This ‘economic sugar high’ won’t last, CRFB warns, touting analysis predicting long-term stagnation and $600 billion of annual borrowing through 2028

How OBBBA drives short-term gains

Forecasts signal diminishing returns

Nick Lichtenberg is Fortune Intelligence editor and was formerly Fortune's executive editor of global news.

The Committee for a Responsible Federal Budget (CRFB) is warning the United States is experiencing an “economic sugar high” that will not endure, citing a new analysis of the recently enacted One Big Beautiful Bill Act (OBBBA).

According to the detailed assessment from the nonpartisan budget watchdog, OBBBA will deliver a significant boost to economic output in the near term, with estimates showing growth rates could climb

The analysis highlights several mechanisms through which OBBBA will stimulate growth in the short run. This includes the government borrowing $600 billion per year from 2026 through 2028, reductions in taxes on work and investment, and temporary expansions of incentives for businesses. These policies are expected to create a surge in demand and temporarily increase labor and capital supply, but the CRFB underscores these one-off effects will fade quickly as the economy adjusts—and particularly so if full employment persists.

The CRFB notes OBBBA supporters have argued the law will significantly accelerate economic growth, including the White House Council of Economic Advisers and Trump himself on Truth Social. This will be true in 2026 and 2027, the CRFB says, finding near-term economic growth will indeed be boosted, but sustained economic growth will not.

CRFB cautions the positive economic effects will be offset over time

The CRFB cited supporting estimates from the Tax Policy Center and Yale Budget Lab as largely agreeing with its own conclusions. Their models show OBBBA increasing economic output

The Congressional Budget Office and other think tanks also predict only modest or negative long-run impacts, despite a robust immediate stimulus. (The CRFB notes that CBO has not issued an estimate about the final legislation, but did release a dynamic score of an earlier House version of the bill.)

The CRFB notes the Council of Economic Advisors expects a similar pattern of a near-term stimulus boost of nearly 2.4% and a 4.75% increase in GDP in 2028, falling to 2.55%

CRFB repeatedly refers to the temporary “sugar high” from the OBBBA and compares it directly to another sugar high: the 2017 Tax Cuts & Jobs Act, or TCJA, from Trump’s first term. The growth that resulted from that law, it said, now appears in retrospect “to have represented a one-time boost to economic activity rather than a sustained increase in the rate of economic growth.” Roughly as expected, the economy grew

The CRFB finishes

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.