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GOP Wants to Risk Economic Chaos With Debt Ceiling to Cut Social Security

  • President Joe Biden said that the GOP wants to hold the economy hostage over Social Security and Medicare.
  • If they retake the House, the GOP wants to use debt ceiling negotiations to enact spending cuts.
  • But Biden has ruled out repealing the debt ceiling, despite Democratic pushes.

As the potential of a Republican majority in at least one of the chambers of Congress looms, President Joe Biden is warning about the deep cuts that the GOP might enact when the next debt ceiling debate plays out.

“We — the Democrats — are the ones that are fiscally responsible. Let’s get that straight,” Biden said at DNC headquarters. He said that Republicans are “fiscally reckless” as they push tax cuts for the wealthy — likely referring to Republicans’ stated desire to preserve Trump-era tax cuts.

If Republicans take back the House, they’re also preparing to use impending debt ceiling negotiations, in which Congress is legally required to periodically increase the amount of money the federal government can borrow in order to pay its bills, to force spending cuts, potentially including Social Security and Medicare. Those potential cuts would come as Social Security’s coffers are already strained, especially as monthly checks increase to adjust for inflation.

Biden emphasized the possible threats to the major federal retirement programs. “Democrats are going to protect Social Security and Medicare. Republicans have been very clear — they’ve stated boldly that they want to cut Social Security and Medicare, to the point that they’ll shut down the government, they say, and send the nation into a default, which rises prices for everyone if we do not cut Social Security and Medicare,” Biden said.

“I ain’t going to do it,” the president dramatically whispered.

“I think the president has put it exceedingly well,” Aaron Fritschner, the communications director for Rep. Don Beyer, a Democrat from Virginia, told Insider.

Biden has said that he opposes repealing the debt ceiling outright, despite calls to do so from some Democrats: “That would be irresponsible.” Sen. Bernie Sanders, a key progressive, seems to agree with him, suggesting that there’s not an appetite from the left to eliminate the debt limit anytime soon.

Last year, Democrats scrambled to raise the debt ceiling, inching dangerously close to a default which could be triggered if the government isn’t allowed to borrow money to meet its obligations. The $2.5 trillion extension came after Republicans allowed Democrats to lift the ceiling with a simple majority, rather than through the 60 votes required to bypass a filibuster.

But if Republicans retake the House in the midterms, that likely won’t happen again. Instead, they’re ready to use the debt ceiling — which could be hit anywhere from early 2023 to next summer — as a bargaining chip, with programs like Social Security and Medicare potentially on the chopping block. A default risks recession, markets crashing, and the dollar losing value. Abolishing the limit was floated as one option to head off last year’s crisis; another was to mint a $1 trillion platinum coin to pay off the bills

Biden’s remarks come as Democrats double down on economic messaging ahead of tight-looking midterms. High prices and the economy top voters’ worries as they head to the ballot box.

“In order to cut Social Security and Medicare, they’re threatening to default on the federal debt,” Biden said of the GOP. “There’s nothing — nothing — that would create more chaos, more inflation, and more damage to the American economy than this.”

The president added: “Republicans are determined to hold the economy hostage. Either give in to their demands on Social Security and Medicare, which millions of Americans rely on and earned and paid for, or Republicans are going to crash the economy.”

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