Trump’s Budget Clash in Congress Signals a Disruptive New Era

Washington's fiscal cage match erupts as the 46th president's spending blueprint collides with Congressional reality.

Red ink meets resistance

The administration's trillion-dollar gambit faces bipartisan pushback—even from traditionally aligned factions. Treasury yields twitch as negotiators play chicken with the debt ceiling.

Executive power flex

White House lawyers dust off obscure budgetary maneuvers while Senate parliamentarians scramble to block them. Meanwhile, defense hawks and social program advocates discover rare common ground: opposing each other's pet projects.

Markets shrug (for now)

Wall Street's algo-traders barely glance up from their cocaine-fueled Bloomberg terminals—after all, what's another government shutdown between friends?

In brief

• On the eve of July 4th, Donald Trump gets a massive budget law passed in Congress amid a climate of high political tension.
• The text is narrowly approved by 218 votes to 214, despite reluctance in the Republican camp and unanimous Democratic opposition.
• The reform includes major tax cuts, elimination of the tipping tax, and an increase in the military budget.
• The Congressional Budget Office estimates that the law will increase the public debt by more than $3.4 trillion by 2034.

A high-tension adoption in Congress

Donald Trump’s budget law, source of sharp tensions with Musk, was officially approved narrowly 218 votes to 214 by the House of Representatives on Thursday, July 3rd, following a difficult vote in the Senate two days earlier.

This legislative victory, hailed as a “VICTORY” by the WHITE House on X, marks a political turning point for the American president, determined to impose his economic vision before the national holiday.

VICTORY: The One Big Beautiful Bill Passes U.S. Congress, Heads to President Trump’s Desk 🇺🇸🎉 pic.twitter.com/d1nbOlL21G

“This text brings together all the policies the president campaigned on and for which Americans voted on November 5,” said Karoline Leavitt, spokesperson for the executive. In a tense chamber, some Republican lawmakers chanted “USA, USA, USA!” at the end of the vote, illustrating militant fervor despite internal fractures.

To achieve this result, the executive faced strong resistance, including within the Republican camp. Several conservative lawmakers denounced the scale of the public debt generated by the text. In response to this deadlock, a series of political maneuvers were deployed :

• Donald Trump intervened personally and published on Truth Social : “MAGA is not happy, and that costs you votes” ;
• He made calls during the night to try to convince the resistant ;
• The Speaker of the House, Mike Johnson, led behind-the-scenes negotiations with direct help from the White House ;
• The vote, initially scheduled for Wednesday, was delayed following a nine-hour speech (historical record) by Hakeem Jeffries, Democratic leader in the House ;
• Only two Republicans voted against it, which allowed maintaining a fragile majority of eight seats.

Between tax gifts and social cuts

Behind the intense parliamentary battle, it is the very content of the budget bill that triggers a wave of outrage among opponents and growing concern among economists and some business leaders like Elon Musk.

Presented as the “big and beautiful law” by Donald Trump, this reform notably includes the extension of massive tax credits put in place during his first term, as well as the elimination of taxation on tips, a campaign promise that has become reality. To this are added increased military expenditures and an increase in the budget allocated to the fight against immigration.

However, this direction comes with significant cuts to social programs, fueling Democratic anger. According to the Congressional Budget Office, the text is expected to increase the debt by more than $3.4 trillion by 2034.

To partially offset this deficit, Republicans plan a drastic reduction of Medicaid, a vital program for millions of low-income Americans, as well as a significant cut to the SNAP program, the country’s main food aid.

Measures which, according to several analyses, will mainly benefit “the wealthiest households”, while millions of others could lose their health coverage or access to subsidized food.

These choices provoke sharp reactions within the Democratic camp. Hakeem Jeffries denounced a “repugnant monstrosity that will cause suffering to ordinary Americans”, while Gavin Newsom, governor of California, declared that “17 million people have just lost their health insurance”.

Former president Joe Biden, for his part, slammed the law as “not only irresponsible but cruel”, criticizing the “big tax cuts for billionaires”. While this reform fits into a strategy to stimulate the economy through tax reduction, its human and financial cost could fuel even greater political polarization ahead of upcoming elections.

This historic budget text, tailored to the vision of a strong and debt-free America through growth, risks producing contrasting effects. While financial markets and economic circles await a quantified impact, the social and political tensions it generates are already palpable. The reform could become a hallmark of the new TRUMP era but also a major crystallizing point for the opposition, as some believe it could ruin U.S. finances.

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