Fact Check: "The House bill adds $3.8 trillion to the deficit by 2034."
What We Know
The claim that the House bill, known as the "One Big Beautiful Bill Act" (H.R. 1), adds $3.8 trillion to the deficit by 2034 is based on estimates from the Congressional Budget Office (CBO). According to a preliminary analysis by the CBO, the total effects of the bill would indeed increase the federal deficit by approximately $3.8 trillion over the 2025-2034 period. This estimate includes various factors such as changes in revenues and outlays.
However, the CBO also provided a more detailed breakdown of the bill's impact on the primary deficit, which is projected to increase by $2.4 trillion during the same period, as outlined in their dynamic estimate. This estimate reflects a reduction in revenues by $3.7 trillion and a reduction in noninterest outlays by $1.3 trillion.
Analysis
The claim is partially true because it simplifies a more complex financial picture. While the $3.8 trillion figure is accurate according to the CBO's preliminary analysis, it is important to note that this estimate encompasses a broader range of economic effects, including macroeconomic feedback that may not be fully accounted for in the primary deficit figure.
The CBO's dynamic estimate indicates that while the primary deficit would increase by $2.4 trillion, the economic effects of the bill would decrease the primary deficit by $85 billion, primarily due to increased economic output. However, this is offset by an increase in interest payments on the federal debt, which adds approximately $441 billion to the deficit due to higher interest rates resulting from the bill's provisions.
Additionally, an analysis by the Committee for a Responsible Federal Budget (CRFB) suggests that the bill would increase debt by about $3 trillion over the next decade, contributing to a significant rise in the debt-to-GDP ratio (CRFB analysis). This indicates that while the $3.8 trillion figure is supported by some analyses, other credible sources provide a more nuanced view of the bill's financial implications.
Conclusion
Verdict: Partially True
The claim that the House bill adds $3.8 trillion to the deficit by 2034 is partially true. While this figure is supported by CBO estimates, it does not capture the full context of the bill's financial impact, particularly the distinction between the primary deficit increase and total deficit increase due to interest payments. The complexity of the economic effects and the interplay between revenues and outlays suggest that a more detailed understanding is necessary to fully grasp the implications of the legislation.
