On The Money — House kicks debt ceiling standoff to December

Happy Tuesday and welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. Subscribe here: digital-stage.thehill.com/newsletter-signup.

Today’s Big Deal: A temporary patch to keep the US solvent is on its way to Biden’s desk. We’ll also look at tough choices facing Democrats and how the slowing economy could pose trouble for Biden’s agenda.

But first, some Lamar Jackson appreciation.

For The Hill, I’m Sylvan Lane. Write me at slane@digital-stage.thehill.com or @SylvanLane. You can reach my colleagues on the Finance team Naomi Jagoda at njagoda@digital-stage.thehill.com or @NJagoda and Aris Folley at afolley@digital-stage.thehill.com or @ArisFolley.

Let’s get to it.

House to vote on on short-term debt ceiling patch  

The House is on track to send a bill to President Biden that would effectively raise the federal debt limit through the beginning of December, punting a fiscal standoff through December.

The lower chamber is now working through votes on a Senate-passed bill that would raise the debt ceiling by $480 billion, enough money to keep the U.S. solvent through Dec. 3. After that point, the Treasury Department would have to take extraordinary measures to avert a default, as it has been since the debt limit was reimposed Aug. 1.

The bill is on track to pass  tonight, but at least one Republican lawmaker has sought to delay the vote, so stick with TheHill.com for the latest updates. And while you’re waiting, catch up on our coverage of how we got here.

• Democrats are facing a daunting stretch as the party struggles to get beyond internal battles to win approval of President Biden’s agenda — and deal with other crises that have effectively been punted to the Christmas season.
• Congress is on the verge of narrowly averting a catastrophic debt default — and some Democrats want it to be for the last time.
• Speaker Nancy Pelosi (D-Calif.) said Tuesday she thinks a bill that would transfer the authority to raise the debt limit from Congress to the Treasury secretary “has merit.”
• Senate GOP Leader Mitch McConnell (Ky.) warned President Biden on Friday that Republicans won’t help raise the debt ceiling later this year, and stated that a recent speech by Majority Leader Charles Schumer (D-N.Y) had “poisoned the well.”

LEADING THE DAY

Pelosi: Democrats face ‘difficult’ choices in cutting cost of Biden’s agenda

Speaker Nancy Pelosi (D-Calif.) on Tuesday lamented that centrist Democrats have forced party leaders to reduce the cost of President Biden’s $3.5 trillion social benefits package, saying it will force lawmakers to make some tough choices about what provisions to eliminate in the coming weeks.

“I’m very disappointed that we’re not going with the original $3.5 trillion, which was very transformative,” Pelosi told reporters in the Capitol, forecasting “some difficult decisions because we have fewer resources.”

“But whatever we do, we’ll make decisions that will continue to be transformative,” she added. 

• Biden had initially proposed $3.5 trillion in new social spending — a massive package featuring provisions to expand health care access, child care benefits, free education programs and efforts to tackle climate change, among a host of others. 
• But the sheer size of the proposal was rejected by Senate centrists, who raised concerns about deficit spending and government overreach.

On Tuesday, however, the Speaker said she’s receiving some pushback from Democrats who would prefer to press forward with the broad array of benefits included in the larger bill, but scale back the duration of those programs to reduce the price tag. That, the Speaker said, would be their first option. The Hill’s Mike Lillis explains.

SPEED BUMPS TURN TO POTHOLES

Retreating economy creates new hurdle for Democrats in 2022

The strength of the recovery from the coronavirus recession is fading at a dangerous time for President Biden and Democrats. 

• The White House and Democratic lawmakers are facing a growing number of challenges to Biden’s pledge to “build back better” from the depths of the COVID-19 pandemic as the party braces for daunting midterm elections.
• A summer resurgence of the virus, snarled supply chains, rising prices and a slower-than-expected recovery in the labor market have prompted economic forecasters to lower their projections for growth this year and next.

While growth is expected to remain well above pre-pandemic levels through 2022, even with the downgrades driven by the COVID-19 delta variant, the dual force of slowing growth and persistently high inflation could be difficult hurdles at a dangerous stretch for Biden’s agenda.

I explain here.

GAVEL WATCH

House Budget Chair John Yarmuth to retire from Congress

Rep. John Yarmuth (D-Ky.), chairman of the House Budget Committee, announced on Tuesday that he will not be seeking reelection.

“The truth be told, I never expected to be in Congress this long. I always said I couldn’t imagine being here longer that 10 years. After every election, I was asked how long I intended to serve, and I never had an answer,” Yarmuth, who was first elected to the House in 2006, said in a video announcement on Tuesday afternoon.

“Today, I do, this term will be my last,” Yarmuth continued.

The chairman’s retirement comes as Democrats have been working quickly to pass a massive social spending package that would advance key parts of President Biden’s economic agenda.

• Yarmuth, the only Democrat in the Kentucky congressional delegation, said he will be working hard to ensure his community “is represented in Congress by the best possible Democratic man or woman” after he retires.
• Democratic committee chairmen do not have term limits, so if his party held onto its majority in the lower chamber next year, Yarmuth would have been able to remain in his post.

Aris breaks it down here.

Good to Know 

Job openings fell in August for the first time this year as surging coronavirus cases upended the labor market, according to data released Tuesday by the Labor Department.

Here’s what else have our eye on:

• Speaker Nancy Pelosi (D-Calif.) on Tuesday defended a proposal to increase the amount of information financial institutions report to the IRS about bank accounts, indicating the proposal would be a part of Democrats’ social-spending package.
• The International Monetary Fund’s (IMF) executive board has cleared its managing director, Kristalina Georgieva, of allegations that she manipulated data to placate China.

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