CBO Sees Shifting Incomes in Big Beautiful Bill’s Bottom Line
CBO Sees Shifting Incomes in Big Beautiful Bill’s Bottom Line
According to the U.S. Congressional Budget Office, the House-passed budget reconciliation bill’s2 net effect on families annual income differs significantly by income.
Those with the lowest incomes would see reduced annual income, while the highest income families would see a net increase.
Reminder on Reconciliation: Our reconciliation overview explains how this fast-track simple-majority legislative process works.
What’s New: CBO has a new analysis examining how the bill affects annual income, finding:
The lowest income families would see $1,600 less, nearly 4 percent of their income.
Cuts to Medicaid and the Supplemental Nutrition Assistance Program (SNAP) are the core explanatory drivers for this shift.
The highest income families would see $12,000 more.
Tax policy changes are the core explanatory driver for this shift.
Why it Matters: Much media coverage is highlighting impacts on program access, the debt, and deficit. That excludes second-order economic shifts that could impact families and systems.
What it Means: Safety net policies typically counterbalance economic shock. Systems don’t typically plan to have fewer resources for struggling families right as economic risk rises.
What to Watch: This is a critical week in the Senate process, with likely text to drop later today.
The larger debt sustainability conversation is also deeply intertwined here. Wonks don’t just watch budgets; bond yields also signal trends that matter for child and family policy.