Tags: 2024 | election | tax | cuts | aca | deficit | congress

Next President Faces $4 Trillion Problem

By    |   Monday, 26 June 2023 10:12 AM EDT

The next U.S. president will face a near $4 trillion problem.

That's because $3.6 trillion in tax cuts and $350 billion in Affordable Care Act (ACA) subsidies are expiring, not to mention the debt limit will need to be addressed again, the Committee for a Responsible Federal Budget reported.

Extending these tax and health provisions in their entirety would cost roughly $4 trillion from fiscal year 2026 through fiscal year 2035.

The results of the 2024 election greatly will affect how the eventual legislative solutions evolve.

"We're in a time period in the country where we're just so deeply polarized, and compromise or actually legislating is not rewarded," Chris Campbell, a longtime aide to former Utah Republican Sen. Orrin Hatch, told Axios.

"When I was up there, I could have easily mapped out how this would happen … now it's really uncertain. It really will depend on who the president is, and it will depend on the margin of either the House or Senate."

The recent debt limit battle showed that Democrats and Republicans, even amid a crisis, struggle to come to an agreement in the current political environment.

The GOP's 2017 tax law and the enhanced ACA subsidies that Democrats initially passed in 2021 — both signature policy accomplishments — became law under party-line votes and are extremely polarizing.

Even one-party control of Congress and the White House won't guarantee relatively quick legislative agreements.

According to an analysis by the Committee for a Responsible Federal Budget, the country's debt level will continue to rise over the next two years and thus force Republicans to choose between raising taxes and cutting another $3.6 trillion.

"I think there will be a faction of the Republican Party who would not want to go into a debate, even with significant tax cuts, if it would blow a hole in the deficit," Campbell said, Axios reported.

Democrats, meanwhile, would happily extend the ACA subsidies, but raising taxes likely would be a difficult political sell.

"It could potentially be a really good deal for Democrats if they were to agree to extend the tax cuts and extend the ACA subsidies. Then they don't get blamed for raising people's taxes and they get the subsidies," former House Budget Committee Chair John Yarmuth told Axios.

Budget hawks suggest that letting at least some policies expire or finding a way to pay for extensions would be the responsible course of action.

Or, temporary extensions could bring down the near $4 trillion price tag. But that would pass on the cost to future generations.

© 2024 Newsmax. All rights reserved.


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The next U.S. president will face a near $4 trillion problem. That's because $3.6 trillion in tax cuts and $350 billion in Affordable Care Act (ACA) subsidies are expiring, not to mention the debt limit will need to be addressed again.
2024, election, tax, cuts, aca, deficit, congress
424
2023-12-26
Monday, 26 June 2023 10:12 AM
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