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7 Jun 2025 1:53
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  •   Home > News > International

    What is the Big Beautiful Bill and why are Elon Musk and Donald Trump fighting over it?

    A rift is brewing within the US Republican Party as President Donald Trump attempts to muscle his Big, Beautiful Bill through Congress.


    A rift is brewing within the US Republican Party as President Donald Trump attempts to muscle his Big, Beautiful Bill through Congress.

    Billionaire ally and former Department of Government Efficiency spearhead Elon Musk on Tuesday made headlines for his criticism of the proposed act, calling it an "abomination".

    Here's a look at what is in the bill, and why not all Republicans are backing it.

    What is the Big Beautiful Bill?

    Its full name is the One Big Beautiful Bill Act, but it's also shorted to the OBBBA or BBB.

    In essence, it is a budget reconciliation bill — a tool to fast-track policy around spending, revenue and the debt ceiling.

    The 1,038-page bill rolls together hundreds of proposed changes from tax cuts to changes to social benefits programs.

    What's in it?

    Here's an overview of some of the key changes put forward in the One Big Beautiful Bill Act.

    Court restrictions

    Experts have warned a single sentence in the bill would weaken the powers of federal judges to enforce contempt when the government defies the court.

    "No court of the United States may enforce a contempt citation for failure to comply with an injunction or temporary restraining order if no security was given when the injunction or order was issued," the provision says.

    According to Reuters, "security" in this case refers to monetary bonds that can be used when injunctions are issued.

    If the injunction is later reversed, the bond helps cover the defendant's losses.

    The Trump administration argues the provision would deter frivolous lawsuits, but Democrats argue it would leave judges powerless to rein in defiance.

    Golden dome

    On social media, Mr Trump has claimed the bill would secure funding to develop a network of missile defence systems.

    The BBB would provide a $US25 billion ($38 billion) initial investment to develop the "golden dome".

    The Congressional Budget Office has estimated the cost of developing a sophisticated missile defence system could exceed $US500 billion.

    The bill would also commit $US21 billion to restock the US ammunitions arsenal and $US34 billion to expand its naval fleet.

    Immigration

    Mr Trump would revive construction of the wall along the US-Mexico border, which he began during his first term, with a $US46.5 billion injection.

    The bill would also set aside $US4 billion to hire thousands more Border Patrol and customs officers, and a further $US2.1 billion for signing and retention bonuses.

    Asylum seekers would be required to pay at least $US1,000 on filing an application for asylum.

    While it would be a first for the US, other nations charge a fee for asylum applications, but the costs are significantly lower — $45 in Australia's case.

    The debt ceiling

    The debt ceiling is a limit on the amount of money the federal government can borrow.

    The BBB would raise it by $US4 trillion to $US40 trillion.

    Medicaid

    The bill would introduce additional restrictions on Medicaid, a joint federal and state program that helps cover medical costs for millions of elderly, disabled and low-income earning Americans.

    That would include a requirement for able-bodied adults with no dependents to work at least 80 hours a month to qualify for benefits, starting December 2026.

    Recipients would also need to reapply for benefits every six months, rather than every year.

    Republicans also hope to strip Planned Parenthood of funding from Medicaid.

    As well as providing abortion care, the organisation offers cancer screenings, pap smears and birth control.

    No tax on tips, overtime

    One of Mr Trump's key campaign promises — to end taxes on tips and overtime pay — would be ticked off by the BBB.

    The bill would also temporarily increase the Social Security income tax deduction of up to $US4,000 for recipients aged 65 and over.

    Snap benefits

    The One Big Beautiful Bill Act would introduce work requirements to able-bodied recipients of the Supplemental Nutrition Assistance Program (SNAP) who do not have dependents.

    More than 40 million low-income earners rely on SNAP to boost their grocery budgets and access nutritious food options.

    The bill would also require states to contribute more to the program, which is partly funded by the federal government.

    Student loans

    All existing student loan repayment plans would be replaced with just two classifications: a fixed rate monthly repayment plan over the course of 10 to 25 years, or an income-based "repayment assistance" program.

    It would scrap current rules that allow borrowers to temporarily defer their loan repayments due to financial hardship or unemployment.

    Tax cuts for high earners

    On average in its first year the BBB would deliver the nation's wealthiest an extra $US389,280 through tax breaks.

    At the other end of the scale, the lowest income earners will take a $US1,035 pay cut.

    Why did Musk attack it?

    Mr Musk has been an outspoken critic of the bill in the past.

    He argues the bill's spending would increase the "already gigantic budget deficit" and "burden America citizens with crushingly unsustainable debt".

    The South Africa-born tech investor worked as a consultant for the administration's Department of Government Efficiency until recently, working to slash government spending.

    He's often noted the US pays more interest on its debts than it spends on defence.

    Independent analyses have found it will add between $US2.5 trillion and $US3.1 trillion debt to the US budget.

    Government debt is already roughly 121 per cent of the nation's GDP and has grown exponentially in recent years to exceed $US35 trillion.

    [INTERACTIVE: US national debt graph]

    "This massive, outrageous, pork-filled Congressional spending bill is a disgusting abomination," Mr Musk wrote on social media on Tuesday.

    "Shame on those who voted for it: you know you did wrong. You know it."

    According to The New York Times, others close to the congressional negotiations have suggested Mr Musk was unhappy with a measure in the bill that would scrap electric vehicle subsidies.

    House Speaker Mike Johnson acknowledged the change would negatively affect Tesla, but said he did not believe the government should subsidise a transition to electric vehicles.

    "I know that has an effect on his business, and I lament that," Mr Johnson said.

    What is the bill's current status?

    The bill narrowly passed the House of Representatives in May by a vote of 215-214.

    It's now with the Senate, where the bill is likely to be held up further, despite the Republican majority.

    Some senators have already indicated they intend to make changes to the bill, which would send it back to the House of Representatives for another vote.

    Rand Paul, a GOP senator for Kentucky, said he was "just not open to supporting [a] $5 trillion … debt ceiling increase", which the bill currently includes.

    In response, Mr Trump took to social media on Tuesday to voice his disapproval of the senator, telling his Truth Social followers Mr Paul "never has any practical or constructive ideas".

    "His ideas are actually crazy (losers!). The people of Kentucky can't stand him," Mr Trump wrote.

     In other social media posts, he has urged senators to pass the bill "AS SOON AS POSSIBLE".

    "There is no time to waste," he posted on May 22.

    Both the House of Representatives and the Senate will need to sign off on the bill if it gets enough senatorial support.

    Mr Trump will then have 10 days to sign or veto it.

    House Speaker Mike Johnson has predicted the bill will be signed by July 4.

    Is the bill likely to pass?

    Given the bill was only passed in the House of Representatives with the finest possible margin of support, even a small loss of support could hold it up indefinitely or kill the bill entirely.

    Even if Republicans who back the bill manage to get it through the Senate without changes, it's highly possible it won't be signed off.

    Since the House vote, representative Marjorie Taylor Greene has voiced her regret about supporting the bill, and indicated she will not vote in favour if it returns to the House for approval without changes.

    In a post on X, the outspoken GOP politician said she was not aware the bill would block states from regulating artificial intelligence industries for a decade.

    "I am adamantly OPPOSED to this and it is a violation of state rights and I would have voted NO if I had known this was in there," she said.

    "This needs to be stripped out in the Senate."

    © 2025 ABC Australian Broadcasting Corporation. All rights reserved

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