Wealthy versus Less Affluent: The Effect of the 'Grand Magnificent Law' - The Consequences of the Passed Large, Attractive Law
In a historic move, President Trump signed the "One Big Beautiful Bill" into law in July 2025, a legislation poised to bring significant economic and social changes to American citizens, particularly those in the poor and middle class.
Economic Impacts
The bill promises to be a game-changer, with the largest middle-class tax cut in history. A typical family is expected to receive up to $10,900 in additional take-home pay, and workers could see wage increases of up to $7,000. The bill makes permanent many provisions from the 2017 Trump tax cuts and exempts tips, overtime pay, and Social Security benefits from taxation. It also offers tax incentives to businesses that manufacture more in the U.S. and hire American workers, aiming to spur economic growth and job creation.
Border security and deficit reduction are also key components of the bill, with the largest one-time investment in border security and claims to reduce mandatory spending. These measures aim to restore fiscal sanity while fostering a pro-growth environment that could benefit middle- and lower-income Americans indirectly by promoting economic stability.
Social Impacts
Expanded Child Tax Credit and savings accounts for newborns are designed to provide direct financial support to families, which may alleviate poverty and improve economic security for children in low- and middle-income households. However, the bill enacts nearly a trillion dollars in cuts to Medicaid, according to the American Hospital Association (AHA). These cuts are expected to negatively impact access to healthcare for vulnerable populations—including children, seniors, disabled individuals, and veterans—which disproportionately affects the poor and middle class. The AHA warns that these reductions will likely result in fewer people having health coverage and diminished healthcare services in communities across the country.
Summary of Potential Long-Term Effects
While the bill promises significant economic benefits through tax cuts and pro-growth policies benefiting working families and businesses, the substantial Medicaid cuts raise concerns about diminished healthcare access and increased hardship among poorer and vulnerable citizens. The full social and economic consequences will depend on how these policies are implemented and their interaction with broader economic conditions.
As the U.S. national debt stands at about $36 trillion, the midterm elections for Congress are scheduled in late 2026, and Republican support among the population will depend on whether the positive effects of the "Big Beautiful Bill" materialize. The Democrats are likely to exploit the cuts to healthcare and social programs, as well as the impact on national debt, in their campaign for the upcoming midterm elections.
Critics argue that the "Big Beautiful Bill" could worsen medical care for millions of Americans, while Trump defends potential cuts to food assistance programs by stating they aim to remove illegal immigrants from these systems. If enacted, the "Big Beautiful Bill" could harm working-class families for generations, according to former President Barack Obama.
Trump has shifted into campaign mode, emphasizing that not a single Democrat voted for the "Big Beautiful Bill." He hopes to leverage the expected successes of the bill against the Democrats in the upcoming midterm elections. However, if the opposite happens, he could alienate voters who supported him partly because of his promise to lower costs for consumers.
References: [1] CNN, 2025. "Analysis: The 'Big Beautiful Bill' explained." [online] Available at:
- The European Parliament, Council, and Commission may closely watch the implementation and effects of the "Big Beautiful Bill," given its potential impact on American citizens' personal finance, particularly with regards to debt management and policy-and-legislation concerning taxation, with the bill made permanent many provisions from the 2017 Trump tax cuts.
- The European Parliament, Council, and Commission are likely to take note of the economics behind finance, personal-finance, and debt-management in the bill, as its politics and general news value lie in its claimed goal to bring significant economic changes, with a typical family expected to receive up to $10,900 in additional take-home pay, and workers seeing wage increases of up to $7,000.
- Keen on issues related to policy-and-legislation and general news, the European Parliament, Council, and Commission could scrutinize the social impacts of the "Big Beautiful Bill" in regards to healthcare, as it enacts nearly a trillion dollars in cuts to Medicaid, potentially leading to fewer people having health coverage and diminished healthcare services in American communities.
