House Republicans released their long-awaited budget resolution Wednesday, a major step in starting to craft legislation to implement President Trump’s agenda — which will allow up to $4.5 trillion to be added to the deficit via tax cuts and look to cut $2 trillion in spending over the next decade.
The budget resolution also calls for a $4 trillion increase in the debt limit and up to $300 billion in additional spending for border security and national defense.
House Budget Committee Chairman Jodey Arrington (R-Texas) is planning to mark up the budget resolution Thursday, after Senate Budget Committee Chairman Lindsey Graham (R-SC) attempted to leapfrog the House with a hearing on his alternative budget resolution Wednesday.
A budget resolution is needed to unlock the Senate reconciliation process and enable Republicans to sidestep the 60-vote legislative filibuster.
The GOP intends to use the reconciliation process to wrangle through Trump’s sweeping agenda for tax cuts, immigration crackdowns, defense modernization, energy permitting reform and more.
But given the narrow Republican margin in the lower chamber, lawmakers have struggled to produce a specific plan — until now.
The budget resolution gives top committees leeway to make spending cuts, including $230 billion from the Committee on Agriculture, $330 billion from the Committee on Education & the Workforce, $880 billion from the Committee on Energy and Commerce and $50 billion from the Oversight Committee.
The $300 billion increase for military and border security in the budget plan includes $100 billion for the Armed Services Committee to earmark, $110 billion for the Judiciary Committee to give out and $90 billion for the Homeland Security Committee to distribute.
In order to commence the reconciliation process, the budget resolution needs to pass Congress. The House is set to adjourn on Thursday and will be in recess next week. Speaker Mike Johnson (R-La.) previously suggested he would not keep the lower chamber in session to force the resolution through.
Republicans have little room for error in the House, with their majority set to slip to one seat for the next several weeks until special elections are held to fill vacancies.
Frustrated by the slow pace of the House, Senate Republicans have almost universally preferred to split Trump’s agenda package into two different bills — with one covering the border, defense and energy and another dealing with taxes.
That would enable Republicans to get an early win and alleviate concerns about a lack of resources for border security. Hardliners in the House, such as members of the conservative Freedom Caucus, also prefer a two-track approach.
Graham’s plan — which was rolled out last week — did just that, with about $175 billion more for border security and $150 billion for added military spending over the next 10 years. Under the Constitution, the House has to act first on major tax changes, so if the Senate took the lead, it would have to be a two-bill approach.
There are limited disagreements among Republicans on the first tranche of the agenda package, but the tax component has proven more contentious.
House GOP leadership has argued that their task would become immensely more challenging if the bill was split in two because they’d have a lot less leverage to extract concessions from their members.
At times, Trump has expressed interest in “one big, beautiful bill” but at other times, he’s said something to the effect of “Whether it’s one bill, two bills, I don’t care.”
Last week, he huddled with top House Republicans in the White House for about four and a half hours as they attempted to develop a game plan.
The main goal on taxes is to extend the 2017 Tax Cuts and Jobs Act, which has some major provisions set to expire later this year.
Some estimates have indicated that extending those tax cuts would increase the deficit by between about $3.5 trillion and $3.9 trillion over the next 10 years.
Trump also wants the bill to fulfill his campaign promises of no taxes on tips, Social Security and overtime pay, which could add hundreds of billions to the deficit depending on the specific mechanics used.
Then there’s the demand from blue-state Republicans to increase the $10,000 cap on the state and local tax deduction (SALT). If bumped up to $100,000, the deficit could increase by about $134 billion over 10 years, according to an estimate from the University of Pennsylvania’s Wharton School of Finance.
Further complicating matters is the rapidly ballooning deficit, which topped $1.8 trillion last fiscal year.
Republicans have been struggling to figure out a way to make all of this work and satisfy enough of their members to get something through.
Johnson has conveyed optimism that Trump’s “big, beautiful” agenda package will clear the House by Easter, a timeline he’s clung to despite repeated delays.
The speaker is hoping to get the budget resolution passed through the House by the end of the month.
