In the pressure cooker of the U.S. Congress, Donald Trump refers to the 'grand and beautiful' tax bill as quietly brewing a storm. On the surface, this is an integrated legislative attempt encompassing tax, immigration, energy, defense, and debt ceiling issues, but behind it lies a complex game spanning intra-party ideology, regional interests, and electoral pressures.
As House Speaker Mike Johnson's efforts to visit various factions of lawmakers on Capitol Hill become public, this bill's vote not only tests Trump's control over the party but will also become an important turning point for the Republican Party's future electoral fate.
One, escalating pressure from conservatives: healthcare, green energy, and deficit are firing on three fronts.
The libertarian faction within the Republican Party fired the first shot in the 'internal counterattack':
In the healthcare sector, they request to implement 'work requirements' for adults under the expanded ObamaCare early, hoping to cut spending under the Affordable Care Act and refocus healthcare resources on the poor, women, and children;
In the green energy sector, they advocate for the complete repeal of the clean energy tax credits under the Biden administration's (Inflation Reduction Act), arguing that these subsidies are 'artificially distorting the market', weakening the coal and natural gas industries, and affecting the stability of the U.S. power grid;
Fiscal hawks are resolute, calling for cuts in non-defense spending to 'prevent the debt ceiling from becoming a policy buyout tool' again.
In their view, Trump's new tax reform framework must restore 'fiscal discipline' and 'market rationality', otherwise it will just be another round of pre-election voter pleasing.
Two, moderate counterattack: retaining green subsidies and adjusting the SALT cap is a 'voter base necessity'.
Meanwhile, moderate Republican lawmakers from high-tax coastal states like California, New York, and New Jersey are also dissatisfied with the current bill's 'hard right tendency':
They strongly demand the elimination of the $10,000 SALT (State and Local Tax) deduction cap, believing that this cap severely impacts the tax fairness of the middle class in high-cost living areas;
In the green energy sector, their stance is in direct opposition to conservatives. Local businesses have already built their business models around these subsidies, projects are being implemented, and if subsidies are cut off, it will directly impact the local industrial chain.
As one Republican congressman from New York said: 'We can win these seats in 2024 because we captured middle-class and moderate voters. Cutting SALT deductions and green tax credits now is equivalent to uprooting the foundation of our votes.'
Mlion.ai's policy heat analysis module shows that discussions on social media regarding the SALT cap and green energy tax credits have continued to rise within Republican districts, becoming a focal point of current party 'electoral anxiety'.
Three, two letters, one game: green energy becomes the most intense battlefield.
In March, a rare scene of 'open letter confrontation' emerged within the Republican Party:
An open letter signed by 21 Republican congressmen calls for the retention of green energy tax credits, emphasizing that this policy has driven billions of dollars in investment, covering both clean and traditional energy facilities;
Subsequently, conservative lawmakers retaliated in their reply, pointing out that these subsidies are 'political engineering', arguing to stop the 'excessive transfusion' to new energy companies, claiming it deviates from the goals of U.S. energy independence, security, and employment.
This sharp conflict of positions exposes a deep division within the Republican Party regarding the direction of energy policy.
Mlion.ai's policy divergence index model analysis shows that the green tax credit and SALT cap are the areas with the most intense disagreements and the lowest likelihood of compromise in the current bill negotiation process. This also means they are likely the places where the bill could get 'stuck'.
Four, Trump's calculations: can the comprehensive legislative framework stabilize multiple parties?
Trump hopes to break the long-standing deadlock with this 'super legislative package' while vying for fiscal discourse ahead of the 2026 midterm elections. He calls it 'grand and beautiful' because it attempts to satisfy simultaneously:
The conservative desire for fiscal tightening;
Moderate considerations regarding local election conditions;
The business community's call for policy stability;
And their own 'performance display' in re-election campaigns.
But the reality is that the more this bill integrates, the broader the interests it touches. To pass it in one go requires not only consensus within the party but also a strategic compromise.
Five, future path: escalation of the game, emergence of policy pricing space
From the perspective of capital markets, policy games mean that the 'risk of legislative uncertainty' will intensify in the short term, which may cause fluctuations in specific industries:
If the green energy tax credit policy is restricted, it will hit the stock prices of some new energy companies;
If the SALT cap is not lifted, consumer confidence among real estate and middle-income groups will be damaged;
Tightening of healthcare insurance will affect the valuation models of medical services and insurance companies.
Mlion.ai's AI policy simulator and industry impact mapping system suggest that investors focus on the following two directions:
Adjust relevant sector allocation strategies in a timely manner according to the dynamics of bill negotiations;
Track the frequency and tone of specific lawmakers' policy statements on social platforms and during hearings to identify potential 'policy turning points'.
Conclusion: When ballots, budgets, and ideals collide, even grand legislation can come to a sudden halt.
The 'grand and beautiful' bill is turning into a 'thorny and complex' political exam. How the Republican Party handles internal divisions will directly determine whether it can push this bill to the finish line — and whether it will still hold a congressional majority in 2026.
Plans are easy to formulate, but difficult to implement. When policy becomes the touchstone of compromise, we need data to understand the resonant rhythm between politics, the market, and public opinion.
Disclaimer: The above content is for information sharing only and does not constitute any investment advice!
