President Donald Trump’s much-hyped “Big Beautiful Bill,” a sweeping package of tax cuts and entitlement reforms, has passed the House and is now facing rigorous debate in the Senate. While supporters hail it as a bold economic reboot, leading economists are raising red flags—none louder than Nobel Prize-winning economist Joseph Stiglitz, who warned that the bill could “wreck the economy” and deepen inequality in America.
“It’s hard to exaggerate how bad this would be for the economy,” Stiglitz told CBS News.
“This would exacerbate inequality, it would undermine our ability to compete in the 21st century, it would leave millions of Americans worse off.”
Key Provisions of the Bill
Tax Cuts for Working Americans: The bill would make tips and overtime pay tax-free and raise the SALT deduction cap from $10,000 to $40,000 for those earning under $500,000—a move popular in blue states but controversial among fiscal conservatives.
Entitlement Reform: It imposes stricter eligibility for Medicaid and food stamps, introduces work requirements, and eliminates some federal student loan programs, igniting fears that vulnerable Americans may lose vital safety nets.
Spending Shifts: While slashing funding for environmental and education programs, the bill allocates over $150 billion in new defense spending, emphasizing autonomous weapons and increased border infrastructure.
Economic Concerns Mount
Stiglitz isn’t alone. Multiple Nobel-winning economists have echoed concerns that the bill could increase the federal deficit by over $2 trillion in a decade, while disproportionately benefiting wealthy Americans. Critics argue that this approach echoes the 2017 Tax Cuts and Jobs Act, which, despite initial promises, failed to generate long-term growth or widespread wage increases.
“The bill delivers short-term sugar highs for the economy while injecting long-term fiscal poison,” said one fiscal policy analyst. “It’s Reaganomics with a darker twist.”
Political Landscape
Despite passing the House narrowly, the bill faces turbulence in the Senate. Key Republican senators like Rand Paul and Mitt Romney have criticized the plan’s ballooning cost and potential to gut critical services. Meanwhile, Trump allies defend it as a “historic realignment of government priorities,” framing opposition as “economic sabotage.”
Senate Democrats have vowed to resist the bill, calling it “a betrayal of working-class Americans,” while progressive activists are launching nationwide protests.
What’s Next?
The Senate is expected to begin formal markup sessions next week, with the Trump administration hoping for a July 4 vote to align with Independence Day celebrations. Yet with economic experts warning of serious long-term harm and public opinion deeply divided, the road to passage looks uncertain.
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