
The One Big Beautiful Bill to advance President Donald Trump’s agenda may not have the devastating impact on the national deficit that some critics claim.
The Congressional Budget Office (CBO), tasked with providing “objective, nonpartisan information to support the Congressional budget process,” estimated that the Senate version of the GOP’s reconciliation bill would add $3.3 trillion to the deficit over 10 years. The president’s Council of Economic Advisors (CEA), on the other hand, estimated that the bill could reduce the deficit by $4.5 trillion.
The dramatic discrepancy between the estimates from CBO and the CEA stems largely from differing assumptions about what counts as expected future policy, known as the baseline.
CBO relies on a “current law” baseline, which assumes that key provisions of the 2017 Tax Cuts and Jobs Act (TCJA) will expire. In contrast, the Trump administration and some fiscal watchdogs favor a “current policy” baseline, which assumes those tax cuts will be extended, as they often are, and therefore does not treat the extension of the 2017 Trump tax cuts as a new cost.
Meanwhile, Democrats and fiscal conservatives in Congress have expressed outrage over the deficit impact projected by CBO, with Sen. Ron Wyden — the top Democrat on the Finance Committee — warning that the reconciliation bill would leave the U.S. “a weaker, sicker and poorer country.”
The fight over the budget baseline came to a head in the Senate, where Democrats tried — and failed — to force the reconciliation bill to be scored under the current law baseline, accusing Republicans of “faking” the math to support their positions. Had the Democrats succeeded, GOP lawmakers would have had to rewrite the tax portion of the bill.
While CBO is statutorily required to use the current law baseline, supporters of the current policy baseline argue that this approach is fundamentally flawed.
“The current policy baseline is a more realistic measure of actual outlays and revenues in the long term because tax cuts typically get extended,” Hayden Dublois, data and analytics director at the Foundation for Government Accountability, told the Daily Caller News Foundation. “[The current law baseline] assumes that discretionary spending on certain programs will grow even without statutory authority. For instance, they assume Medicare and Social Security will continue at their scheduled levels even when the trust fund balances out and trigger automatic cuts.”
Dublois added that CBO projections should be “taken with a grain of salt” due to its track record of “underestimating the savings from the reforms that reduce the cost of government and underestimating the costs of growing the government.”
Office of Management and Budget Director Russ Vought made a similar argument in a post on X ahead of the bill’s passage in the Senate.
“Remember, those saying that the Senate bill increases deficits are comparing it to a projection where spending is eternal, and tax relief sunsets. That is a Leftist presupposition,” Vought wrote. “This bill reduces deficits over the next ten years, even if you ignore increased revenues from dynamic growth. And importantly, the $1.6 trillion in spending reductions exceeds the bicameral framework agreed to prior to final passage of the budget resolution with Speaker Johnson and Leader Thune.”
Some perspective as we complete Senate passage of the One Big Beautiful Bill. The same game is being played by the so-called fiscal watchdogs to mislead the public by not assuming the continuance of current tax law. Remember, those saying that the Senate bill increases deficits…
— Russ Vought (@russvought) July 1, 2025
A spokesperson for CBO declined to comment.
Still, the CEA’s estimates assume that some tax breaks in the bill — such as exemptions for tips and overtime pay — will expire in 2028. Making those breaks permanent would reduce revenues and increase deficits by an additional $1.5 trillion, according to projections from the Bipartisan Policy Center.
Beyond baseline disagreements, the White House argues that the CBO is missing the broader impacts of the economic growth that Trump’s policies will create. The CEA estimates that the Big Beautiful Bill will increase the level of Gross Domestic Product by 2.5 % to 2.8%, while CBO projects a much more modest increase of 0.4%.
“Many of the other models focus in on the One Big Beautiful Bill very narrowly and miss that it’s a big part, but only one part, of the overall agenda that obviously worked in the first Trump term and we think will work on an even bigger scale the second term,” a White House official told the DCNF.
The official cited the “cascading effects” from Trump’s energy and trade policies, as well as the administration’s deregulatory efforts, as likely to drive strong growth. The CEA estimates that the reconciliation bill, scored with the current policy baseline and along with the full suite of Trump policies, will ultimately reduce deficits by $8.87 trillion.
CBO has made notable errors in its past assessments of major legislation.
The office initially estimated that former President Joe Biden’s signature Inflation Reduction Act would reduce the deficit by approximately $58.1 billion between 2022 and 2031. However, in its 2024 outlook, the estimate was revised to a $428 billion increase in the cumulative deficit, $224 billion of which they attributed to adjusted projections of the IRA’s electric vehicle tax credits and revenues from gas taxes.
In addition to concerns about its methodology, CBO has faced questions about potential political bias. A recent FGA report found that, of the CBO employees whose voter registration could be identified, 78.9% were Democrats, while only 12.5% were Republicans and 8.6% were independent or unaffiliated.
“I have no confidence that the CBO is going to get it right this time when they’ve gotten it wrong so many times in the past,” Dublois said. “I would trust the Office of Management and Budget, Russ Vought, and CEA over CBO because of its poor track record, not only in estimating static savings of things like Medicaid and food stamps reforms, but also in being perpetually wrong on economic growth assumptions.”
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Author: Melissa ORourke
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