Federal Spending and Tax Bill Will Harm Millions of Vulnerable Americans

By Laetitia Clayton

As America celebrated its independence on July 4, President Donald Trump signed into law his so-called “Big Beautiful Bill,” which is anything but beautiful for the nation’s most vulnerable people.

The bill, almost 900 pages, was rushed through Congress using the reconciliation process so Trump could sign it by July 4. He and Republican lawmakers celebrated passage of the bill, while not a single Democrat voted for it. A key part of the bill is an extension of Trump’s 2017 Tax Cuts and Jobs Act, which was set to expire at the end of the year, says a July 4 article from CBS News.

“The legislation would make most of the tax cuts permanent, while increasing spending for border security, defense and energy production,” the article says. “The bill is partially paid for by significant cuts to health care and nutrition programs, like Medicaid and the Supplemental Nutrition Assistance Program, or SNAP. The Congressional Budget Office estimates the bill would add $3.4 trillion to federal deficits over the next 10 years and leave millions without health insurance. Republicans and the White House dispute those forecasts.”

NASW has been sounding the alarm about the bill and urging its members to contact their members of Congress to let them know why they oppose cuts to Medicaid, SNAP and other safety net programs.

A July 3 news release from the association says NASW “is outraged that Congress has approved a budget reconciliation bill that will give tax breaks to the rich but makes massive budget cuts to Medicaid, SNAP and other basic needs programs that help the most vulnerable in our communities afford basic health care, put healthy food on the table, and keep up with the rising cost of rent, transportation and other necessities. This destructive legislation will also make it more difficult for future students to choose the social work profession and for current social workers to pay off their student loans.”

Medicaid

NASW Public Policy Associate Rachel Boyer, MSW, LMSW, wrote in a June 4 blog post—before the bill made its way to the Senate—that “Republicans in the House passed nearly $800 billion in cuts to Medicaid, the largest cut to Medicaid in history. Over eight million Americans could lose their health care coverage and the health system as a whole would be significantly impacted, leading to limited access to less care.”

In addition to Medicaid, Boyer’s post outlines some other areas of concern, including SNAP, tax credits, and student loans.

“Participation in Medicaid and SNAP currently helps streamline access to other resources, and clinical social workers would see the impacts of these cuts firsthand when families lose access to free and reduced school meal programs and Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) programs, further exacerbating nutrition deficiencies in this country,” Boyer wrote. “Families rely on SNAP to put food on their table and feed their young children. Cutting off access to this program hurts the very families with children the proponents of this bill say they are helping.”

Boyer said on July 7, after Trump signed the budget bill, that cuts to Medicaid ended up being even more than originally proposed, at nearly $1 trillion.

“The Medicaid cuts are huge,” she said. “This will hit rural communities hard. Some rural hospitals are already starting to make cuts.”

Student Loans

Boyer explained that the final budget bill eliminates or puts restrictions on certain federal programs aimed at helping people access higher education and paying off student loan debt.

The final bill adds certain restrictions to Pell Grants, reduces repayment options for federal loans, and eliminates Grad PLUS loans, which have allowed students to borrow up to the total cost of their education, minus federal aid. Beginning in July 2026, no new Grad PLUS loans will be available.

“The cost of college keeps going up,” Boyer said. “Every kid who is not from an independently wealthy family needs some type of support. This is now a huge barrier that makes school out of reach for a lot of people, including social workers.” She added that borrowers of color or those whose parent don’t have good credit will be disproportionately affected.

NASW Public Policy and Advocacy Manager Dina Kastner, MSS, MLSP, said NASW has been working with the Public Service Loan Forgiveness and Student Debt Crisis coalitions, and will continue this work to push for changes.

“The other thing is that elections really matter,” she said, adding that NASW plans to mobilize members before the midterm elections next year.

A Positive For Gender-Affirming Care

One piece of good news that came out of the federal spending bill is that the Senate had to drop the anti-trans stipulations, because they did not meet the Senate Byrd Rule. Earlier versions of the bill included denial of Medicaid funds for those receiving treatment for gender dysphoria. (Look for an article on this topic in the fall issue of Social Work Advocates magazine.)

Looking Ahead

The final bill postpones most changes until 2027, Boyer said, pointing out this is after the 2026 midterm elections. This could mean Republicans would keep their majority in Congress because people would not yet have begun to feel the effects of the cuts. If Democrats were to take control, then the effects could be blamed on them.

“That’s the challenge ahead of us,” Boyer said, adding that education will be key. “We can still work in community to make some changes, and protect each other.”

She urged social workers to pay attention to what’s going on at all levels of government to see who is making which decisions. For example, some states will have to determine how to pay for SNAP benefits.

“Start hyperlocal,” Boyer said. “If a city council has to reduce SNAP, pay attention to who they are saying deserves SNAP and who doesn’t. Learn what is going on, who is doing the things, so when it comes time to make a decision, you will know.”

Kastner added that even though this spending bill delivers devastating blows to the nation’s most vulnerable, the fight isn’t over.

“We have to keep moving,” she said. “The only way we’re to make real change is if everyone comes together and tries to push for what’s right.”