The new tax bill signed by US President Donald Trump has passed the House and is awaiting Senate consideration. Despite some benefits for parents and workers, critics highlight the potentially devastating consequences for future generations.
Consequences of Debt Increase for Youth
Analysts warn that a $3 trillion increase in the federal debt will negatively impact future generations. According to Kent Smetters from the Penn Wharton Budget Model, 'Future generations are kind of left holding the bag.' As a result, a 40-year-old with a typical income might lose $7,500, while a 70-year-old in the same income bracket would gain $17,500.
Impact on Healthcare and Education
The bill cuts funding for programs like student aid and Medicaid, which covers 40% of births in US hospitals. This reduction in Medicaid will hit young parents hard. The debt burden is expected to lead to rising interest rates, making it difficult for young people to buy homes. John Ricco from the Yale Budget Lab predicts that, by 2055, mortgage payments could increase by $4,000 a year.
Benefits for Seniors and Debt for the Young Generation
While the bill introduces some benefits for families, such as $1,000 savings accounts for newborns, it fails to make it fairer for the younger generation. Analysts confirm that the benefits do not outweigh rising costs for low- and middle-income households. Wealthy seniors receive tax breaks, while Medicare and Social Security remain untouched.
The introduction of the new tax bill raises concerns among experts that it will contribute to 'intergenerational theft.' Elderly citizens stand to gain from the program, while the youth will bear the burden of increased debt.
