Larry Kudlow: Trump Greenlights Bigger GOP Spending Bill, Criticizes CBO Scoring

Trump's Approval for Spending Bill

• 📌 President Trump has given Senate Republicans the green light to expand and improve the proposed spending bill.
• 💬 Trump indicated openness to changes, stating he would review modifications made by the Senate and potentially agree to some, even if significant.

House Speaker's Warning

• ⚠️ House Speaker Mike Johnson cautioned Senate Republicans against making excessive alterations to the House version of the bill.
• 🗣️ Johnson emphasized that the House version is superior to how it's being portrayed by the mainstream liberal media.

Deficit and Tax Cut Debates

• 📉 Critics claim the bill would increase the budget deficit by $3 trillion over 10 years, a claim Kudlow refutes by pointing to Biden's $2 trillion deficits.
• 📊 The Congressional Budget Office (CBO) is scoring Trump's tax cuts as a $4 trillion revenue loss, which Kudlow believes is inaccurate.
• 💡 Kudlow advocates for a growth-oriented policy baseline for scoring tax cuts, arguing that lower taxes spur economic activity, similar to the 2017 cuts.

Economic Growth and Revenue Projections

• 📈 Supply-siders, including Kudlow, believe Republican tax cuts could boost economic growth to at least 3%, potentially adding $4 trillion to revenue and reducing deficits.
• 💰 Tariff revenues, at a $200 billion yearly rate, could also offset the projected tax cut costs over 10 years.

House Republican Plan Fiscal Impact

• 📊 The House Republican plan aims to reduce Biden's spending as a share of GDP from 22.8% to 21.6% by 2034.
• 📉 The deficit as a share of GDP is projected to fall from 7.2% to 4.4%, and debt from 124% to 121.6%.
• 💰 A $3.7 trillion cost for tax cuts is reportedly offset by $1.5 trillion in spending cuts, resulting in a net cost of $2.2 trillion on a CBO basis.