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Our first story was a perfect illustration of the inside-out absurdity of modern media, but in spite of it, we are starting to get an idea of why President Trump is so pleased about the OBBBA’s passage. The New York
Times ran an OBBBA article yesterday headlined, “States Brace for Added
Burdens of Trump’s Tax and Spending Law.”

Traditionally, a “tax and spend” bill means the federal government is
raising taxes to fund new or expanded programs— pork-barrel projects, entitlements, or some vote-buying boondoggle. But, putting the lie to the headline, the article described the exact opposite. “State governments,”
the Times admitted, “are bracing for impact as Washington shifts much of
the burden for health care, food assistance and other programs onto them.”

In other words, the headline is 100% fake news. The article is actually
about states crying about all the cuts, not about raised taxes or any new
pork, like the headline claimed.

Indeed, the cuts are massive, even historic. “Gov. Katie Hobbs of
Arizona,” the article continued, “has warned that even her state’s $1.6
billion emergency fund will be insufficient to weather what’s coming,
because ‘even if we cut every single thing in the state, we don’t have the money to backfill all these cuts.’”

Wait— I was wrong. These cuts are not just historic. They represent a
seismic rollback of the post-New Deal welfare state, arguably the biggest
since the 1960s.

Since LBJ’s Great Society, the federal government has steadily expanded
its role in health care, welfare, and income support. Medicaid, SNAP (food stamps), and other federal-state entitlements relentlessly grew under the assumption that Washington always foots the bill, while states got to administer the money.

OBBBA doesn’t just reform the welfare state; it deconstructs it. It’s the
first major paradigm shift since LBJ. And it’s political genius, because
the states must now shoulder the blame for cuts. The biggest reason nobody
ever cut federal Medicaid before was to avoid being blamed.

In other words, Trump offloaded the political cost. The feds pulled back
the money hose, but left the governors holding the empty bucket. Governors
now have to decide exactly what programs to cut.

Thanks to the Times’ fake news headline, skimmers will come away thinking
Trump just passed some kind of bloated welfare expansion. In reality, he detonated a $1 trillion cut to federal transfer payments. But the Times
doesn’t care; it’s panicking. This is not about informing readers— it’s
about desperately sacrificing logic to the gods of narrative.

The OBBBA piles on top of cuts the Administration was already making
without needing a law change. “Even before the bill’s final passage,” the
Times said, “state capitals were contending with a slowing economy and
federal spending cuts.” Haha, a slowing economy. Nice try. (Nothing in the article ever argued that point; it was just a drive-by lie.) By the Times’ reluctant admission, federal spending cuts were already underway— even
before Trump signed OBBBA.

According to the story, the OBBBA cuts an awe-inspiring $1 trillion from
state transfer payments over the next 10 years. Since the affected
programs include Medicaid subsidies, states must decide whether they want
to cut coverage, cut provider reimbursement rates, or backfill the
shortfall with new taxes raised from their own overtaxed citizens.

The cuts are so steep, so foundational, that key progressive figures
aren’t just objecting to the pain— they’re mourning it as though it were a philosophical defeat. “What’s happening in Washington, D.C., is
undermining everything we’ve been working on,” grieved Governor Laura
Kelly (D-Kansas).

Governor Andy Beshear (D-Ky.) called it “the worst piece of legislation
I’ve seen in my lifetime.”

Adding insult to injury, the OBBBA smartly shifts the burden of
administering the modified programs onto the states, so that the new OBBBA provisions didn’t add any federal costs to the law. For example, food
stamps (SNAP) now have a work requirement, but the states must enforce the
new federal requirement, or lose subsidies. Same with the Obamacare
exchanges; states must take over more of the paperwork and begin enforcing
new eligibility criteria.

Don’t feel bad for them. States got a record amount of money during covid.
Some states, like Florida and Illinois, were fiscally prudent and are now sitting on giant piles of emergency reserves. Other states (cough,
California, cough) went wild, funding every liberal dream program (via
sketchy no-bid emergency contracts) and are pretty much broke. In
California, state officials cried that OBBBA would “most likely” cause 3.4 million people to lose their (free) health insurance and at least 735,000 people to lose (free) food stamp benefits.

So that’s one. There were others.

Second, corporate media complained about even more cutting. The Times ran
the story yesterday, headlined, “What Trump’s Big Bill Means for Colleges, Student Loans and Grants.” The Times darkly prophesied that the OBBBA had “far-reaching implications.”

Once again, we find the OBBBA shoring up federal revenues rather than
depleting them. And not by taxing grandma’s groceries, but by targeting
the wealthiest, most bloated, most ideologically sold-out, and least accountable institutions in America: elite universities.

First of all, and most deeply encouraging, “the bill would expand the tax
on endowments.” Finally! These university hedge funds-with-classrooms have
been hoarding tens of billions in tax-sheltered wealth, while jacking up tuition and peddling cheap Chinese grievance studies. The OBBBA flips the board. It tells Harvard and Stanford: fine, if you want to operate like a
hedge fund, we’ll tax you like one.

The Times, without offering any specifics, suggested taxing endowments
would somehow reduce student financial aid, a preposterous claim that made
me choke on my coffee laughing.

Let’s get real: Harvard has a $50 billion endowment. That’s not a rainy-
day fund— it’s a financial Death Star. If the university gave every single undergrad free tuition forever, it wouldn’t even dent the principal. The bizarre idea that taxing a tiny sliver of that mountain of money will
cause some poor kid in Peoria to lose a Pell Grant is not just unserious—
it’s a parody of propaganda, decorated in ivy.

Haha, but what it might reduce is the endless gravy train of diversity
czars, DEI bureaucrats, and six-figure vice provosts for student safe
spaces— the elites’ continuous employment system. And that’s why they’re squealing. They’re not worried about poor students. They’re worried about losing the taxpayer-subsidized funding model that lets them warehouse
surplus woke graduate degrees in meaningless administrative fiefdoms. The
OBBBA doesn’t just threaten their money —which is bad enough— but it
threatens their jobs program.

A Senate amendment spared colleges with fewer than 3,000 students from the
tax. And the endowments will only be taxed at a fraction of personal
income tax levels. But it’s enough to cause the progressive establishment
to predict catastrophe.

Anyway, for Portland readers: taxing Ivy League endowments does not
increase the budget deficit or debt. It helps. The Times admitted that, according to CBO’s conservative estimates, “The student loan changes are expected to save the government more than $300 billion over a decade.”

But there was more cutting in education: to federally subsidized student
loans. The OBBBA now caps the amount the federal government —our tax
dollars— can use to backstop unpaid student loans. It’s win-win-win! The
only group that loses is the same arrogant, elitist university system.

Let us count the ways. First, taxpayers win, because they can stop footing
much of the bill for worthless trans-in-media degrees. Students win,
because they won’t get fooled into borrowing six figures for a useless
gender theory major. And they also win because market pressure will
finally return to higher Ed, which must now deliver more value and become
more efficient in order to compete.

Even the lenders win, since they can still offer guaranteed returns to
their investors, albeit on lower amounts, which helpfully reduces the rate
of defaults.

The only group that loses is the same arrogant, elitist universities that inflated tuition by soaking up limitless loan money like a sponge without growing value or services. For decades, they jacked up costs, confident
Uncle Sam would foot the bill. Now they’re howling because the gravy
firehose is getting kinked.

But wait. There’s more. More cutting.

The Times admitted the OBBBA will “remake American energy.” Its article
ran below the dramatic headline, “How the G.O.P. Bill Will Reshape
America’s Energy Landscape.”

You might well ask, how is the OBBBA “poised to remake American energy?”
The Times supplied the answer: “by slashing tax breaks for wind and solar
power and electric cars.” (Side note: cutting electric car subsidies is undoubtedly one of Elon’s biggest beefs with the bill.)

Portlanders, take note: “slashing green tax breaks” means increasing
federal tax revenues— again showing that the OBBBA is not a “spending”
bill, but more of a revenue-realignment bill. It’s another strategic step
in reducing the deficit without raising tax rates on productive citizens.

But zoom out further. There’s a deeper pattern emerging: the OBBBA systematically cuts funding pipelines to key progressive power centers,
like state welfare transfers, universities, climate lobbies, and left-
leaning nonprofits masquerading as energy startups.

These sectors weren’t just bloated— they were financial laundromats,
funneling taxpayer money into ideological projects and washing part of it
right back into Democrat coffers via consulting fees, campaign donations,
and cushy board seats.

The OBBBA doesn’t just cut spending— it cuts the hose. And right in time
to start the 2026 midterms fundraising cycle.

The Times is starting to realize there was a rope-a-dope, and it was the
dope. Yesterday’s furious headline screamed:

https://substackcdn.com/image/fetch/$s_!Pe5p!,w_1456,c_limit,f_webp,q_auto :good,fl_progressive:steep/https%3A%2F%2Fsubstack-post- media.s3.amazonaws.com%2Fpublic%2Fimages%2Fd91edbb6-b093-4cbf-922c- b247fa2504b9_1274x386.png

And there it is. This is why I held off commenting on all the tumult and
public conflict as the bill worked through the process— because most of it
was theater. Fake conflict. Fake resistance. Real strategy.

House Freedom Caucus members and GOP “budget hawks” put on a master class
in misdirection. They loudly criticized the bill, publicly aired
grievances, and repeatedly threatened to kill it— right up until the
moment it passed, right on schedule.

The Times, just now catching up, is calling it “a routine” at the Capitol:

https://substackcdn.com/image/fetch/$s_!tYw2!,w_1456,c_limit,f_webp,q_auto :good,fl_progressive:steep/https%3A%2F%2Fsubstack-post- media.s3.amazonaws.com%2Fpublic%2Fimages%2F89b61bc0-eddf-4245-8f59- 3edcd14e9b24_1302x346.png

They’re close, but they’re still missing the bigger picture: it might have
been ‘a routine,’ but it wasn’t routine. This was classic Trump 3-D chess.
Put on a show of losing and internal conflict. Lull your enemies. Then …
TAW!

While Democrats and their media allies were busy counting Republican
defections and popping popcorn, the trap was already slamming shut. And
now they’re stuck explaining how the biggest rollback of progressive
spending in decades passed while they were still smirking on MSNBC.

And remember the Planned Parenthood cuts— another strike at progressive fundraising. The progressive project might not be dead, but it is badly wounded. And it might even die.

Read more

https://www.coffeeandcovid.com/p/complications-saturday-july-5-2025

https://floppingaces.net/most-wanted/trumps-silent-revolution-how-he- shrunk-the-state-gutted-the-left-and-played-the-media-like-fools/

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