Trump's "fiscal hawk" credentials collide with a $4 trillion deficit bomb

President Trump yesterday declared himself the biggest "fiscal hawk" in Washington.He then spent the next hour urging Republicans to unite behind the most budget-busting legislation in modern U.S. history.Why it matters: Trump's "big, beautiful bill" is projected to add trillions to the deficit over the next decade — rattling conservatives who have long warned that the U.S. is barreling toward fiscal catastrophe.Some Republicans now find themselves trapped between two of the party's most animating principles: Deficit reduction vs. absolute loyalty to Trump.That tension is threatening to derail Trump's vision for a new "Golden Age," which the White House hopes will begin in earnest with a vote on the House floor this week.State of play: Trump and his aides have brushed off warnings that his ambitious tax-and-spending bill — combined with his pledge not to touch Social Security and Medicare — could balloon the national debt, which now tops $36 trillion.White House officials emphasize they inherited sky-high deficits from the Biden administration, and say their policy mix of spending cuts, deregulation, tariffs, and pro-growth policies will bring them down.The White House Council of Economic Advisers projected that the bill would boost GDP by 4.2% to 5.2% in the short run — a staggering level of growth that goes far beyond the mainstream consensus.White House Press Secretary Karoline Leavitt went as far as to claim that the bill "does not add to the deficit," and that it would actually save $1.6 trillion through spending cuts and Medicaid work requirements.Reality check: Independent budget experts see that as laughable.The Joint Committee on Taxation projects the House reconciliation bill would increase deficits by $3.8 trillion through 2034.The Penn Wharton Budget Model projects deficits of almost $3.3 trillion, even when accounting for "positive economic dynamics."Moody's, which downgraded the U.S. credit rating on Friday, estimates that extending Trump's 2017 tax cuts alone — a central component of the bill — would add $4 trillion to the deficit over the next decade.What they're saying: "This tax bill's enormity is being underplayed ... [It] will cost more than the 2017 tax cuts, the pandemic CARES Act, Biden's stimulus, and the Inflation Reduction Act combined," Jessica Riedl, a budget specialist at the conservative Manhattan Institute, told Yahoo Finance.Jim Millstein, a former chief restructuring officer at the Treasury Department, warned that most deficit projections "assume consistent economic growth.""Just imagine the Trump tariffs ... cause a recession," Millstein told Bloomberg. "They are risking a fiscal disaster."The other side: Some Republicans argue that not passing the bill poses a more immediate threat. If Trump's 2017 tax cuts are allowed to expire, taxes would rise for 62% of filers, according to the Tax Foundation.Some conservatives also reject the notion that cutting taxes should be equated with the type of deficit spending that Congress approved during the Biden administration."If you think a tax cut is a cost, you're standing in the shoes of the government, not the American people," anti-tax activist Grover Norquist told the Washington Post. "Tax cuts are income to Americans and a loss to the bureaucracy."The bottom line: The cost of interest on America's national debt is already soaring. If rates remain as high as they are now, the U.S. could owe $40 trillion more in interest payments alone over the next 30 years.

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