U.S. Treasury Secretary Scott Bessent issued a strong warning during a congressional hearing on Wednesday, stating that if Congress fails to pass the 'major beautiful bill' proposed by President Trump, the U.S. may face a massive financial crisis. In a conversation with Congressman David Kustoff, he said, 'Sir, I believe this could trigger a financial crisis of a magnitude not seen since the 2008-2009 financial crisis.'
This bill is considered a core component of Trump's economic agenda and primarily includes extending the key provisions of the 2017 Tax Cuts and Jobs Act. If Congress fails to push for the reimplementation of this bill, Bessent warned that current tax cuts will expire in the coming years, automatically increasing tax burdens and potentially resulting in up to $4 trillion in tax hikes, thereby 'destroying the financial system.'
The bill covers a wide range of content, including not only tax cuts but also measures to strengthen border security, increase the defense budget, and promote energy policy reform. Congressional Republicans are working to submit the bill to President Trump for signing before the July 4th Independence Day holiday, aiming to push for economic growth issues ahead of the elections.
Additionally, this massive bill contains a provision to raise the debt ceiling by $4 trillion, aimed at preventing the federal government from defaulting in the coming months. According to the latest forecasts from the Congressional Budget Office (CBO), the Treasury will run out of funds between August and September, and if the debt ceiling is not raised in time, the U.S. could face potential fiscal default risks.
Overall, Bessent's warning reflects the Treasury's heightened anxiety over the current policy deadlock and economic outlook, with the success or failure of the bill not only concerning tax policy but also relating to debt management and the stability of the entire financial system.
