Andrew Egger (4:37)

Yeah, I really wanna dwell on just like how unusual this whole thing was because Politico was reporting just this morning that there were problems with the bill, but you know, with that people on the Budget Committee weren't on board, but that they were just gonna table it and then maybe come back to it next week, hopefully smooth those things over. And I think that you're right that basically what this signifies is there was going to be no smoothing over possible with this current thing. And so they just kind of bit the bullet and voted it down in its current state. But not only a kind of an embarrassment for Republican leadership in the House in this way, but I mean, the White House has been pushing very hard for everybody to get on board with this thing. I mean, it has really been sort of a unstoppable force versus immovable object sort of thing. Because usually when Donald Trump tells Republicans to do a thing, they, they can't do it fast enough. Right. But, but in this case, there are so many different kind of cross currents of infighting about what different groups want to see in this bill. You know, moderates in blue states who want different tax carve outs for high, for high, high tax state residents or, you know, budget hawks who are, like you said, are mad about the, the Medicaid phase ins not happening. The Medicaid reform phase ins not happening quickly enough. There are social conservatives who are trying to defund Planned Parenthood with this thing. And all of these people are kind of at loggerheads. And what Donald Trump is trying to do to everybody is just say, hey guys, just chill out, it's gonna be cool. Just get with it. Trust your committee chairs, trust the process, trust the bill and vote yes. And as we're seeing, that's really running aground here.

Unnamed Congressional Reporter (6:13)

Yeah, I think that the problem here is that everybody, through a massive budget reconciliation, through a justification of tax cuts, everybody kind of wants a different thing. So you have the moderates who want an increase in the state and local tax deductions so that they can, you know, go back to their constituents in these high tax blue states and say, we got it done for you guys. We reversed the previous low cap that was there from the first Trump tax cuts in his first term. You have these far right guys like Chip Roy saying, we want to do something about the deficit. We finally want to rein it spending. We want to kick people off Medicaid, particularly like the poorest people. And then you have Trump who just says, I want this big ceremony where I can sign this bill and hold it up and all my buddies get a kickback. And like, everyone is sort of angling and wants a different thing. And the goal to doing this is cutting taxes, eliminating certain areas of safety net programs and how they all get there. If they all have different goals, it's going to be very difficult. And we're already seeing it cracking in a way that I didn't think it would because usually it's very easy to find common ground. For Republicans when their goal is cutting taxes, it's a lot harder for them to do things like repeal Obamacare or, you know, being very specific on entitlements. But when their goal is cutting taxes, they can usually get the job done. And the fact that they've hit this, like, snag so early on, I think we're going to be in for a rough summer. Very rough summer.

Andrew Egger (7:55)

Yeah. Yeah. I mean, it really is kind of astonishing. I wanted to talk a little bit more about the bill that failed because it's just, I mean, it's one thing to just say like, these Republicans want more cuts or want more tax cuts or want more spending cuts or whatever, but this was already, I mean, like you say, like a pretty top loaded Republican bill. Lots of tax cuts for high earners, lots of benefit cuts for poor people and low earners. Just to grab a few graphs out of some New York Times reporting today about the latest assessment of the bill that just went down from the Penn Wharton business model. Economists found, quote, that many Americans who make less than 51,000 dol thousand dollars a year would see their after tax income fall as a result of the Republican proposal beginning in 2026. The Penn Wharton estimate sought to analyze the full scope of the Republican tax passage. People making between about $51,017,000 could lose about $700 on average in after tax income beginning in 2026, according to that analysis, when factoring in both wages and federal aid. And that reduction would worsen over the next eight years. By contrast, the top 0.1%, including those with incomes over $4.3 million, would gain on average more than $389,000 in after tax income in 2026, the data show. So this is, this is the bill that Republican budget hawks just voted down as, you know, insufficiently cutting the benefits of low earning people and poor people. So this is, I mean, who knows what is going to come out of this? Who knows whether it's going to be anything the moderates can swallow because the more you pull it in one direction, the more you risk losing people on the OPP end. I mean, where, where do you see any of this going? I mean, like what's, what are, what are we going to see out of House Republicans next week when they come back on this thing?

Unnamed Congressional Reporter (9:42)

So it's important to understand, like, the history and the behavior of the different factions in the House. So the moderates, these blue state Republicans from California, New York, who are absolutely critical to them maintaining any kind of majority, they're the weakest and the softest and they cave very easily. Trump gets on the phone and they all cave. Leadership gives them a cookie and they all cave. That's why they're less of a concern. That's why the people taking this right now are Chip, Roy and the Freedom Caucusers. They are the ones who have demonstrated time after time over the past decade that they will take the ball off the court and pop it and throw a huge tantrum. And they use that to get what they want. And that's what's happened right here. This thing tanked because of hardliners, not because of moderates demanding concessions in certain areas. So there's, there's, you know, understanding those components of it is I, I'm surprised that so many voted against it. People I didn't expect, I obviously expected, like Roy and Norman and whatnot. But the fact that there's a lot of people really upset with this thing indicates that it's much further away or there's a lot less common ground of agreement than previously thought. I thought they were all on the same page. Let's cut taxes, let's cut entitlements for the poorest people, let's go. And it turns out that's not the case. So there's going to be a lot of difficulty. They still have the blueprint from their original budget resolution to figure out how to do this. They just have to figure out a different way that will be palatable most importantly for the Freedom Caucusers because they have demonstrated they'll vote against things, but also there's concessions they need to find elsewhere. But we still don't know how serious a lot of these so called moderates are about this negotiation. They say they want something with a 4 in the number in terms of, you know, what the new state and local tax deduction is. It's currently at 10,000. I think the, the giveaway was around 30. They want it to be like at least 40. Maybe if they can't get there, they might all cave or demand something else. We'll see. Yeah.

Andrew Egger (12:09)

And the weirdest wrinkle of all this to me is that the softest figure in terms of, you know, the single Republican who's been the biggest obstacle to increased cuts to these, to benefits has not been these moderate Republicans. It's been Donald Trump who campaigned on no cuts to Medicaid care and Medicaid and Social Security on the campaign trail, you know, just last year. And so, you know, the problem, the sticking point with these budget hawks has been, you know, essentially saying the White House saying to them, look, you can, you can phase in some of these cuts, you can phase in some of this stuff, add these work requirements, just push it off until 2029. Like, don't don't let this stuff phase in during my current presidential term. And this has been the thing that they're, that they, you know, have been making a stink about today. Chip Roy was saying, I'm not comfortable with this package where all of the, the revenue cuts happen at the front end and supposedly we get the spending cuts later on. Right. But, but, but now, I mean, it isn't as though, you know, Donald Trump has this, like, deep sense of, of loyalty to, to like, the poorest among us. It's not like you could easily imagine this being a thing on which Chip Roy actually does manage to talk Trump down and does manage to get, you know, earlier spending cuts on, on Medicaid into this bill. So, so I don't know, I don't know what to expect from any of that. Anything else you're watching as we're, as we're going with all this stuff.

Unnamed Congressional Reporter (13:32)

If you're kicking people off of Medicaid leading into a general election cycle, that could be devastating. And it looks like people on the super far right do not care. They just want to do it. They want to spend that political capital while they have it, which is admirable in a twisted way. And whether Trump allows that and lets that go through, that's what we'll have to see.

Andrew Egger (14:00)

Yeah, you got to make hay while the sun shines. Okay, we can leave it there. Obviously, this is very much in flux. We'll be back. We'll be covering it. Hope you subscribe to the channel. Thanks for watching. Head over to the bulwulwork.com to read our stuff and we'll see you all next time.

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