The House Budget Committee just released its budget resolution for Fiscal Year 2025, laying out a Republican-led fiscal blueprint aimed at advancing tax cuts, spending reductions, and debt management over the next decade. While the resolution does not contain specific policy changes, it provides broad fiscal targets and reconciliation instructions to House committees, directing them to develop detailed spending cuts and policy changes within their jurisdictions. This allows for increased spending in some areas—such as defense and border security—while mandating deep reductions in mandatory spending, particularly in health programs.

1. Massive Tax Cuts & Debt Increase

• $4.5 trillion in tax cuts over ten years.
• $4 trillion debt limit increase to accommodate policy changes.

2. Major Spending Reductions

• $1.5 trillion in spending cuts over ten years.
• House Energy and Commerce Committee is instructed to find $880 billion in savings, likely through significant Medicaid reductions.
• The Ways and Means Committee is expected to propose changes that would increase the deficit but offset cuts elsewhere.
• The resolution directs multiple committees to propose deficit reductions, meaning further cuts to social services, health programs, and income security programs will likely follow.

3. Health Spending Cuts and Potential Impact

• While specific policies are not included, committees must develop proposals to achieve the required spending reductions.
• Medicaid is expected to face substantial cuts, with reductions likely beyond work requirements that moderate Republicans previously debated.
• Changes could force states to shoulder more of Medicaid costs, potentially resulting in reduced eligibility or fewer covered services.
• Other health-related spending reductions could include cuts to Medicare provider payments, public health funding, and federal subsidies for healthcare programs.

4. New Defense & Border Security Spending

• $300 billion in additional spending for border security and defense over the decade.
• Proposed $150 billion increase in defense spending.
• $175 billion boost for border security.

5. Budget Reconciliation Strategy

• The resolution outlines reconciliation instructions, allowing Republicans to pass legislation with a simple majority in the Senate and bypass filibusters.
• It directs House committees to find ways to reduce spending or raise revenue in various sectors.

6. Republican Policy Priorities

• Cuts to regulations to promote economic growth.
• Expanded American energy production as a key economic driver.
• Deregulation of markets to reduce “bureaucratic red tape.”

7. Controversy & Political Dynamics

• Senate Republicans, led by Lindsey Graham, are working on a backup plan in case the House effort falters.
• Democrats strongly oppose the plan, warning about its potential impact on healthcare, social services, and overall economic stability.
• The resolution’s impact on Medicaid and potential loss of benefits is expected to create backlash from moderate Republicans and GOP governors.

This one-bill House approach stands in contrast to the Senate’s two-part reconciliation strategy, setting the stage for intense negotiations between the two chambers. The resolution is expected to be marked up in committee this week before moving to the full House for a vote.