Planet Money The simple math of the big bill
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Jul 4, 2025 This discussion delves into the complexities of a massive tax and spending bill, revealing how it proposes significant tax cuts funded by cuts to Medicaid and growing national debt. The analysis uncovers the math behind these decisions, showing that the balance simply doesn’t add up. Listeners learn about the uneven benefits across different income groups and the implications for public services. There's a spotlight on the potential $3 trillion deficit impact and the broader economic ripple effects that could follow.
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Tax Cuts Favor the Wealthy
- The bill makes the large Trump-era tax cuts permanent, costing about $4.5 trillion over 10 years.
- The cuts mainly benefit wealthy households, especially those earning $460k to $1.1 million annually.
Tax Cuts Spur Minimal Growth
- Dynamic scoring accounts for economic growth effects from tax cuts but shows only modest growth.
- Growth offsets about 10% of the cost of the tax cuts; most of the deficit impact remains.
Major Medicaid Cuts and Provider Tax
- Medicaid cuts of about $900 billion come from tightening eligibility, notably work requirements.
- The bill also lowers the provider tax cap, reducing federal Medicaid funding to states by around $200 billion.