How will Trump's Big Beautiful Bill impact US and global economies? | ABC NEWS

For more on this bill, let's bring in Brendan O'Connor, who is a professor of US politics and foreign relations. And he joins us now from Sydney. Brendan, welcome. Now, what are some of the biggest changes that we're going to see coming out of this bill? Well, I suppose the concern internationally will be for the debt that this will rack up if you have tax cuts at the same time that you're spending more money on immigration enforcement. There's quite some significant cuts for poor people in this bill food stamps, some of the Medicare stuff that you talked about. But that's not a huge amount of money. So this is going to increase foreign debt. The United States is also moving away in this bill from subsidizing renewable energy. So I suppose the kind of overall view I have of the bill is that it really doesn't take a very long term view of politics. It rather takes a very short term view of the people who maybe have funded the Republican Party really over the last 40 years. And there's a lot of similarities here with the 1981 tax cut bill brought in the Congress under the Reagan presidency, tax cuts under George W. Bush and tax cuts in the first year of the first Trump administration. So this is this is really sort of standard Republican sort of policy, but maybe a little bigger and a little bolder and certainly a kind of Trump styled name compared to the previous bills. Is there anything there that people may be pleased with such things as there was some stuff mentioned on tips, overtime and even tax cuts for blue collar workers? Those tip changes, I'm sure that people working in restaurant industry, working in some of those service industries that will be of benefit. But the big tax relief from this comes for much more wealthy Americans. And also, there was a lot of talk during the negotiations about gutting the IRS, the American Tax Department. So making it harder for the tax department to pursue people like Donald Trump, who often have, you know, run ins with about their taxation. So I think like the 1981 bill, the Kemp Roth bill and Bush's bill, I think the overall impact most analysts are saying will be an increase in income inequality in the United States, which has really been the pattern of most Republican presidencies that we've seen since the 1980s, that they favor the more wealthy over the very poor in the United States. And that gap just keeps expanding. And I think that will be the net effect of this bill. Do these changes have the potential to affect us here in Australia? Well, I think people who have superannuation in Australia might have been hearing about there were provisions to maybe tax Australian superannuation companies in the original draft. I think that's out now. The Australian superannuation groups have been on the web. I was investigating into that. Happy with the removal of that in broader terms. I think it just creates a kind of uncertainty that the United States, if it was to get expert advice from economists, would probably be addressing its debt problem. I think that's what most smart economists would say. So the ignoring of that debt problem, does that create instability with the U.S. dollar? Does this just sort of put all of these problems, the big kind of overall problems with the U.S. economy down the road for the next presidency? What about affecting the world globally? There is a lot of money that will be cut from here. Well, I think, you know, as we saw with Trump increasing tariffs just across the board, there was a bit of a sort of flight from the U.S. in some ways. The stock market obviously was incredibly volatile. And then it became more expensive for the United States to raise money to service its debt. The complexities of the bond market, which I won't get into it. You know, most of us struggle to get across. But the kind of short sort of summary of what was going on with those with those tariff increases and the global financial uncertainty was the U.S. was just having to pay more for its debt. And its dollar was decreasing. Now, this bill may feed into that as well. These are complex sort of issues, but I think there will be some sense that the adults still aren't in charge. And this bill is really about servicing the business community, wealthy Americans. This is about serving the traditional Republican kind of donors and the people of the Republican Party tend to look after in their major bills in the first year of any Republican presidency. OK, Professor Brendan O'Connor, thanks for joining us today. My pleasure.