Federal spending has risen sharply during the first seven months of the fiscal year—yet rather than triggering panic, it’s sparked decisive action from the newly re-empowered Republican Congress. Under the clear direction of President Donald J. Trump, Republicans are moving forward with a sweeping reconciliation bill that promises not only to rein in reckless spending but also to deliver the kind of pro-growth tax cuts that fueled the booming Trump economy before Biden-era mismanagement sent the nation spiraling into inflation and debt.
After President Trump’s commanding 2024 victory, which handed Republicans control of both chambers of Congress, GOP leaders initially floated the idea of passing two separate bills—one for spending and one for tax cuts. But in true Trump fashion, the party decided to go bold: combining both efforts into one comprehensive, America First budget package that can bypass the Senate filibuster through reconciliation.
The package is expected to be finalized and potentially passed by early July, though negotiations are still ongoing. President Trump has publicly called for a “big, beautiful bill”—one that cuts taxes for working Americans, eliminates government waste, and delivers long-overdue reform to bloated entitlement programs like Medicaid. It’s a sweeping plan to refocus the government on serving the American people rather than funding progressive pet projects and globalist handouts.
According to the Congressional Budget Office (CBO), the federal government spent a staggering $2.4 trillion between January and April 2025—up $196 billion from the same period last year. That alarming increase, a result of lingering Biden-era appropriations and automatic entitlement growth, has only strengthened the GOP’s resolve to make major changes. The U.S. still borrowed over $1.1 trillion in just seven months, a clear sign that business as usual is no longer sustainable.
While Democrats and their media allies try to blame the fiscal imbalance on Trump’s proposed tax cuts, conservative policy experts note that Trump’s 2017 tax reform package actually led to increased revenues due to economic growth. What’s changed since then is the out-of-control spending—much of it driven by Biden’s failed Build Back Better agenda and the unchecked expansion of federal agencies during his term.
The Committee for a Responsible Federal Budget (CRFB), a traditionally centrist watchdog, acknowledged that April tax receipts modestly reduced borrowing by $5 billion, but even they recognize that structural reform is needed. CRFB President Maya MacGuineas called for serious attention to the fiscal outlook, though she notably criticized unpaid tax cuts—a claim that Trump’s team has repeatedly rebutted with strong economic data from his first term.
Within the GOP, conservatives are pushing hard for deep Medicaid reforms, work requirements, and efficiency mandates to root out abuse in the system. House Freedom Caucus members argue that entitlements must be modernized to prevent collapse—and to ensure that taxpayer money helps those who truly need it.
Some moderate Republicans have expressed concerns over proposed changes to Medicare, penning a letter to House Speaker Mike Johnson. But Trump has made it clear that Medicare will not be touched in ways that harm seniors—his goal is to ensure these programs are solvent, not gutted.
Speaker Johnson, working closely with Trump and the White House, is trying to thread the needle: crafting a bill that reflects conservative values while still being passable in both chambers. With only about a seven-seat margin in the House and a slim GOP majority in the Senate (53 seats), every vote counts.
President Trump has laid out a bold vision for tax reform. His proposals include eliminating federal taxes on tips (a direct benefit to service industry workers), scrapping taxes on Social Security benefits for seniors, and ending taxation on overtime pay—measures that would inject immediate relief into middle-class wallets and reward hard work.
While some insiders suggest the final tax cut package could total around $4 trillion, with $1.5 trillion in spending reductions, the specifics are still being hammered out in committee. What’s clear, however, is the contrast between Trump’s pro-growth, pro-worker tax policies and the Biden-era tax hikes that strangled small businesses and triggered job losses across America.
Critics point to the CRFB’s projection that the full cost of continuing Trump’s 2017 tax cuts and implementing new proposals could reach $11 trillion over a decade. But what they conveniently ignore is the growth multiplier effect. Trump’s economic model doesn’t rely on redistribution or artificial stimulus—it relies on unleashing American productivity and shrinking the regulatory state. The result? More jobs, higher wages, and more tax revenue without raising rates.
Senator John Cornyn (R-TX) has acknowledged the difficulty of getting the bill passed before the July deadline, particularly given the looming debt ceiling. But he emphasized that Republicans understand the stakes—and failure is not an option.
The House and Senate have both passed a joint budget resolution with reconciliation instructions. According to CRFB data, the Senate’s version allows for a net $5.8 trillion deficit increase over the decade (to accommodate front-loaded tax cuts), while the House version permits a $2.8 trillion increase. These figures reflect differing budget philosophies, but both signal a major break from Bidenomics and a return to Trump-style economic leadership.
The reconciliation process is now in full swing. House committees are actively reviewing provisions, with spending cuts still under negotiation. Tax relief measures are more advanced, as Republicans rally around Trump’s worker-first tax agenda.
This budget bill represents a historic opportunity. It’s not just a test of fiscal policy—it’s a test of political will. Can the GOP come together to cut waste, reform government, and unleash economic growth? With President Trump leading the charge, there’s every reason to believe they can.
Americans elected Trump in 2024 to fix what Biden broke. Now, with full control of Congress, the opportunity is here. A unified GOP can deliver tax cuts for families, rein in the administrative state, protect entitlements, and put America back on a path to prosperity.
RedState will continue monitoring every development, but one thing is clear: Trump’s vision for America’s economic revival is alive and well—and if Republicans follow through, it could mark the most consequential conservative legislative achievement since the Reagan Revolution.
