(CTN News) – Trump needs to show Musk, voters, foreign investors, and Republican senators that his trillion-dollar tax package won’t put the US into debt.

Markets are afraid of cutting the deficit.

Right-wing According to American Enterprise Institute chief of economic policy research Michael Strain, “The tax law makes this official. There has been a lot of talk about cutting trillions of dollars in spending, but nothing has happened.”

“Adding a lot of money to the deficit is more risky because people are worried about how well Congress and the current administration are doing their jobs.” After the 2017 tax cuts, the White House opposed Trump’s first-term debt. On Thursday, White House Press Secretary Caroline Leavitt discussed taxes.

Leavitt said the “manifestly erroneous assertion” that the “One, Big, Beautiful Bill” worsens the deficit is based on weak assumptions and inaccurate estimates by the Congressional Budget Office and other evaluators during Democratic and Republican administrations.

House Speaker Mike Johnson remarked on “Meet the Press” on Sunday, “The CBO consistently miscalculates economic growth, but they sometimes get their projections right.” They usually don’t give enough weight to how tax and regulation cuts affect growth.

Republicans came together over tax cuts, not expenditure cuts, says Trump.

Last Thursday, Trump said, “We need to get many votes.” “We can’t cut back.” Few outside Trump’s tight circle think the government can stimulate the economy. The CBO’s executive branch spending assessment differs from Trump’s tariffs.

Musk adds, “I was disappointed by the big spending bill, which actually makes the budget deficit worse instead of better and hurts the work of the DOGE team.”

National debt is rising.

The House’s tax and spending cutbacks last month will likely add $5 trillion to the national debt over ten years, according to the Committee for a Responsible Federal Budget.

Many budget cuts ended. Congress must extend Trump’s 2017 tax cuts before 2018. But debt soared after 2008. Given the $36.1 trillion national debt, investors want high rates. Tax reforms in 2017 raised the 10-year Treasury Note rate from 2.5% to 4.5%.

The White House Council of Economic Advisers claims its policies will stimulate the economy, save the government money, and reduce budget deficits as a percentage of GDP. According to the council, 7.4 million jobs and 3.2% economic growth are expected in four years. However, CBO predicts 1.9%.

The council’s leader, Stephen Miran, told reporters that tariff income and White House growth estimates will address budget gaps. Miran believes tax cuts will grow US GDP without inflation by encouraging investment, employee involvement, and manufacturing.

“I want to make sure everyone knows that this administration is distressed about the deficit.” White House budget director Russell Vought told reporters the strategy “is fundamentally untrue that it is in any way harmful to debt and deficits.”

Analysts say Trump’s plan may not stimulate economic growth enough to reduce deficits.

Most non-government economists believe that increased debt will raise interest rates and slow economic growth by making it more expensive to borrow money for homes, cars, enterprises, and college.

Former Biden staffer Brendan Duke told the liberal Center for Budget and Policy Priorities, “This makes things harder for future policymakers.” Duke said Congress must address Medicare, Social Security, and tax cuts in 2028.

Smetters of the Penn Wharton Budget Model called Trump’s economic team’s growth predictions “a work of fiction.” He anticipated this would reduce Medicaid eligibility hours for workers.

Jason Furman, former Harvard University Obama Council of Economic Advisers director, remarked, “I am not aware of any credible forecaster who has substantially raised their growth projections due to this legislation.” Tax cuts rarely boost corporate growth or competitiveness. Interest rates restrict growth.

He dislikes budgeting, making it challenging for the Senate to discuss House tax and spending cuts. Debt worries Ron Johnson and Rand Paul. Johnson thinks senators can delay the accord until budget issues are resolved.

“I think we have enough reasons to stop the process until the president shows that he is serious about cutting costs and the deficit,” he adds.

Trump is a fan of tariffs.

The White House thinks that tariff money will remedy shortages, even though Trump’s declaration of an economic emergency over import taxes is being challenged in court.

In April, Trump declared that his tariffs on almost everything would cut the debt. Some people say that the budget deficit should be cut in half. He said two months ago, “It is our chance to thrive by using trillions of dollars to lower our taxes and our national debt, all of which will happen quickly.”

Glenn Hubbard, Zachary Liscow, and Douglas Elmendorf all think that growth lowers deficits. The Trump administration is correct. Yale Budget Lab economist Ernie Tedeschi says that “growth does not bring us closer to our goals.” Tedeschi suggested cutting the deficit by $10 trillion over ten years to stabilize the debt.

Most tax cuts hurt growth. “It keeps things the same,” Tedeschi added.

SOURCE: AP