By David Morgan
WASHINGTON (Reuters) – Donald Trump’s Republicans looked set on Wednesday to possibly win control of both chambers of Congress, giving them sweeping powers for the first time in eight years to ram through a broad agenda of tax and spending cuts, energy deregulation and border security controls.
But it would also force them to confront the dilemma of pursuing a Trump policy plan that could undermine the party’s long-proclaimed goal of reining in the government’s $35 trillion in debt.
Republicans secured a 52-48 U.S. Senate majority and were on track to expand their narrow House of Representatives majority, although 51 of the House of Representatives’ 435 races remained uncalled.
Early priorities are expected to include extending Trump’s 2017 tax cuts, funding the wall along the U.S.-Mexico border, cutting unspent funds allocated by Democrats, eliminating the Department of Education and curbing the powers of agencies including the Consumer Financial Protection Bureau, according to Republican lawmakers and aides.
The tax cut proposals Trump made on the campaign trail – from extending the 2017 tax cuts to abolishing tax on tips, overtime and Social Security benefits – could add $7.5 trillion to the nation’s debt over the next decade, according to the nonpartisan Committee for a Responsible Federal Budget.
The federal deficit ballooned to $1.833 trillion in fiscal 2024, as interest on the debt exceeded $1 trillion for the first time.
“We are ready to get to work for the American people,” House Speaker Mike Johnson said in an early morning social media post.
Trump repeatedly proved himself able to steer the party’s agenda during his four years out of power – notably by telling lawmakers to kill a bipartisan immigration bill early this year. Once returned to the Oval Office, his influence within the caucus will only be stronger.
No. 2 House Republican Majority Leader Steve Scalise told Reuters that lawmakers have been working with Trump for months to ensure that they can hit the ground running with “a real aggressive, bold, conservative first 100-day agenda.”
He said they aim to recreate the economic growth experienced early in Trump’s first term, before the COVID-19 pandemic struck in 2020 and sent the economy into a steep decline.
Republicans point to buoyant gains in federal tax receipts since 2017 as proof that Trump’s tax cuts raised revenues and say his current agenda will bring more of the same.
“History has shown when you reduce the overall tax burden on families, not only do their paychecks go up, but the amount of money coming into the federal government actually increases,” said Scalise. “As long as you’re controlling spending, that economic growth will actually get you more money to help pay down the deficit.”
But the revenue increase they cite is in nominal receipts driven by inflation and an expanding economy. That turns into a decline when the size of the economy is taken into account.
“The Trump tax cuts really did cut tax revenue, and what the Republicans are pointing to as phenomenal growth in tax receipts doesn’t actually exist,” said Marc Goldwein, CRFB senior policy director.
LEGISLATIVE HURDLES
For the past two years, members of the House Republicans’ unruly and narrow majority have repeatedly gotten in their own way, voting against bills backed by their leaders and leaving them to rely on Democratic support to approve must-pass bills.
Even a more disciplined Republican majority will face barriers, including the Senate rule known as the filibuster, which requires 60 of its 100 members to agree to pass most legislation, a threshold the new Senate will not clear with Republican votes alone.
A workaround, known as “budget reconciliation,” allows the Senate to pass budget-related matters with a simple majority. Republicans used this in the first two years of Trump’s first term, as did Democrats during the first two years of President Joe Biden’s term, when they had control of Congress.
Yet budget reconciliation is a limited power. Measures passed with this maneuver must be at least plausibly linked to revenues and spending.
In late 2021, the Senate’s parliamentarian rejected a bid by Democrats to use reconciliation to grant work permits to millions of immigrants living in the U.S. illegally.
Should the 60-vote filibuster rule block a Trump priority next year, he could call on Senate leaders to do away with it, as he repeatedly pressured them to do early in his first term, and as some Democrats urged early in Biden’s term.
Senate Republican leader Mitch McConnell upheld the filibuster against repeated Trump demands to ditch it during the president-elect’s first term.
McConnell will now step down as leader. While the top two candidates to replace him – John Thune and John Cornyn – have said the rule will stay, they and others who might seek the role have yet to face Trump’s direct pressure.
And McConnell predicted on Wednesday that the filibuster will remain.
“I think the filibuster is very secure,” the Kentucky Republican told reporters
(Reporting by David Morgan; Editing by Scott Malone, Alistair Bell and Suzanne Goldenberg)
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