Republicans Consider Lies to Hide Cost of Trump Tax Cuts

Senators Ron Wyden and Mike Crapo don’t see eye to eye about how to “score” tax cuts. Photo: Shuran Huang/The New York Times/Redux

Aside from the ongoing smash-and-grab operations by which Elon Musk and DOGE are seeking by fiat to create a federal government to their liking, the main drama in Trump’s Washington right now involves tortured efforts to make the fiscal arithmetic of his agenda add up to something other than a catastrophe. The single biggest problem facing congressional Republicans is how to find ways to pay for Trump’s tax-cut promises, which could add as much as $10 trillion to a national-debt burden they already profess to be intolerable. Yes, they can and will cut federal spending as much as the political market can bear and will hope to pocket any savings wrung from federal programs and personnel by DOGE. But it won’t be enough.

So Senate Republicans, who are particularly invested in Trump’s tax-cut agenda, are eyeing one very big gimmick — perhaps more accurately called a lie — to hide the cost, as NBC News reports:

Republicans are considering a far-reaching change to the budget process that would obscure the deficit impact of extending President Donald Trump’s multitrillion-dollar tax cuts in order to avoid paying for them.

It comes as part of a massive bill to advance Trump’s agenda that Republicans are seeking to pass on a party-line basis. If the tactic is successful, it would upend long-standing precedent and change the accounting process for current and future lawmakers, with major policy stakes.

Extending the Tax Cuts and Jobs Act, which Trump signed into law in 2017, would cost $4.6 trillion over a decade, according to the Congressional Budget Office, the official nonpartisan scorekeeper.

That’s under the “current law” metric that has traditionally been used, as the tax cuts are slated to expire at the end of this year. But Senate Republicans want to use a different scoring method called the “current policy” baseline, which would assume that extending tax cuts costs $0 because they’re already law.

In other words, close to half of the cost of Trump’s tax agenda would magically become free.

The argument that the 2017 tax cuts are baked into the cake of the federal budget is seductive, but there’s a big problem: When they were first enacted, they were made temporary in order to avoid busting the budget egregiously. They weren’t “free” then and thus cannot be “free” now. Extending them will, in fact, cost trillions of dollars more than letting them expire, which is exactly what current law provides.

The fiscal watchdogs of the Committee for a Responsible Federal Budget call changing the treatment of the tax cuts scheduled to expire “nihilistic, ahistorical, and inaccurate.” But the switcheroo sounds good to Republicans struggling to make the math work. In particular, the Senate Finance Committee, chaired by Mike Crapo of Idaho, is promoting the “current policy” scam because it makes his assigned task of bringing Trump’s tax agenda to fruition immensely easier. And though Democrats are howling about the deception (the Finance Committee’s top Democrat, Oregon’s Ron Wyden, called it “a phony, fake concept”), they may in their heart of hearts hope it happens in order to reduce the pressure for spending cuts.

Partisan opposition aside, there are multiple obstacles to the realization of this GOP scheme. Most important, the Senate parliamentarian could rule that it violates the “scoring” rules governing the congressional budget process. In theory, the Senate majority can overrule such decisions, but it rarely, if ever, happens and, in this case, stealth would likely be necessary to achieve a sudden multitrillion-dollar shift in the assumptions underlying the enactment of the Trump administration’s legislative agenda.

Another possible problem is that deficit hawks within the GOP could object to a cost-free package of tax cuts. The NBC News story on the scam quoted the ever-irascible Texas representative Chip Roy as saying, “I don’t like gimmicks, so I’m trying to wrestle with that.”

But perhaps the biggest problem with wishing away the costs of Trump’s tax cuts is that the real-world arbiters of fiscal matters and their impact, like the Federal Reserve Board and the financial markets, generally are not going to be fooled by it and could take countervailing actions to hedge against the presumably inflationary effect of more deficit and debt. Two plus two does not, in fact, equal nine, and pretending it does is a really bad idea, particularly when the goal is high-end tax cuts that aren’t popular anyway.