Six-Chart Sunday – Six, Big, Beautiful Charts

6 Infographics + 1 Video (Amazon's Echo Silver) + Upcoming live discussion (Chef Jose Andres)

This week House Republicans passed their massive reconciliation legislation 215-214 and sent it to the Senate. Upon returning from Memorial Day recess, the Senate GOP takes its turn, aiming to return an “improved” bill back to the House for July passage. Today’s charts look at several issues involved. As for the politics:

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1. There are Five Families but One Don. Smart Washington Post piece explaining how “the fate of Trump’s agenda rests with the House GOP’s ‘five families’,” the main factions within the House GOP. Of course in the end factional interests took a back seat to GOP fealty to the President.

2. Federal debt will grow. The Committee for a Responsible Budget (CfRB) concludes the House-passed bill would increase federal debt even faster than current law, rising to the highest level ever as a share of the economy (Chart: NYT).

3. Republicans say the problem is spending. CfRB calculates that future “revenue would total 17.3% of GDP under the plan as written (roughly the historical average) and 16.6% if extended.” Spending is projected to increase even more as a share of GDP going forward (note: chart below was based on CBO’s 2024 projections, not factoring in the House-passed bill, but story remains the same… spending grows faster than revenue & well-above historical average).

4. Democrats argue tax cuts are driving deficit growth, citing CBO’s estimate that “tax cut extensions would add $37 trillion to debt by 2054.” Republicans counter that failure to extend the 2017 tax cuts would increase taxes on 62% of taxpayers when rates reverted to pre-TCJA levels in 2026, slowing the economy.

5. Medicaid reductions. Medicaid cuts account for over $700 billion of the House bill’s ~$1.2 trillion in spending reductions over the next decade. Republicans argue such cuts merely revert to pre-pandemic levels and come from reducing fraud, requiring able-bodied recipients to work & removing support for illegal immigrants. Opponents fear that by “combining [these cuts] with the effect of the expected expiration of the ACA’s enhanced premium tax credits… 13.7 million more people will be uninsured in 2034.”

6. IRA green energy credits at risk. Per the NYT, “The party’s signature tax plan would kill most Biden-era incentives, but there’s a sticking point: G.O.P. districts have the most to lose.” The Tax Foundation quantifies savings: “the reforms and repeals would raise around $500 billion in revenue over the next decade.”

SO WHAT? Senators will make changes to the reconciliation legislation in June, but passage remains more likely than not as the White House continues to exert pressure. Expect furious lobbying to both reduce & increase spending cuts, shrink & grow tax relief, protect key in-state constituencies (e.g. employers, universities, hospitals, manufacturers) and advance key policy objectives (e.g. defense transformation, AI leadership, border security, energy dominance, economic growth). As they say, if you’re not at the table you’re on the menu. Enjoy the holiday weekend.

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Upcoming Live Discussion — CHEF JOSE ANDRES — Friday 5/30 at 11am ET

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VIDEO

One of the 5 funniest SNL parody product ads of all time… “Amazon partners with AARP on an Echo for seniors”…