By a razor-thin margin of 215 to 214, the U.S. House of Representatives approved on Thursday President Donald Trump’s sweeping domestic policy bill — dubbed by the president as the “One Big, Beautiful Bill Act.” The legislation extends the 2017 tax cuts for another decade, slashes key social programs, and introduces a controversial 3.5% tax on remittances sent abroad.

Supporters hail it as a transformational package. Critics argue it's a dangerous remedy that could worsen the country’s fiscal and social health. According to the Congressional Budget Office (CBO), the bill’s tax provisions alone could raise the federal deficit by over \$4.8 trillion over the next ten years, while eight million people could lose health coverage due to Medicaid cuts.

The core of the proposal is to finance tax breaks — primarily benefiting the wealthy and corporations — by reducing social spending. Key provisions include:

• More than $700 billion in cuts to Medicaid, the public health insurance program for low-income Americans.
• Earlier enforcement of work requirements for Medicaid recipients starting in 2026.
• Phased elimination of clean energy tax credits.
• A new 3.5% tax on remittances sent from the U.S. to foreign countries.

This last measure sparked strong reactions in Mexico. President Claudia Sheinbaum called it a form of “double taxation,” noting that migrants already pay income taxes in the U.S. Mexican Ambassador Esteban Moctezuma welcomed the reduction from 5% to 3.5% as “good news,” but warned that final Senate approval would still deal a blow to millions of families.

In 2024, remittances to Latin America and the Caribbean hit a record \$161 billion, with Mexico alone receiving nearly $65 billion. In southern Mexican states like Chiapas and Guerrero, remittances represent over 13% of GDP.

One Vote, Many Divisions

House Speaker Mike Johnson quelled a rebellion from the party’s right flank by making key policy concessions, including stricter work requirements and faster cuts to green subsidies. He framed the bill in historic terms: “It’s the kind of transformational change that future generations will study one day. They’ll look back at this day as a turning point in American history.”

But hardline conservatives remain skeptical. Senator Rand Paul warned: “Once Republicans vote for this, Republicans are going to own the deficit.”

Senator Ron Johnson added: “In the House, President Trump can threaten a primary. He can’t pressure me that way.”

Democrats were equally scathing. House Minority Leader Hakeem Jeffries called it: “The largest cut to health care in American history... in order to enact the largest tax breaks for billionaires in American history.”

Despite Trump’s declining approval ratings since returning to office in January, his ability to unite the often fractured House Republican caucus showcased his continued dominance over the party. He personally visited Capitol Hill this week to push the bill forward.

Markets React

Following the House vote, Treasury yields surged — a reflection of investor unease with the potential fiscal impact. The 30-year bond yield climbed to 5.15%, its highest level since 2007. Stock indexes slipped: the Nasdaq dropped 0.4%, the S&P 500 fell 0.1%.

Analyst Ipek Ozkardeskaya from Swissquote Bank noted: “The rising rates are the market’s way of signaling a lack of confidence in the US government and its policy direction.”

What’s Next

The bill now heads to the Senate, where Republicans are expected to introduce significant changes. The goal is to send a final version to Trump’s desk by July 4, though the upper chamber is less susceptible to presidential pressure. Senators, who face reelection only every six years, are more insulated from short-term political consequences.

Still, Trump celebrated the House victory on social media: “THE ONE, BIG, BEAUTIFUL BILL has PASSED the House of Representatives!”
“This is arguably the most significant piece of Legislation that will ever be signed in the History of our Country!”

Time will tell whether that claim holds true — or whether this ambitious fiscal treatment ends up worsening America’s long-term condition.

With information from AFP