The Great Budget Baseline Con
What debt? Creative accounting makes it go away. Jul 11 2025Republicans now face the dicey task of persuading their voters that the "One Big Beautiful Bill" they've just passed is anything of the sort. Deeply unpopular, Fox News and Quinnipiac polls show an average of 57% of voters are opposed to the OBBB, with only 34% in favor. And when told that it could add $3.5 to $4.0 trillion to the national debt over the next 10 years while cutting $800 billion from Medicaid at a cost of 8-10 million people losing medical coverage, all to preserve the 2017 tax cuts that benefit the wealthy, support of even MAGA Republicans plunges 10% or so in polling. And wait until they discover that no taxes on tips, no taxes on overtime, both have limits, and together with the quadrupled state and local tax deductible, all expire in just three-and-a-half years at the end of Trump's term.
So what are Republicans to do? Step one, attack their own Congressional Budget Office which has always been the go-to source for non-partisan analysis. Several op-eds dug into historical examples of when the CBO got it wrong. "The CBO has a terrible track record of predicting health insurance losses", says the arch-conservative Washington Examiner's editorial board. "Most importantly, the CBO report ignores the macroeconomic damage that would result from rejecting the OBBB." Well, of course. The CBO Is not evaluating what didn't happen.
accounting skullduggeryBut surely the most desperate dodge Republicans have come up with to enshroud the huge addition to U.S. debt they have enacted is to argue that they haven't cut taxes at all. The tax rates and standard deduction are the same as in the 2017 Tax Cuts and Jobs Act. Nothing changes. We just continue as before. So that's declared the new "baseline". So if they haven't cut taxes other than a few extra giveaways (no taxes on tips, overtime, etc.), the OBBB doesn't add to the debt at all!
But wait a minute. President Trump says "Senate Republicans are voting for the largest tax for middle-class Americans in history.” At a dinner with Israel's Prime Minister Netanyahu July 7th he called them, "the biggest tax cuts ever". How can they be the biggest tax cuts ever if taxes aren't changing? (Also, they're an extension of the 2017 tax cuts, which he at the time called the biggest tax cuts in history, so he's double-counting.) Trump says, “After this kicks in, our country is going to be a rocket ship economically.” But what's changed to suddenly spur the economy?
The 2017 TCJA was passed by Republicans under "reconciliation" rules that require only a 51% majority in the Senate for bills that deal only with financing the government. But they are temporary; they expire after ten years. Some sooner. Expiration would restore the higher pre-2017 tax rates. The $4.5 trillion in revenue to the government that would add in the coming decade would wipe out the $3.5 to $4.0 trillion increase in the nation's debt caused by extending the TCJA.
But now Republicans speak of the reversion, required by the rule they agreed to in 2017, as the biggest tax increase in history. Trump hallucinated about the bill that "if it's not approved, your taxes will go up by 68%". That's either a preposterous lie or something's amiss with his mental acuity. Comparison of tax tables then and now say more like 7%. He also continues to say "no tax on Social Security". Seniors just get a reduction.
town halls not recommendedAccordingly, Republicans back in their home districts will have to argue simultaneously that the Act is a monumental, historic tax cut that benefits everyone but doesn't add to the deficit at all because the new baseline says there is no tax cut. Golly, in fact, when you wipe clean any notion of pesky debt increase, the OBBB magically becomes a $508 billion deficit decrease.
Even the usually sober Wall Street Journal is party to the hoax. An editorial sloughs off the CBO $3.5-$4.0 trillion debt increase because "it's only true if you assume that Congress was going to tolerate a $4.5 trillion tax increase." They are saying that because allowing expiration of the 2017 Act and reversion to the status quo ante was off the table — "Congress was never going to allow that" — there is no debt increase because there is no revenue increase to measure it against. So the editors adopt the new baseline that makes tax extensions "free". The CBO "scores" legislative proposals against "current law" and current law before passage of the OBBB was that the reconciliation bill of 2017 would expire and revenue would increase. But the Journal says, "In any rational world, changes in the law would be scored against current policy" (emphasis ours). Policy trumps law.
The Journal's news pages disagree. One day earlier an article began,
"Republicans waved a $3.8 trillion magic wand over their tax-and-spending megabill, declaring that their extensions of expiring tax cuts have no effect on the federal budget."
The reporter quotes Senate Minority Leader Chuck Schumer (D-NY):
“Republicans are doing something the Senate has never, never done before — deploying fake math and accounting gimmicks to hide the true cost of their bill.”
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