Republicans on Capitol Hill are betting the farm on President Trump’s domestic agenda.
The massive legislative package features the tax cuts, energy production and immigration crackdown that helped Trump secure a second term, and GOP leaders in the Capitol are eager to pass it quickly to boost an embattled White House ally whose approval ratings have fallen underwater.
But there are hazards lurking as well.
To offset the massive cost of the tax cuts, House Republicans have proposed tougher eligibility rules for Medicaid benefits; new limits on nutrition assistance for low-income families; and a rollback of clean-energy tax credits adopted by former President Biden. Each of those programs currently benefits untold voters in GOP-held districts, creating the potential for a political backlash against Republicans in the 2026 midterms and beyond.
By charging ahead with the most controversial elements of the package this week, with three powerful committees considering the tax provisions, health care cuts and food stamp restrictions, Republican leaders are rolling the dice that the benefits of Trump’s domestic wish list will, in the eyes of voters, outweigh the erosion of federal services — a gamble that could decide which party controls the levers of power in Washington for years to come.
Cutting Medicaid, in particular, is unpopular even with Republican voters. And while GOP leaders opted against some of the steepest cuts on the table, their bill would still lead to 8.6 million people losing health coverage, according to a Congressional Budget Office analysis requested by Democrats. Some conservative spending hawks suggested this week that they’ll oppose a final bill unless the Medicaid cuts go even deeper.
As the Energy and Commerce Committee met Tuesday to consider hundreds of billions of dollars in cuts to the low-income health care program, Democrats were practically drooling at the opportunity to campaign against battleground Republicans who support legislation that could leave their own constituents uninsured.
“The American people do not support this extreme and toxic bill, and we're going to hold every single House Republican who votes for it accountable,” House Minority Leader Hakeem Jeffries (D-N.Y.) told reporters Tuesday in the Capitol.
“They literally are signing their own political death warrants in terms of the 2026 elections.”
It’s not only Democrats sounding the warnings.
Steve Bannon, a former Trump adviser who now hosts a popular pro-MAGA podcast, has advised Republicans to steer clear of cuts to the health coverage safety net.
“Medicaid you've got to be careful with, because a lot of MAGA is on Medicaid,” Bannon said earlier in the year.
Much more recently, Sen. Josh Hawley (R-Mo.), a staunch Trump supporter, raised plenty of eyebrows when he cautioned House Republicans against the steep Medicaid cuts being pushed by conservative spending hawks. Writing Monday in The New York Times, Hawley said such cuts are “both morally wrong and politically suicidal.”
“If Congress cuts funding for Medicaid benefits, Missouri workers and their children will lose their health care. And hospitals will close. It’s that simple. And that pattern will be replicated in states across the country,” he wrote.
“Our voters support social insurance programs,” he added. “More than that, our voters depend on those programs.”
Even a poll conducted by Trump’s campaign pollster back in March pointed to political risks for Republicans over Medicaid. The McLaughlin & Associates poll of battleground congressional districts found strong support for Medicaid and political risks for those who seek to cut it.
“Half the folks in the country know somebody — either they, themselves, or they know somebody — who’s been on Medicaid,” Jim McLaughlin, president of McLaughlin & Associates, told The Hill. “So … they get it. It's important.”
But on the other hand, McLaughlin said that voters agree with many of the changes that Republicans are seeking, like rooting out “waste” and “abuse” and imposing work requirements for “able-bodied” adults, if they can show more of the benefits are going to Medicaid’s initial targets, such as pregnant moms and the disabled.
“They can actually increase benefits and services to people that rightfully need and deserve Medicaid — you know, the people that it was meant for,” McLaughlin said.
The tax piece is also proving a challenge for GOP leaders.
Republicans and outside groups advocating hard for extending the tax cuts argue that providing businesses and the market tax code certainty could boost the economy — and the sooner the better, they say, so voters can feel the effects before the 2026 election season.
“For the Republicans to do well during the midterms, people have to feel better about the economy, about their own financial situation,” McLaughlin said.
Acting to the Republicans’ advantage, the extension of Trump’s 2017 tax cuts is widely popular, since it would benefit most working-class Americans. Acting to their disadvantage, some taxpayers might not notice the tax benefits, since they largely represent an extension of current rates.
An expiration of the tax cuts, on the other hand, would be felt immediately by millions of Americans, which has made extending them that much more crucial to the Republicans’ political prospects.
Standing in their way has been a long internal dispute over the fate of the $10,000 cap on the state and local tax (SALT) deduction. Although Republicans established that cap in their 2017 law, moderate Republicans in high-income states such as New York and California are now demanding that it be hiked dramatically, or they’ll oppose the entire domestic package.
The Ways and Means Committee met Tuesday to consider their tax code changes. But a proposed increase in the cap — from $10,000 to $30,000 for those earning less than $400,000 — met with cold reception from proponents of a much higher hike.
Some took out their frustrations on the committee’s chair, Rep. Jason Smith (R-Mo.).
“The chair should be reminded that he wouldn’t have a f---ing gavel without the members of the SALT Caucus,” Rep. Mike Lawler (R-N.Y.) said on Tuesday.
Changes to the health care system, in particular, have a history of resonating with voters in ways that can prove enormously consequential to the power dynamics in Washington.
In 2010, after former President Obama enacted his signature health care law — unpopular at the time — Americans went to the polls and decimated the Democrats who supported the bill. In the House, the party lost 63 seats and remained in the minority wilderness for another eight years afterward.
Trump’s first-term effort to repeal ObamaCare suggests similar lessons. By that time, the program had taken hold and gained in popularity. And although Republicans did not succeed in killing the law, polls indicated it was a factor in the Republican losses in the 2018 midterms — a cycle that hasn’t been forgotten by Democrats amid the current debate over the future of Medicaid.
“You all didn't learn your lesson?” Jeffries asked Tuesday. “How'd that work out for you in 2017 and 2018?"
Mychael Schnell contributed reporting.
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