group led by a former top aide to Senate Minority Leader
Chuck Schumer (D-N.Y.), announced Friday it would spend at least $1 million warning voters in
states critical to Republicans’ chances of keeping control of the Senate that the tax-and-spending
bill would come at the expense of working families’ benefits.
Democratic billboards targeting House Republicans with similar messaging were taken down when
threatened with a defamation suit. Some savings would have to come from Medicaid to comply with the
House GOP’s broader budget plan, CBO separately found earlier this month. Republicans have proposed
policy changes to the low-income health program and said they don’t plan to cut benefits.
Trump’s goal of balancing the federal budget “is fanciful thinking that is just a pretense for
harmful cuts in programs making it difficult for low- and middle-income families keep a roof over
their heads, food on the table, or access healthcare,” said Gbenga Ajilore, chief economist at the
Center on Budget and Policy Priorities.
By Zach C. Cohen 2025-03-21T11:13:32000-04:00
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