Growth: That's Why Trump's Big Budget Bill Is Beautiful

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Here’s the main thing that matters in Trump’s Big Beautiful Bill: Does it produce or retard economic growth? If it produces growth, that means the deficit and other problems can be pushed off to the future, and the tax cut you get will help your own family to thrive and grow.

If a budget bill retards growth, then the deficit only will get worse, as will your family budget from higher taxes. A declining economy doesn’t help anybody except the Democrats who will seize that and win big in 2026.

Elon Musk is a brilliant engineer. He knows how to solve problems. But he’s looking at the wrong problem: the deficit. Certainly it’s a big problem. We should cut spending as much as we can, including on “defense,” which is going up instead. But the deficit is not the main problem. What is? Look above: Growth.

A great analysis comes from my friend Vlad Signorelli at Bretton Woods Research. Read his free Substack analysis here. He attacks a critique of the BBB by Ezra Klein and Matthew Iglesias:

It’s a familiar morality play -- fiscal ruin dressed in wonkish anxiety, delivered in concerned tones, citing “dynamic scores” as gospel for those who prefer neoliberal orthodoxy in podcast form.

But their critique collapses under scrutiny -- not just for the moral preening, but for the economic sloppiness. What Klein and Yglesias offer isn’t serious analysis; it’s a reflexive invocation of deficit fearmongering. They treat rising interest rates as fait accompli, ignoring contrary evidence and dismissing the evolution in fiscal thinking that followed the 2008 crisis.

Signorelli also attacks the Congressional Budget Office’s analysis of an additional $367 billion added to the debt over the next 10 years:

CBO models are not destiny. The Klein–Yglesias take elevates the CBO’s obviously flawed assumptions to the level of economic law. But history tells a different story -- and markets continue to confirm it.

I’ll add that reminds me of the old Soviet Five-Year Plans, which always were wrong because you can’t plan an economy. Although the CBO’s crystal ball extends twice as long, 10 years, as the 5 years of the CPSU — the Communist Party of the Soviet Union.

The fact is anyone is lucky to project even a state or local budget out 2 years. Expecting economic forecasts to hold up 5, let alone 10, years is less reliable than cutting open a chicken and reading the entrails.

The Democrats’ position is to attack the tax cuts for the “wealthy.” They pushing envy, while ignoring how the BBB’s tax cuts would help everybody, especially the middle class. Signorelli:

Critics might argue these provisions favor the wealthy, but that overlooks a broader truth. Sure, millionaire investors might reap bigger gains from an economic boom than wage earners -- but both see a quality-of-life upgrade across the spectrum. Rather than stew in a crabs-in-a-barrel mentality, resentful of shared prosperity, we’d do well to remember JFK’s maxim: a rising tide lifts all boats.

Even Yglesias concedes that the business provisions -- 100% bonus depreciation, R&D expensing, and estate tax relief -- are the elements most celebrated by conservative tax architects. But his own words, dismissing them as “only $700 billion,” betray how lightly he treats their long-term economic significance. These are the provisions most likely to shift business behavior, shape investment patterns, and drive productivity gains.

It’s also worth ponting out the “rich” the Democrats hate — unless they’re rich Democrats, like Pelosi and Bernie Sanders and Bill Gates — commonly are local businessmen who add to your local community. They’re the family that owns the dry cleaner, or the guy who built a collection of 10 fast-food joints who subsidizes the Little League team. They’re your neighbors. They also pay local, school and state taxes.

Some critics have warned the BBB will increase interest rates, making home and car purchases less affordable. Signorelli:

With more than $8.7 trillion in foreign-held Treasuries and real yields still anchored below potential GDP growth, there’s no evidence that these pro-investment policies will push rates meaningfully higher. Investors know better. The risk isn’t inflation -- it’s missing the opportunity….

The Real Story: Momentous, Investable Policy

Strip away the deficit panic and what remains is one of the most consequential tax reforms since the original Tax Cuts and Jobs Act, as it:

• Encourages investment.

• Protects intergenerational capital.

• Rewards work and entrepreneurship.

It gives firms certainty. It gives markets visibility and investors confidence. And unlike the ad hoc subsidies and the regulatory churn of the past few years, this is policy you can model, price, and bank on.

Any initial debt from pro-growth tax cuts isn’t a crisis -- it’s a self-liquidating liability as the economy expands.

If you're a portfolio strategist, allocator, or investor, the Klein–Yglesias narrative isn’t just incomplete -- it’s wrong. Their models predict doom. Markets -- and history -- say invest.

Rand Paul, Massie and Tillis are wrong in opposing this bill. They want to take us back to the “Root Canal Republicanism” of Bob Dole and other losers. Meaning they mainly want to cause pain to Americans, leading to victory by Democrats — who then always raise taxes, spending and deficits.

Finally, here’s the Tax Policy Center’s analysis of the tax cut you’ll get — in addition to extending your 2017 tax cuts:

Middle-income households would get an average tax cut of roughly $1,800 under all three measures: a bit more in the House bill and slightly less in the two Senate versions.

That’s what the Democrats and the bill’s critics like Musk aren’t telling you. I have a saying: Deficits are the government’s problem. Taxes are my problem. Cut my taxes!

Remember to subscribe to Vlad Signoreli’s Substack analysis here.

(Note: I’m available for all your freelance writing needs. Reasonable rates. Fast service. Brilliance. Email: writejohnseiler@gmail.com)