Karoline Leavitt's Con Artistry To Sell American Economic Destruction

Catch Her if You Can...Before Karoline Facilitates a Financial Meltdown

by David Shuster

Years ago, during the Monica Lewinsky scandal, Bill Clinton infamously said during his deposition about the affair, “it depends on what the definition of is is.” Clinton was impeached.

Too bad that particular option isn’t legally or practically available for Donald Trump’s Press Secretary, Karoline Leavitt. For, with Leavitt, every time she opens her mouth to opine on the The Republican Party’s tax and spending bill, what she means depends on what the definition of “saves” is.

At her May 22, 2025 press briefing, Leavitt stated, “This [budget] bill saves 1.6 trillion dollars for the American taxpayer. This bill saves 1.6 trillion dollars.” Which is true, in the same sense that it’s true you could fly if you stepped off the top of the Statue of Liberty.

In fact, the GOP tax and spending bill would add an estimated 3.3 trillion dollars to the national debt. Within the bill, there are cuts to Medicaid, student loan funding, climate change projects, and food assistance. But those cuts, or savings as Leavitt insisted, don’t hold a candle to the costs of extra defense spending and tax cuts for the very wealthiest of Americans.

Still, Leavitt’s very dextrous verbal gymnastics continued. She declared, “This is a very good bill for the American people, the American taxpayer.” Baghdad Bob couldn’t have read those talking points any better.

In Trump/Leavitt world, perhaps only wealthy taxpayers actually qualify as the “American people.” According to the non-partisan Congressional Budget Office, the top 20% of American taxpayers will receive approximately a 3.7% increase in after-tax income from the Trump tax cuts.

Yet, the bottom 20% of taxpayers will lose $800. Why? Because, their tax cut is so small it’s hard to see, and now they’ll they’ll be saddled with finding a way to pay for new costs from their loss of Medicaid or Medicare benefits.

Oh, and based on the new work requirements Republicans are enacting just to receive Medicaid, millions of people are going to lose their health coverage altogether. Just a small matter that will add enormous additional costs when cheaper preventative medicine is ignored, right up to the moment someone without health insurance, due to this bill, must visit an ER.

The bill has another problem that is spooking global financial markets -- the aforementioned debt. When the U.S. government spends more money than it collects, this creates a deficit. To cover this deficit, the government must borrow more money.

The U.S. Treasury department acquires the funds to do this by selling various types of debt securities. Investors purchase the securities, and the U.S. Government promises to repay the investors with interest in the future.

These debt securities include treasury bills, which mature within one year; treasury notes which mature between two and ten years; and treasury bonds which are long term, and mature in 20 to 30 years. These U.S. debt securities have long been considered the safest assets in the world, because the risk of the U.S. lacking the ability to repay its investors has been very low. For decades, the United States has been big, stable, and reliable, the very opposite of what we’ve become under Donald Trump.

But recently, Moody’s lowered the U.S. credit rating. And the bond market followed suit by raising yields. In other words, Bond traders see a growing risk of the United States defaulting on its debt obligations. So, the people who buy and sell these securities made the U.S. borrowing costs in the bond market (the yields) more expensive.

And when the bond market makes it costlier for the U.S. government to borrow money, these borrowing costs also go up for both American consumers and businesses. We are already seeing this happen, with borrowing costs increasing for credit cards, auto loans, mortgages, and business loans.

Several Wall Street analysts say market investors and traders have also been alarmed by Donald Trump’s lack of credibility. His tariff policy has been akin to the children’s game “red light/green light.” He can’t even seem to explain what tariffs actually do, much less his reasoning for placing them on various countries. Whimsical doesn’t even begin to do a description justice.

Recently, when Trump was asked about the government’s debt and fiscal responsibility, he declared, “I am a fiscal hawk. There’s nobody like me as a fiscal hawk.” Uh-huh. Clearly, Trump was channeling Karoline Leavitt’s very agile verbal gymnastics.

The bond market is clearly calling out Trump’s BS. A growing number of investors and traders around the globe are losing confidence in the full faith and credit of the United States under Trump. So, the odds of a U.S. financial meltdown are increasing.

Though with Trump and Leavitt, of course, it’ll depend on what their definition of “meltdown” is. They and their wealthy friends will be just fine.

David Shuster is an Emmy award winning broadcast journalist who is best known for his work at NBC News and as an anchor MSNBC. He is a contributor to Blue Amp and has his own Substack you can subscribe to here.

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