President Donald Trump’s massive legislative package has hit a wall in the Senate. On Thursday, the Senate parliamentarian ruled that several key parts of the bill break the chamber’s rules and must be removed — dealing a major blow to Republican efforts to pass the legislation without Democratic support.
Senate Parliamentarian Elizabeth MacDonough said that multiple provisions violate the Byrd Rule, which limits what can be included in bills passed through budget reconciliation — the fast-track process Republicans are relying on to bypass a filibuster.
She struck down proposals that would have slashed funding for the Consumer Financial Protection Bureau (CFPB), eliminated the Public Company Accounting Oversight Board, cut pay for Federal Reserve staff, and reduced funding for financial regulatory agencies. One of the most controversial items would have capped the CFPB’s budget at zero, effectively shutting it down and cutting $6.4 billion.
Democrats quickly praised the ruling.
“The Senate Parliamentarian advised that certain provisions in the Republicans’ One Big, Beautiful Betrayal will be subject to the Byrd Rule – ultimately meaning they will need to be stripped from the bill to ensure it complies with the rules of reconciliation,” said Sen. Jeff Merkley (D-Ore.), the top Democrat on the Senate Budget Committee.
“As much as Senate Republicans would prefer to throw out the rule book and advance their families lose and billionaires win agenda, there are rules that must be followed and Democrats are making sure those rules are enforced,” he added.
But the parliamentarian’s ruling is only half the story. The bill is now facing a full-blown internal revolt from Senate Republicans themselves.
A bloc of hardline conservatives — led by Sens. Ron Johnson (R-Wis.), Mike Lee (R-Utah), and Rick Scott (R-Fla.) — is threatening to tank the entire bill unless major changes are made. Their demands? Bigger cuts to Medicaid, a faster phaseout of green energy tax credits, and deeper reductions to federal spending.
“There’s no way I vote for this thing next week,” Johnson told reporters.
“I don’t want to go the Nancy Pelosi route, ‘You got to pass this bill to know what’s in it.’”
The trio is pushing for sharper rollbacks of Medicaid expansion under the Affordable Care Act. Scott wants to cut the 90% federal match rate for states that expanded Medicaid, calling it a waste of taxpayer money.
“The focus should be on: How do we take care of what Medicaid’s original purpose was? It’s children and the chronically ill,” Scott said.
“Half the people, half the adults that are on Medicaid under the expanded FMAP are not working,” he added. “We’re running $2 trillion deficits.”
Lee is demanding a more aggressive phaseout of renewable energy subsidies created under the Inflation Reduction Act. He also wants to block tax benefits from going to undocumented immigrants.
“Green New Deal subsidies that don’t terminate by 2028 will effectively become permanent. If you don’t want them to be permanent, tell your senators!” Lee posted on X.
The three senators say they will vote as a bloc — and if all three vote no, the bill likely fails.
“Mike is handling the IRA provisions of this, Rick Scott is handling the Medicaid. You need to satisfy those two, too. All three of us have to be yes or none of us are yes,” Johnson said.
Meanwhile, other Republicans are sounding alarms about the political and real-world fallout of deep cuts to Medicaid and clean energy. Sen. Lisa Murkowski (R-Alaska), Sen. Susan Collins (R-Maine), and Sen. Josh Hawley (R-Mo.) are among those raising red flags. Collins is pushing for a “provider-relief fund” to help rural hospitals, nursing homes, and health centers weather the cuts.
But the internal fight is growing fiercer. Conservatives say the debt crisis is more urgent than protecting federal programs.
“The deficit will eat us alive if we don’t get it under control. If not us, who? If not now, when?” Lee posted on X.
Johnson is also calling out what he sees as hypocrisy in the bill’s numbers.
“The bill before us does not do it,” Johnson said, referring to Trump’s promise to balance the budget.
