Sen. Ron Johnson’s Analysis of Deficit Impact from GOP Bill
Former accountant and current Senator Ron Johnson (R-Wis.) recently shared an in-depth analysis of a Republican-backed legislation, emphasizing that it could significantly increase the deficit. This contradicts claims made by the White House regarding the bill’s budgetary implications.
Johnson pointed out that prior to the White House’s portrayal of the budgeting methods, multiple assessments had been done about the extensive financial consequences of the proposed bill. According to data referenced from the Congressional Budget Office, the deficit could rise by a staggering $24.1 trillion—or at least $3 trillion over the next decade—due to this legislation.
Additionally, he noted that the recent White House memo suggests plans to decrease the deficit from approximately $6.7 trillion to $6.9 trillion through revenue from tariffs and discretionary spending cuts. He argues that by implementing these strategies, there would be a potential reduction of $2.5 trillion in baseline estimates identified as “current laws.”
However, Johnson cautioned that Democrats are likely to resist the suggested discretionary cuts, and that the best-case scenario might be unrealistic, as potential legal challenges could jeopardize Trump’s tariff policies.
“I’m just trying to lay out what should be examined as we consider passing such an important law,” Johnson stated during a press briefing. He recently collaborated with Trump’s economic advisor, Kevin Hassett, to further validate his findings.
“I hope this analysis ignites debate,” he added, expressing his desire for other economists to engage with the information he provided, especially given reliance on sometimes questionable CBO estimates.
Despite his concerns about the current form of the legislation, he argued that the bill is flexible in several details and emphasizes the necessity of containing overall spending. His report critiqued the CBO’s deficit score, claiming it erroneously assumes a domestic production growth rate of 1.8%, based on historical averages.
Additionally, some Republicans have argued that the tax benefits from the 2017 Tax Cuts and Jobs Act were overstated following adjustments for pandemic-related inflation. Johnson noted that the claim regarding the TCJA’s financial benefits over seven years is difficult to substantiate.
Central to the one big beautiful bill is the aim to modernize key features of the Tax Cuts and Jobs Act. Johnson insisted that he does not wish to see tax increases, which could occur if the key provisions from 2017 lapse at year’s end. Yet, he reiterated the need for Republicans to focus on reducing spending.
One potential approach he suggested is a forensic audit of government expenditures, questioning the current efficiency of the government’s financial operations.
Johnson expressed skepticism regarding the feasibility of passing this legislation by the July 4 deadline and suggested that Republicans should tighten their fiscal strategies on other pending bills. He foresees that there will be discussions in the Senate next week, joined by other fiscally conservative members who share concerns about the efficacy of the bill in controlling spending.
On Tuesday, the CBO released an updated estimate indicating that this legislation could potentially add $3.4 trillion to the deficit over the upcoming decade, factoring in its prospective effects on economic growth. This estimate surpasses earlier predictions and indicates a trend where dynamic scoring typically results in lower deficit growth than static analyses.
Johnson’s earlier findings were based on static CBO projections before this dynamic score came into play.
