By Siobhan Hughes, Richard Rubin and Lindsay Wise
WASHINGTON -- President Trump's "big, beautiful bill" squeezed through the House after a late scramble to get rival factions on board. Next it goes to the Senate, where GOP lawmakers are already making demands and party leaders will once again need to bridge sharp disagreements.
The more than 1,000-page bill passed the House early Thursday morning after Speaker Mike Johnson (R., La.) found a recipe that satisfied just enough lawmakers, approving the measure by just one vote after an all-night session. Now Senate Republican leader John Thune needs to line up enough support within his own narrow majority -- without making changes that fracture the fragile House agreement and derail the party's hopes to finish the bill by its July 4 target.
Senate Republicans are split. Some are eyeing further spending cuts, while others are looking for bigger tax relief or gentler phaseouts of clean-energy incentives. Hard-fought House sweeteners such as the higher cap on state-and-local tax deductions could face scrutiny. Any changes in the Senate would then have to be approved by the House before heading to Trump's desk.
"I don't suspect we'll tear the whole thing apart, but we're probably going to repaint some of the interior walls," said Sen. Markwayne Mullin (R., Okla.). "We've got to put our fingerprints on it."
The House bill is a catchall container for Trump-era GOP policies. It extends expiring tax cuts, adds versions of the president's pledges to remove taxes on tips, overtime pay and Social Security benefits, and provides new money for border security and defense. It cuts into Democratic priorities such as Medicaid, food aid and higher education.
In all, the bill is expected to increase budget deficits by $2.7 trillion through 2034, compared to doing nothing, though a final official estimate wasn't available.
GOP leaders on both sides of the Capitol stayed in close contact while House members wrote their legislation, hoping to avoid bitter fights that could derail the bill. And top House Republicans, including Johnson, warned Thursday against major changes in the Senate.
"A lot of work went into this to find exactly the right balance," he said. He encouraged Senate colleagues to "think of this as a one-team effort" and modify the bill as little as possible.
Thune said senators were "looking at what the House did, and we've had a lot of conversations with our members." He called it a "very active discussion."
Some GOP senators want to try for deeper spending cuts, even as Senate Republicans also insist that some tax cuts temporarily extended by the House be made permanent. Budget hawks pointed to the move by Moody's Ratings this month to strip the U.S. of its final AAA credit rating, saying it showed the need for further deficit reductions.
"Our debt is becoming a vulnerability," said Sen. Kevin Cramer (R., N.D.). "I really think that vulnerability is being exposed, and I think it's sort of a license to get something done."
At the top of the list for some lawmakers are deeper cuts to Medicaid, the state-federal program that insures low-income Americans. Senators might also try to revise a House deal that raises the cap on the deductions for state and local taxes to $40,000 from the current $10,000. That agreement secured crucial votes from House members in high-tax states such as New York and New Jersey, but SALT has no clear champion among Senate Republicans.
"Why are we subsidizing New York's and California's property taxes?" said Sen. Rick Scott (R., Fla.).
At the same time, individual Republican senators will also try to protect home-state priorities, such as renewable-energy projects whose planning would be upended by a provision in the House-passed bill that would rapidly phase out tax credits.
"If millions or billions of dollars have been deployed, we've got to give those businesses some off-ramp that's not devastating," said Sen. Thom Tillis (R., N.C.), comparing renewable energy projects to the partially built Keystone XL oil pipeline, whose costs were never recovered after former President Joe Biden revoked its permit.
"Not only is it that stranded capital, but it's the chilling effect that it has on future investments," said Tillis, who is running for re-election in a crucial swing state next year.
Senate Minority Leader Chuck Schumer (D., N.Y.) said the House bill would effectively kill all clean-energy projects in the country, and predicted that Republicans would pay a price at the ballot box.
"Given what the House passed last night, it's going to be a lot easier for us to take back the Senate," Schumer said. "In these red states, there are going to be tens of thousands and hundreds of thousands of unemployed people," Schumer said, holding up a map.
As in the House, Senate Republicans can lose only three of their own members if all Democrats are opposed, and already they are closing in on that number.
Sen. Rand Paul (R., Ky.) opposes the legislation's multitrillion-dollar increase in the federal borrowing limit, saying that makes him a hard no. Sen. Ron Johnson (R., Wis.) has been arguing to break the bill into several pieces, separating tax-cut extensions from spending cuts and other priorities.
Medicaid is the biggest target for cost cutting. The House bill reduces federal Medicaid spending by increasing eligibility checks, imposing work requirements on most able-bodied adults through age 64 without dependents, and reducing federal Medicaid payments to states that provide healthcare coverage for immigrants in the country illegally.
In a last-minute change designed to get the bill across the finish line, the House bill speeds up the start of the work requirements to December 2026 from 2029. A preliminary CBO estimate of an earlier version of the bill found that it would reduce the number of people with health insurance by at least 8.6 million in 2034.
Sens. Josh Hawley (R., Mo.) and Jim Justice (R., W.Va.) have raised concerns about the proposed spending reductions.
"We want to make sure we get Medicaid right -- no Medicaid benefit cuts, " Hawley said.
But other senators are seeking more savings and want to take a look at the mechanism that states use to boost the costs of Medicaid born by the federal government. That arrangement, in which most states impose taxes on hospitals, nursing homes and other facilities as a way to generate Medicaid funds that then attract federal matching dollars, is seen by critics as a scheme that has bloated federal deficits.
"That is allowing states to game the system, literally steal from the federal government," said Johnson, the senator. "The provider taxes, the provider fees -- it's a scam, it's money-laundering."
The federal matching rates are especially generous for the population that gained Medicaid coverage since the 2010 Affordable Care Act, which allowed states to cover low-income, able-bodied adults with the federal government picking up 90% of the cost. Previously, the program was mostly limited to poor pregnant women, mothers and their children, and the disabled.
Rep. Jason Smith (R., Mo.), the chairman of the House Ways and Means Committee, said he expected the Senate bill to be 90 to 95% similar to the House version, noting that he often talks with his Senate counterpart, Mike Crapo (R., Idaho).
He said the Senate needs to move carefully when it makes changes, including on such issues as the SALT cap that were key to House passage.
"If we can't pass it in the House and agree in the Senate, we won't have a bill," he said.
Write to Siobhan Hughes at Siobhan.hughes@wsj.com, Richard Rubin at richard.rubin@wsj.com and Lindsay Wise at lindsay.wise@wsj.com
(END) Dow Jones Newswires
May 22, 2025 16:27 ET (20:27 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
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