On The Money — Democrats pounce over Social Security, Medicare plans

Democrats are turning up the heat on Republicans over their plans to change Social Security and Medicare. We’ll also look at how the House GOP could use the debt ceiling to get concessions next year, the Biden administration’s push for bond market reforms, and more.

But before you catch up, maybe check on the McRib fan in your life?

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Democrats ramp up attacks on GOP plans

With election day just over two weeks away, Democrats are ramping up attacks on Republicans over their plans to change Social Security and Medicare.

GOP leaders have said the programs need to be reformed or risk going bankrupt, though they have avoided specifics about proposed changes and have said they will play hardball with government funding should they retake the majority.

• House Minority Leader Kevin McCarthy (R-Calif) has accused Democrats of twisting his comments in an interview during which he discussed both preparing for debt ceiling fights and plans to “strengthen” Social Security and Medicare. But that didn’t stop Democrats from continuing to hammer the GOP over its pledge to make changes to the crucial program, which is a particular priority for older voters.
  

• A recent MSNBC article quoted House Minority Whip Steve Scalise (R-La.) recently acknowledging the Republican Study Committee’s Fiscal Year 2023 Budget proposal would change the federal entitlement plans. However, Scalise pushed back on the characterization of the changes as “cuts,” though the proposed changes would likely mean spending less on the programs.

An AARP survey released this month found Social Security and Medicare in the top five issues for voters age 50+ in determining how they’ll cast their midterm ballot. And voters in that same age bracket were among the most motivated to vote and largely undecided.

The context: The study committee’s plans would increase the age eligibility threshold for Medicare to 67 and Social Security to 70, according to Bloomberg. Individuals can currently begin receiving Social Security retirement benefits at age 62, and Medicare insurance at age 65.

The Republican Study Committee counts among its members 158 of the 212 House Republicans, which Democrats have pointed to as showing broad support for the changes to entitlement reforms.

The Hill’s Julia Mueller digs into this here.

⏱ LEADING THE DAY

Debt ceiling showdowns are ready for comeback with GOP majority

House Republicans are looking to use a vote on raising the debt ceiling, a must-pass measure to avoid stark economic consequences and damaging credit of the United States, to get concessions on spending cuts if they win control of the chamber in the midterm elections.

• The federal government is expected to reach the $31.4 trillion debt limit, last increased in 2021, sometime in 2023.
  

• House Minority Leader Kevin McCarthy (R-Calif.), who is likely to become Speaker should the GOP take the lower chamber in November, is preparing for a battle with the Biden administration over curbing spending as a condition for a debt ceiling increase.

Republicans have long sought spending concessions in exchange for voting to raise the debt limit or tried to force Democrats to raise the limit without help from the GOP. But Democrats have criticized the GOP for these efforts, noting that they voted to raise the debt ceiling under former President Trump.

While the U.S. has never defaulted on its obligations, it is a scenario that economists say could result in economic turmoil. But the standoffs alone have triggered nervousness on Wall Street and in the business community. During a debt ceiling standoff in 2011, credit rating agency S&P downgraded its rating for the U.S. for the first time.

Exactly what spending Republicans would put on the chopping block in a future debt ceiling fight is not set in stone, but likely targets include spending key to President Biden’s domestic agenda passed in the last year.

The Hill’s Emily Brooks breaks this down here.

🗓 EVENT INVITE

The State of American Education, Wednesday, Oct. 26 starting at 10:30 a.m. ET / LIVE IN D.C. AND STREAMING NATIONALLY

While many students have returned to an in-person classroom, the effects of pandemic learning are significant. What will it take to address the scale of education loss across the country, and what type of investments and interventions are needed to make a difference? Assistant Education Secretary Roberto Rodriguez, Utah Gov. Spencer Cox, Leading Now’s Caitlin Sullivan and more join The Hill for a conversation on how students are faring in 2022 and the state of U.S. education. RSVP today.

💵 WORD IS BOND

Treasury working on bond market reforms, Yellen says

The Treasury Department is working on reforms for the bond market, which is reflecting increased uncertainty about the economic outlook, Treasury Secretary Janet Yellen said Monday.

The market for U.S. bonds, the yields of which have been rising along with interest rates and the strength of the dollar relative to other currencies, is experiencing higher transaction costs and lower liquidity levels, Yellen said, describing the bond market as the “bedrock of the global financial system.”

“We want to make sure that going forward our Treasury markets remain deep, liquid and well-functioning,” she said at an event in New York City.

The Hill’s Tobias Burns has the latest here.

💸 MORE THAN INFLATION

Left to Democrats: It’s the economy, stupid

Progressives are urging Democrats to lean more heavily into the economy in the last weeks before the midterms, arguing the party needs a course correction from its effort to motivate voters through warnings over abortion rights and a GOP beholden to former President Trump.

• The plea for a sharper focus comes as recent polling has dimmed Democratic hopes for the elections while showing voters rate inflation and economic concerns as their top priorities.
  

• While rising inflation on President Biden’s watch has been used in attack ads by Republicans, progressive activists argue Democrats can win over voters with the right economic messages.

“The closing argument has to be about what matters to the electorate,” said Joseph Geevarghese, executive director of the liberal activist network Our Revolution. “In this moment in particular, voters are looking for the candidates who will fight to raise their standards of living.”

The Hill’s Hanna Trudo explains here.

Good to Know

A federal appeals court has temporarily blocked President Biden’s student loan forgiveness program, halting the administration’s ability to dole out up to $20,000 in relief to student borrowers.

The U.S. Court of Appeals for the 8th Circuit issued a stay on the program Friday after an appeal from six Republican attorneys general representing GOP-led states.

Here’s what else we have our eye on:

• Meta investor Altimeter Capital called on the company to cut its staff and limit its investments on expanding into the virtual reality metaverse in an open letter published Monday.
  

• Tech industry groups asked the Supreme Court to hear a case on a Florida law that could help shape the future of how companies are allowed to moderate content online.
  

• Only about 5 percent of 51 million tons of U.S. plastic waste was recycled in 2021, according to a study from environmental advocacy group Greenpeace.
  
  

That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and explore more newsletters here. We’ll see you tomorrow.

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