The alleged Senate fiscal hawks threw up the white flag of surrender. 
OBBA Advances 51-49
As expected, the Senate fiscal hawks did what they always do, and that’s surrender without a fight.
The initial vote on the One Big Beautiful Bill Act was 51-49, with most Republicans in favor and all Democrats opposed, putting the Senate potentially on track to pass the bill by Monday after a day of debate and amendments. GOP Sens. Rand Paul (R., Ky.) and Thom Tillis (R., N.C.) broke with their party to vote against advancing the bill. The revised text of the 940-page Senate bill was released late Friday night and is likely to keep changing.
Sen. Lisa Murkowski (R., Alaska), who has called for protecting clean-energy tax credits, negotiated on the Senate floor with Finance Committee Chairman Mike Crapo (R., Idaho) before voting yes. The final holdouts were Sens. Rick Scott of Florida, Mike Lee of Utah, Ron Johnson of Wisconsin and Cynthia Lummis of Wyoming, who want deeper spending cuts.
Johnson, who had earlier voted against advancing the bill, switched his vote and joined the others in voting “yes” at about 11 p.m. ET.
He said afterward that GOP leaders and Trump will back Scott’s proposal to cut off new enrollment for the Medicaid expansion that was part of Obamacare, where the federal government pays 90% of the cost of health insurance for some adults. The idea has drawn opposition from GOP moderates, however, and may not pass.
The latest version of the Senate bill offers a more generous deduction for state and local taxes—known as SALT—through 2029 than the previous Senate iteration. It gives states more time before lowering the ceiling on the so-called provider taxes used to enhance state Medicaid budgets and in turn attract federal matching funds.
The revised bill would also cut off tax credits for electric vehicles, solar and wind projects more quickly than the initial Senate version, in a blow to companies hoping their Republican senators could do more to shield them from an effort to roll back spending on EVs and renewable energy. It would impose a new excise tax related to the use of certain foreign components in renewable projects.
Sen. Josh Hawley (R., Mo.) said he backed the bill despite opposing a Medicaid-funding formula change in it. He said his state would get increased Medicaid funding for the next few years due to a $25 billion special rural hospital fund designed to mitigate harmful effects from the bill and said he would fight in subsequent legislation to make sure that the postponed cuts don’t actually take effect.
Sen. Susan Collins (R., Maine) voted to move ahead with the measure, though she said she hasn’t decided on whether to support the final bill. Collins, who has expressed concerns about the Medicaid cuts, also floated letting the top income-tax rate revert to its pre-2017 level of 39.6% at some high income level.
All of these clowns are pretending they may not vote for the final bill. Johnson said afterward that GOP leaders and Trump will back Scott’s proposal to cut off new enrollment for the Medicaid expansion that was part of Obamacare.
Yeah right. Scott and Johnson will try to get what they waved a white flag over.
Seriously, what the hell?
Medicaid is more likely to get expanded than cut when Collins and Hawley demand more.
And on top of it, we have a brand new rural hospital fund that will probably scale up to $250 billion from $25 billion within a few years.
Yes, I am disgusted, as predicted.
The Senate Bill Is Now Fiscally Worse than the House, Deficits Increase
For analysis of OBBA please see The Senate Bill Is Now Fiscally Worse than the House, Deficits Increase
Compromise increased the deficit. And Republicans back a new hospital fund. Look out!
Republicans are team players without a moral core. Similar to the Nazis who were also team players with no moral core. Team players commit atrocity, and this bill is an atrocity.
Physical reality trumps the monetary. See: https://surplusenergyeconomics.wordpress.com/2025/06/30/305-the-inconvenience-of-imminence/
It seems that there is at least a chance this bloated boondoggle dies today. That’s because, according to my math, we have 4 potential NO votes on the GOP:
AND … the biggest wild-card, 4. Susan Collins. She’s not happy either, but I worry about her selling out for some promise, probably a couple of billion in “walking around” money for Maine.
I was going to write a comment but Phil Labonte said it for me in his Tweet quoted above.
I still haven’t heard of the Democratic alternative. Has anyone else heard a counter-proposal?
That’s not how this works
Yes of course. Cancel the tax cut?
The Clinton way was also about refusing to cut taxes.
Can you say “Highly Inflationary”
Or, “Highly Irresponsable”
?
OBBA
One Bloated Budget Act
Thanks for another massive lie Dictator Trump!
Elections have CONSEQUENCES!
If enough people want something, they get it, whatever the various labels, arguments or legalities say. Enough people want MAGA that Congress members are now left the choice of losing their jobs or voting their consciences. Enough people meanwhile want more free stuff, so the masses are getting what they are demanding on all fronts.
If u got $10,000 u will cut c/c debt, put some money in the bank and spend little.
Trump is not Biden, who used CA tax payers money to win swing states. CA working people are very angry with the dems and Gavin. Trump brings them to his side, to the reps camp. Trump will use this money to cut debt. The private sector along with trillions from foreign investors will finance our industrial expansion. Without tariffs they will not come.
democracy has always worked. since republic of plato was penned. and before.
I guess rural MAGA voters did not consider that they are payees of this stuff. But once the desired results are in sight, things get fixed up. Anyone could have seen that, but this dance must go on, with the blindfolds selectively in place. Convenient forgetfulness saves the day. It’s not a uni-party, if the right flag is flying over the castle.
And when those rural farmers and the families (whose local economies they support) can not sell their grains for more than the cost of production realize they have been HAD AGAIN? There will be hell to pay!
Although MAGA’s do like to stay in their silos and never change their TV’s from Fox.
Where’s that Humpty Dumpty cartoon?
I wonder what the bond vigilantes will have to say about this. Who thinks this debt will ever be paid off?
JP will cut rates. The federal gov interest payments: $1.1T. The pair higher debt/ lower interest rates along with: slightly elevated inflation, tariffs, higher payroll and realized gains taxes and a smaller gov will fill gov coffer….I repeat it for years.
In 2025 our most modern weapons are depleted. Without them we are a deflated superstate. So are: England, Germany and France. It will take yeas to replenish them. Without them we are under the evil axis threat.
Why would he do that in an inflationary environment?
Especially with the bond market moving in the other direction as our credit rating falls as a result of having a bloated narcissist as potus!
Goodness, you do live in a tinfoil hat world…
I propose the republican party disband. They are merely democrats who recognize women’s sports should have fewer penises. Such trivial differences are not enough to justify an entire political party.
OMG! Good One!
😉
The Senate hawks are simply following in TACO’s footsteps by capitulating.
senate hawks? bwwaaaahhhhhhhh. easter bunny ain’t real kid.
If a NYS republican gov elected she will dump Fatma on day one. If Mamdani elected, he will be on a leash, treat all with respect regardless of their religion or wealth.
As if we need additional evidence, this bill demonstrates how both parties, particularly Republicans hold middle and working class voters in contempt. The explosion of corporate and other special interest money flooding into our politics has completely corrupted the system. Its all about the Benjamins. Voters are barely an afterthought.
Who’s been reading Marx?
That’s funny. I haven’t read Marx since Poly Sci 201 over 40 years ago. As I remember, Marx’s 19th century theory of a totally corrupt and disengaged elite making conditions ripe for revolution is an interesting framework for understanding our post Citizens United politics, with Trump being the first eruption of a frustrated body politic.
voters get exactly who they vote for. their representatives are perfect reflections of the voters. always.
The only surprise to me is that people here think that voting for either party will make a positive difference to their lives.
If you want to improve your life, that’s on you. Though it take hard work and perseverance. Only the lazy expect politicians to make their lives better.
I don’t expect it, however so long as they receive my tax dollars and a salary i think it’s appropriate for me to want them to not make it worse….I have my own poor decisions or enemies to do that
U can’t turn around an aircraft carrier on a dime. The US is the largest economy in the world. U can’t reduce its $36T debt on a dime. It’s not a jump over the cliff. It
will decay and rollover in real and nominal terms.
The debt is “optimistically” projected to “only” grow from the current $36T to $54T by 2034. There will be no “reduction” in debt.
wrong !
Care for a friendly wager?
What year will this “debt reduction” begin? For 2025 the deficit is projected at $1.9T, which is 6.2% of GDP.
There is no hope to people on this blog. Most of the money will not be spent. It will park in the Fed saving account and pay debt and interest. That’s what UUU will do if UUU got a $100,000.
What’s wrong? Can’t answer a simple question? What year will the US begin running a surplus and begin paying down debt?
It won’t be this year.
Pick a year. How hard can it be?
Nope. I don’t use savings accounts. They don’t keep pace with inflation. I put my money in far more productive and lucrative investments.
If u looked at my TA comment from the previous blog u might get a clue. Timing is crucial. If u put your money on Mon u might lose it in the next few months. Trump will cut debt and spend little on pet projects. Foreign investors, US investor and the banks will finance the econ expansion. Not the US gov. Without tariffs they will not come. Interest rates below inflation are negative div.
$45T debt x (-)2% x 10Y = (-)$9T. Let me repeat it again: I am not in your courtroom !
Hahahaha! Funny!
Thanks for that. I needed a good laugh.
that guy engel is a troll. i would suggest blocking him.
To reduce debt you must run a surplus. The US has run a surplus in like 1 or 2 years since 1970.
Also to run a long term surplus (more than a year or two) the US dollar would no longer be able to be the reserve currency. That’s also very unlikely to happen anytime soon.
The gov collect more money than ever before. It fills the gov coffer.
With that money the Gov can cut debt in stepping stone, even without a surplus. Foreign investors trust a country that cut its debt. The dollar will not deflate.
What a load of shit. What does it matter if the government collects more money then ever before If they keep spending $2T more than they collect?
The debt will keep growing.
Idiot.
Cutting debt is #1 priority. Cutting the budget deficit to zero is
NOT a priority. Capex started already: foreign and private US investors, financed by the banks poured in. It’s just starting. A gov with a budget deficit can say not now, no, no money for pet projects. U don’t understand business.
“Cutting debt is #1 priority. Cutting the budget deficit to zero is NOT a priority.”
Lol! You’re an idiot.
You cannot cut the debt unless you run a budget surplus.
If you owe $1000 on a credit card, and make a $100 payment, while spending another $300, your total debt level does not go down, it keeps going up by $200 each month. The only way to reduce your debt is to pay off more than you spend each month: you must run a surplus.
How can you be so f*cking stupid?
I assume troll at this point. Nobody can be that dumb.
In 2020 the Fed raided other people’s bank accounts and distributed it to the poor
and the middleclass, including to those in CA, NY and TX, three states infested with Shingle
mums and people on state’s support, which got the most from the socialist gov.
Cutting interest rates to zero wasn’t good enough. The econ needed a larger booster to avoid a 2008/2009 type collapse. The Fed saved another CA RE collapse. That’s why CA and NYC RE is out of reach.
NY and CA governors are spoiled brats. That’s why the reps will replace them in Nov 3 2026.
They’re going to ram this through with lies and promises that will never be kept. As Mish says, look for the fiscal “conservatives” like Johnson to get rolled. The Medicaid cuts will never happen.
Still waiting Mish
waiting for Godot? or what?
Because of the insane way US fiscal bills are presently discussed (the only question asked is: how much debt does the 10-year bill add to debt relative to current policies/laws?), most people don’t realize that this monster bill will likely add about 40 percent of GDP ($27 trillion) of new debt over the next 10 years. This would be the largest debt-GDP ratio increase in US fiscal history, even exceeding the 1941-51 debt-GDP increase when we fought WW2 and had to face Stalin‘s evil empire. Obviously, the calculation of the politicians must be that the Fed will buy any new debt that the market doesn’t want or can’t absorb given the flood of debt going to be unleashed by Trump & Company.
Kabuki theatre on the road to ruin.
At 68 years old I’ve watched 40 years of tax cuts for corporate and wealthy citizens allegedly going to pay for themselves. Not once does history show that happening. We need nothing sides to cancel the Trump and Bush tax cuts and implement a maximum 1% increase in government spending budgets. Then let’s see where national debt is 10 years from now.
why would anyone confuse RED team with fiscal conservativism or social conservatism. radicals on spending and radicals to control everyones lives from bathrooms to doctors offices. laughable to use the term conservative. this empire is busted. and we fund majority of Israel department of war. talk about stooooopid.
Let’s get real if ya ain’t already! The only way this corruption ends is when the treasury market collapses, they’ll keep driving until they are off the cliff. That could be sooner than most sheeple wanna believe. Even the worse borrower on the planet would have been stopped long ago from borrowing a cent. It’s better this way anyway, the lessons of the past have all been forgotten, they will be re-learned in due course.
My text to the Senator…yes I write to them. As futile as pissing into the wind or screaming during a hurricane. It’s a disgusting, vile lot whose sole purpose is to enrich the current generation on the backs of future generation where massive amounts of money are now needed to have GDP growth rates move north and ever decreasing rates relative to money spent. The House will quickly vote for this after it has filled it up with more compromises and, as Mish predicted, it will be much, much worse.
I want to vomit. How difficult is it to just hold the line and stick to your principles. Hell the Demonrats will pretend this bill bothers them but deep down they love it–they lose nothing, we get massive deficit spending, their consitutents are happy and all the fiscal fallout falls on the Republicons.
“Honorable (?, though not in my contact) Senator Johnson,
I awoke Sunday June 29th seeing the Senate passed the abomination of a deficit-spending bill which you had correctly opposed and about which you posted in-depth videos with charts and graphs explaining what we needed to do instead. Thus I wanted to see how each Senator voted and was SHOCKED to see you as having flipped your vote. Sadly Senator your job, based upon not only American citizens’ interests but also on the integrity of all that you said and did prior to this vote, was to vote against this bill and yet there your name was in support. Any reservations against it are meaningless when there is a Yea next to your name, akin to spending 2 weeks rallying for it with pom-pons. To say I feel betrayed is an understatement. Wisconsinites will now, once again, be supporting California, New York, Illinois, DC, and Seattle’s flawed fiscal policies by allowing them SALT tax exemptions of up to $40,000 in free income that we do not enjoy. This horse-trading was of the worst kind. And to INCREASE the already-mind-numbing House debt ceiling lift of $4 Trillion to $5 Trillion? Oh my!! I concluded now that there is no difference between you and Senator Baldwin other than she is 100% determined to destroy America whereas you enjoy SAYING you want to save us while VOTING for the debt anchor. Your vote was clear–vote No. Should it have been then 50-50 then VP Vance could cast the tie while preserving your logical consistency and integrity. I’m extremely disappointed.”
Of course the irony is Senator Baldwin voted against it but we all know it was because Trump supported it. The bill, as written, would have been supported by Baldwin if Biden/Harris/Walz were President OR the bill spent MORE.
It won’t matter to me much because I wont be around but it has occurred to me that the best way to kill the out of control federal beast is for a few big states: California, New York, and Texas, to stop remitting money into the central government. I’m not sure how the federal government would force states to “pay” money into the fed system but that’s the most viable thing at this point.
I know California has already threatened that if Trump keeps cutting California funds. New York is on the verge of going socialist so add that to the list. And Texas isn’t thrilled with the current situation despite being a “red” state.
The alternative is the bond market going haywire that forces change but either event will get real ugly real fast for all the government dependent leeches.
Got exit strategy?
If only that could be done. What is the exit strategy? Monetarily we hear gold, Bitcoin,etc but we have to live somewhere and the developed world, thanks to the greediest (due to being the largest) generation all used the fiat-currency deficit-spending model.
I don’t have much in the markets but thankfully own a home (though property taxes prove I don’t actually “own” it).
Imagine the debt doubling in the last 10 years, a 7.2% annualized rate. OMFG! And that’s just federal.
Markets will love this again though–all of that deficit funnels to them. Beautifully crafted by IRA and 401k legislation designed to make the average Joe complicit in the scam.
You think social security is a scam….oh boy, look at those grifting financial markets!
The exit strategy is to move overseas and minimize paying taxes to the U.S. Since I will be quitting work, it will start with no more FICA paid into the system. I will live off dividends, interest, rental income and capital gains all optimize to pay as little tax as possible.
You may think I’m being selfish but I’ve paid over $100k in taxes each year for the last 15+ years. That is going to change in 2026.
Best of luck to the sheeple left behind to deal with the wolves.
Good luck to you, I hope you find peace and contentment in your new country.
Are you also renouncing US citizenship?
I’m sure you know citizens abroad still pay US taxes (unlike most other countries – for example I pay no Canadian taxes).
Hopefully it all works out for you. As someone in their mid 40s you have a LONG time to live and that means there is a LONG time for the Federal government to shaft people like you (extra taxes for overseas people especially on property since you would be around to vote against it).
Don’t plan on renouncing but if things go full nazi crazy in the U.S. you never know. Never say never as they say. I am well aware of the tax situation, far more than most people on the planet. It’s part of the reason I can’t stay longer than 183 days in many countries because it triggers tax residency.
There are a few places that have tax incentives to attract people and if I decide I like living in that country full time I will consider it but the world is a big place, lots to see, lots to do.
One obvious option is Puerto Rico.
As a territory it sets its own tax rates. On business income it’s incredibly low, better than Ireland. Only need to invest a million in buying a local business (or starting one) to get the status you need to reside there for tax reasons.
John Maudlin moved to PR because Texas taxes were too high.
I wonder if MPO45v2 is renouncing his citizenship as well. There is no way I would renounce my citizenship! Regardless of the tax implications. I pay huge taxes six and sometimes seven figures!
It is a small price to pay for living in the greatest nation on earth! And yes I have travelled extensively!
OK, I have not been to China, Russia, Brazil, Iran, the Koreas and all of Africa plus none in the Middle East. But I have covered most of the English speaking and European nations.
NO WAY would I leave the U.S. permanently!
Red states would crash immediately without all that sweet federal cash from California.
true. don’t forget CA issued, payment in kind during the real estate bust almost 20 years ago. that’s currency. it worked, too. issuing CA or TX……legal tender is simple and easy and very old fashioned. for sure gonna happen. not if. just when.
What do you mean? The Federal government would just borrow whatever they needed in California’s name (well technically all 50 states names but you get the point that California is on the hook for Federal debt same as everyone else).
if you exit USD for most of your net worth and life, moving out of this dying empire sounds like a good move. i was doing business with an oligarch and his banker in post USSR implosion in the 90s. world wide war mongering empires always collapse. some do it fast, like the soviets, some drag it out like the split in the Roman Empire………..i’d imagine the states here will be the most important law and monetary thing in all our lives, who stay put. i bet this with a few pals back in 2018, that we’d be done by Jan 20th, 2028. it’s really not a big deal. pre 1860 set up. probably be a yawn for most of us. just don’t really on the feds to fullfill anything worth a dime in coming decade.
meant to type, don’t rely on FEDS. the trump crime family will for sure speed this along by stealing everything not nailed down. the Ds will of course have their snouts in the trough, also. been there, done this.
I plan on being well diversified in currency and investments across the globe. Never put all your eggs in one basket as they say.
if you set yourself up correctly in the usa, the tax code can be your friend. alas there are great places in this nation and the globe to live. good luck.
No one can stop remitting money to the Feds. States can threaten it but if any were crazy enough to do it they’d be slapped down so hard so fast (cut off from banking, cut off from electricity, all air/sea transport cut off, highways in/out of state cut off, internet shut down etc) all without needing to send in any troops.
states are slowly but steadily nullifying many fed mandates and laws…….from CA and weed 30 plus years ago……….nothing stays the same, kid. look at our short 250 year history. we went from articles of confederation, to coup of 1787, to secession and war in 1860……..to troops around the globe with our pawns from saudi to zion to japan and korea…………all empires bust up. without exception.
Don’t look now, but nobody is talking about repealing the “Patriot Act”.
There are no fiscal hawks (maybe Paul). Everyone else is a poser. Dems spend and tax. Reps spend less and cut taxes. Neither cares about the financial viability of their country past their personal reelection dates. It’s long past time we face that. We’re in for a disaster. We just don’t know when its coming.
didn’t we all figure this out with nixon and raygun? yawn.
I’m not as sharp as you. I took longer…
at least you are honest. i was a teen when nixon 2nd term. seemed obvious. and raygun, was an obvious spendthrift. debt maniac. even a college kid like me could see that between keg parties……..