Romina Boccia and Ivane Nachkebia
With the Senate’s vote-a-rama now underway, here’s what you need to know about the reconciliation bill.
Romina Boccia speaks to BBC News about the Senate reconciliation bill. Last night, Boccia joined BBC News’ Sally Bundock to discuss the Senate’s reconciliation bill, which she called “one big bloated blunder.” She pointed to two potential amendments in today’s vote-a-rama session (a process allowing unlimited amendments) that could improve the bill: reducing the federal match rate for Obamacare expansion beneficiaries and cutting farm subsidies for wealthy farmers. If adopted, these changes could help the Senate meet the House’s $2 trillion deficit reduction target. Boccia warned that the bill’s current version “doesn’t provide any reassurance to US bondholders that Congress is in any way serious about addressing the unsustainable entitlement programs driving the growth in US spending that will eventually lead to a debt crisis.” She added that the bill’s modest cuts to social programs are “far outweighed by the additional pork, both on the spending side and on the tax side.” Watch the full interview below.
The Senate’s reconciliation bill would deliver more economic growth than the House’s version—but still blow up the deficit. Adam Michel, director of tax policy studies at the Cato Institute, had this to say about the Senate’s reconciliation bill: “The Senate version of the Big Beautiful Bill will deliver significantly more economic growth than the House-passed version, thanks to permanent investment expensing. But it also includes more than half a trillion dollars in new and expanded tax subsidies and other pork. The result? More debt. The bill will add trillions to the national debt and violate the House’s agreed-upon fiscal guardrails unless lawmakers scale back the pork or deliver more spending cuts.” For more on the differences between the tax proposals of the House and Senate versions of the reconciliation bill, see Michel’s analysis here and here.
Medicaid’s unfair Obamacare expansion may be curtailed. Sen. Rick Scott (FL) is advancing an amendment to the Senate reconciliation bill that would end the enhanced federal Medicaid match for ACA expansion enrollees after 2030. States would receive the standard federal match for new enrollees after that date, reducing a funding distortion that privileges able-bodied adults over the truly vulnerable and misallocates taxpayer resources. This reform is long overdue. Originally, Medicaid served low-income children, pregnant women, the elderly, and people with disabilities. Obamacare expanded it to able-bodied, childless adults, offering states a much higher federal match—$9 for every $1 spent—compared to just $1.33 for the neediest. As covered in a Paragon Health Institute two-pager on the “Consequences of Medicaid’s Discrimination Against the Most Vulnerable,” the CBO projects that lowering the 90 percent federal reimbursement to the normal state reimbursement would save $710 billion over nine years (2026–2034). Congress shouldn’t delay this provision nor grandfather in current beneficiaries.
Sen. Chuck Grassley’s (IA) amendment to cap who can receive farm subsidies is a welcome measure in a bill otherwise packed with giveaways. It targets a fundamental problem: federal farm programs routinely line the pockets of relatively wealthy farmers under the guise of helping struggling farmers. Caroline Milear, a fellow at R Street, writes on X that “Sen. Grassley’s reconciliation amendment is a positive step towards stopping the corporate farm handouts and helping smaller producers compete in agriculture. Republicans who call themselves advocates of small government should all be in support!” Cato’s Chris Edwards previously covered the “brazen” farm subsidy increases in the reconciliation bill, stating that “Liberal critics are right that Republican efforts to cut low-income welfare in the reconciliation bill are hypocritical since the bill boosts high-income welfare for farmers.”
Budget gimmicks mask the Senate bill’s real price tag. In a post on X, George Callas, executive vice president of public finance at Arnold Ventures, highlights how the Senate uses budget gimmicks to hide the true deficit impact of the OBBBA: “A reminder that the Senate is NOT using a current policy baseline. If they were, then the new temporary tax cuts (tips, OT, etc.) would be scored as permanent. The Senate is using a different baseline for each tax cut, based on whatever does a better job of hiding the cost.” As Boccia has written before, “Americans deserve an honest conversation about fiscal policy and the tradeoffs involved—not creative accounting and budget gimmicks that allow politicians to keep spending like there’s no tomorrow. Because if we continue down this road, there won’t be a tomorrow where America’s finances—a key foundation of the nation’s economy—are still intact.”
The OBBBA’s senior tax giveaway would accelerate Social Security insolvency. The Committee for a Responsible Federal Budget (CRFB) reports that the temporary additional senior deduction in the Senate version of the OBBBA would accelerate the Social Security trust fund’s insolvency. The CRFB explains, “Of particular relevance for Social Security beneficiaries, the Senate version of OBBBA would increase the total standard deduction for many senior couples by over $13,000 (including a temporary $12,000 increase in the additional senior deduction) in 2026, to over $47,000. This would reduce the number of seniors paying taxes on their benefits and reduce the marginal rate at which some of their benefits were taxed.” Boccia calls this temporary provision “a blatant vote-buying effort to benefit an electorally powerful group, who already receive 40 cents of every federal dollar on top of holding most of the nation’s wealth.”
This post originally appeared on The Debt Dispatch Substack. To get the latest fiscal updates—including the weekly Debt Digest newsletter—delivered straight to your inbox, make sure to subscribe.