The budget reconciliation bill that President Donald Trump signed into law last month will take $1,200 a year from the poorest people in the U.S. while giving the richest an extra $13,600 a year—money they may hardly notice.
Even before Monday’s report from the Congressional Budget Office (CBO), we knew that Trump’s bill, which cuts social programs and reduces taxes for the wealthiest, would shift money from the poor to the rich. The difference is clear: the poorest will feel the loss much more than the richest will feel the gain.
The Yale Budget Lab used CBO data to show that the average household income for the lowest-earning 10% of Americans is $39,464. Losing $1,200 a year can mean skipping meals, falling behind on bills, or struggling with rent or car payments. In contrast, the highest-earning 10% earn about $517,103. Adding $13,600 to that amount makes little difference in their daily life.
The CBO shared these numbers on Monday after a request from four Democratic lawmakers: Senate Minority Leader Chuck Schumer and House Minority Leader Hakeem Jeffries, both from New York; Rep. Brendan F. Boyle from Pennsylvania, the ranking member of the House Budget Committee; and Sen. Jeff Merkley from Oregon, the ranking member of the Senate Budget Committee. The CBO’s letter responded to the Democrats’ “request for an analysis of the distributional effects” of the bill that Republicans called “beautiful.”
According to the CBO report, the average U.S. household will see a rise in resources between 2026 and 2034, but the benefits will not be equal. Households at the bottom will lose resources, while those in the middle and top will see increases.
The report specifically states that “Resources for households in the lowest decile (tenth) of the income distribution will decrease by about $1,200 per year (in 2025 dollars),” which is about 3.1% of their income. These decreases come mostly from cuts to programs like Medicaid and SNAP.
For the richest households, income is projected to rise about 2.7%, mainly due to tax reductions. In simple terms: poor families will have less money for food and health care, while wealthy families get a small boost in their bank accounts.
Even though Trump promised he wouldn’t cut Medicaid, and some Republican lawmakers claimed they wouldn’t support such cuts, the reality was clear. Republicans couldn’t give more to the rich without taking away money used for health coverage for poor people. By 2034, Medicaid is expected to cover 10 million fewer people.
The bill is also expected to remove 2.4 million people from SNAP, formerly called the food stamp program.
Instead of admitting the bill would hurt the most vulnerable, Republicans argued they were only targeting “fraud, waste, and abuse.” They also questioned the CBO’s accuracy. Rep. Jason Smith of Missouri, chair of the House Ways and Means Committee, claimed on social media that “CBO has a troubled track record of getting its estimates incorrect and, like Democrats, is biased in favor of more federal spending and higher taxes.” He added, “Don’t buy it.”
But the CBO is considered more reliable than the Republicans who call cutting food and health benefits “beautiful.”
Reading the report reminded me of a Bible story about a wealthy landowner who needed to feed a guest by taking his neighbor’s only sheep. That is essentially what Trump and Republican lawmakers are doing: the poor suffer greatly so the richest can gain a relatively small amount.
