The U.S. Senate last night passed Trump's "One Big Beautiful Bill Act" (OBBBA) with a vote of 51 to 50. This bill is a key legislative agenda for Trump's second term, covering tax cuts, border security funding, increased defense spending, and cuts to social welfare programs such as Medicaid and SNAP.
Currently, the bill has been sent back to the House of Representatives for final review, which needs to pass the Senate's modified version before July 4th to meet Trump's signing deadline.
Voting Process Intense and Fierce
The voting process reportedly lasted over 24 hours, involving intense debates and negotiations on multiple amendments. The Senate ultimately passed the bill with a narrow 51-50 margin, with Vice President JD Vance casting the tie-breaking vote.
Additionally, three Republican Senators - Susan Collins (Maine), Thom Tillis (North Carolina), and Rand Paul (Kentucky) - voted against the bill alongside all Democratic Senators, but failed to prevent its passage.
Musk Criticizes: Bill Enables Trump's Abuse of Power
Notably, Musk expressed dissatisfaction with the bill, criticizing on social platform X that the bill would enable Trump to abuse his power:
Defunding federal court order enforcement is the true core of this spending bill.While ostensibly targeting illegal immigrant deportation, it clearly opens up many other possibilities for presidential power abuse.Should this be allowed?
The bill extends the 2017 tax cuts and reduces various social welfare spending, with the $7,500 electric vehicle tax credit also being eliminated. For Tesla, which heavily relies on incentives to drive sales, this is essentially cutting off its lifeline. Musk had previously posted on X, calling the bill "despicable" and "thoroughly crazy and destructive", warning of potential loss of millions of manufacturing jobs in the US.
Trump: Crying Over a Missing Bottle?
In response, Trump recently mocked Musk on social media, saying he received more subsidies than anyone and is now throwing a tantrum over reduced subsidies:
"You've received more subsidies than anyone. Crying over a missing bottle? Then just close up shop and go back to South Africa."
Additionally, Trump suggested last night that the ASD should focus on Musk, which would save the government significant expenses, hinting at potential further challenges to Musk's industries in government collaboration and support.
Tesla Stock Drops 5%
Affected by this news, Google Finance data shows Tesla briefly dropped below $300 during last night's US stock market session, later slightly recovering to $301.41, but still experiencing a 5.11% intraday decline.
Analysis: Current Fiscal Path Will Lead to US Bankruptcy
Regarding the dispute between Musk and Trump, The Kobeissi Letter posted on X platform, pointing out that bankruptcy is the basic expectation under the current fiscal path:
The irony about Musk and President Trump's situation: Eliminating the US fiscal deficit could actually achieve all of Trump's economic goals in one go.
First, eliminating deficit spending would lower Treasury yields, as trillions of Treasury issuances would decrease. This would also reduce inflation, allowing the Fed to cut rates and calm the bond market. In fact, the bond market was the reason for the trade war's shift in April, as 10-year Treasury yields rose above 4.60%. To some extent, reducing deficit spending would enable Trump to apply more tariff pressure to reduce the trade deficit.
Moreover, while trade wars are seen as "short-term pain for long-term gain", this phrase truly applies to deficit spending reduction.
As Elon Musk continues to speak publicly about the debt crisis, more and more Americans are beginning to pay attention to this issue.
Since the stimulus programs of the pandemic era in 2020, our stance has been clear: bankruptcy is the basic expectation on our current fiscal path.
