Debt ceiling raised by 5 trillion dollars+welfare cuts internal disagreements within the Republican Party blocked the “Big Beauty” bill

The Zhitong Finance App learned that US President Donald Trump lashed out at congressional Republicans through social media on July 3, pointing out that they were delaying signing the “Big Beautiful” economic bill he promoted, and issued a warning: if the bill is vetoed, the Republican Party will lose the support of the “Make America Great Again” (MAGA) core voters. This fierce game surrounding fiscal policy is pushing America's political polarization to a new level.

The turmoil stemmed from serious differences within the Republican Party over Trump's economic blueprint. Although House Republicans initiated the bill review process on July 2, the voting process stalled due to opposition from a minority of conservative lawmakers. The positions of these hawkish fiscal lawmakers rarely coincide with those of the Democrats, and they all strongly questioned the content of the bill. According to estimates by the non-partisan agency, the Congressional Budget Office, this comprehensive bill, which integrates tax cuts, spending cuts, immigration control, and energy policy adjustments, will push up US Treasury bonds by 3.4 trillion US dollars over the next 10 years, making the size of the federal debt exceed the 36.2 trillion US dollar mark.

The core provisions of the bill have sparked widespread controversy: on the one hand, continuing the 2017 tax reduction policy, cutting medical aid and food security spending, increasing the budget for border control operations, and abolishing a number of new energy subsidies; on the other hand, it demands that the debt ceiling be raised by 5 trillion US dollars, forcing Congress to reach a new agreement in the near future to avoid sovereign debt default. The Senate passed the bill by a narrow margin on July 1, but the House vote is still pending, and any amendment to the provisions will trigger a re-voting process in the Senate, which has brought the July 4 Independence Day legislative goal set by Trump almost to nothing.

Trump put pressure on the social media platform “Truth Social”: “This was supposed to be an easy vote for the Republicans. This delay is just ridiculous!” In particular, he stressed that supporters of the MAGA movement were “using their votes to express anger” because the bill was blocked. This pressure strategy reflects the White House's anxiety about moderates in the party: the Medicaid reduction plan has already triggered a backlash from some Republicans during Senate review, which ultimately forced the hospital to fund additional funding to reassure health institutions in rural areas.

The Democratic Party, on the other hand, launched an all-out attack on the bill. House Democrat Jim McGovern bluntly denounced during the debate: “This is not a policy; it's a blatant punishment!” Non-partisan analysis shows that the bill may cause about 10 million low-income people to lose their health insurance, while its tax reduction provisions suggest that 83% of the proceeds will go to the richest 1%. Democrats believe that at a time of crisis where federal debt has reached 120% of GDP, this bill is tantamount to “pouring gasoline into a burning house.”

The current impasse reveals deep rift within the Republican Party. Although Trump strengthened his control within the party after returning to the White House, the conflict between fiscal conservatives and populists remains acute. The Speaker of the House of Representatives had to keep voting channels open in an attempt to get anti-water lawmakers to change their minds through last-minute lobbying. This legislative marathon will not only test the unity of the Republican Party, but will also determine America's fiscal direction for the next ten years. Amidst the gap between the debt crisis and tax reduction promises, Washington's political arena is playing out the most dramatic power game.