President Trump's push for tax cuts has raised concerns from both fiscal hawks and economists regarding the increasing federal debt. Elon Musk openly criticized the plan, calling it a 'disgusting abomination,' which sparked a public rift with Trump. Despite warnings from the Congressional Budget Office predicting a $2.4 trillion increase in debt over ten years, congressional Republicans continue to support the legislation. Concerns are also voiced by experts like Maurice Obstfeld regarding rising global interest rates exacerbating fiscal risks, emphasizing the potential crisis ahead if debt levels continue to soar.
"All the talk about how this bill is going to generate an increase in our deficit is absolutely wrong," Senate Finance Committee Chairman Mike Crapo told reporters after a meeting with Trump last week.
Maurice Obstfeld, senior fellow at the Peterson Institute for International Economics, said the danger of fiscal crisis has been heightened by a potential rise in global interest rates.
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