Senate Candidates Debate: Medicare for All, Tariffs, Iran and Social Security

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0:17From the opinion pages of The Wall Street Journal, this is Potomac Watch. As Senate candidates clash in TV debates, the public starts to get a real midterm argument about Medicare for all, as Republicans and Democrats also seek to draw contrasts on tariffs, Iran, and how to save Social Security. Welcome, I'm Kyle Peterson with The Wall Street Journal. We're joined today by my colleagues on the WSJ's opinion pages, columnists Kim Strassel and Alicia Finley. With less than a month to go before November 3rd, debate season has begun. Today, let's focus on four big debates this week in three states.

0:57A toss-up Senate races in Michigan, Iowa, and Maine, where Susan Collins and Troy Jackson tangled on Tuesday, and then again on Thursday. Total, that's four hours of TV and all, so we can't cover everything. But, Kim, one emerging theme is the democratic promise of Medicare for All. First, let's listen to Susan Collins taking after this idea. What we don't need is for big government to take over health care, to abolish private insurance that people such as the workers at Bath Iron Works are happy with and that have led to avoidable deaths, 16 ,000 in England alone because they couldn't get care.

1:43And here's for challenger Democrat Troy Jackson explaining how he intends to pay for it. Medicare industry is trying to rook you out of everything that you have. That is what Senator Collins wants to keep going. Big health insurance, big pharma, so they can make all the money. It's about greed. We can do Medicare for all when we start prioritizing where we're spending our money. Not in the forever wars, not in ICE, not in all these different things. that were not big tax cuts for the wealthiest people, for the Elon Musk that make sure that they dump money back into the state to support Senator Collins.

2:16That is what's happening in our government. We're wasting our money. Kim, it seems to me that Troy Jackson doesn't seem to have thought very hard about the analyses showing the true cost of Medicare for all trillions of dollars a year. I mean, he reiterated that he wants to abolish ICE, But that's like it starts with a B. The ICE budget starts with a B. It's billions. And so it's a drop in the bucket. This is why I love debates, because we can go for months and months of lead ups to elections and people just sloganize. And then finally, when you get a debate, you get an opportunity for folks to begin talking about how this is supposed to work and drilling in.

2:56And this is insanity. I think it's a real liability for Democrats. You're seeing that in a couple of different ways. Once you have to move beyond just saying, yay, Medicare for all. And you have to start explaining how all this works and what the tradeoffs are and that the sacrifices, that's when things begin to break down. I actually did do those calculations, Kyle, because I was curious. So Troy Jackson said, we'll just shut down ICE and pay for Medicare for All. Okay. ICE's standard discretionary budget annually is about$10 billion. The analysis of Bernie Sanders's Medicare for All bill that he has, and it'll come in at$33 trillion.

3:39So I actually did that calculation just for fun. that 10 billion equals 0.03 % of the cost of Medicare for All. So I think Troy Jackson has some more math he needs to be doing there. And Susan Collins also made a really good point about when you talk about Medicare for All, you want to talk about the details, you are talking about abolishing private insurance. And that is something that more than 60 % of the country still utilize. In the state of Maine, nearly 50 % of all the people there. And for as much as people sometimes complain about their insurers, they like their private health care and they know that there's a significant difference between that and the socialized care that happens in places like England.

4:21The idea of abolishing private insurance, I think, is a huge vulnerability for these candidates who have endorsed Medicare for all. And in Michigan, interestingly, Abdul El Syed, the Democratic nominee for Senate there, seems to have figured out his way of answering that political vulnerability is simply to deny it, to pretend that Medicare for all means something other than the words Medicare for all. Let's start with a piece of that debate. First, here is Mike Rogers, the Republican Senate nominee. He just does not want to explain what his proposals are. That's why he does this. You learn that in Oxford, I guess, how to talk pretty.

4:58But I will tell you what, it's dangerous. They're going to take away your personal health care, And the new cost is$20 ,000 in new taxes per family. Oh, and by the way, you have to answer to the government. Oh, and by the way, he supports the death panels that Canada implemented. Do you want the government making those decisions at a more expensive cost and less access? And here was what Abdul El-Sayed said pitching this Medicare for All idea. Democratic State Representative Karen Witsett said she is supporting Republican Mike Rogers in this race because of your Medicare for All position, Dr. El-Sayed.

5:34Her husband has employer-provided health insurance. You will lose your health insurance if the other candidate gets in office. There's no ifs, ands, or buts about it. That is what Medicare for All means. Dr. El-Sayed, you have said additional private coverage would become redundant. In your plan, could families keep their private health care? Yes or no? You have 60 seconds. Yes, absolutely. Absolutely, Rick. If families want to keep their private health insurance, that's fine by me. But for too many people, if you lose a job, excuse me. Alicia, that's a pretty deceptive answer to my mind. The bills that have been put forward in Congress, Bernie Sanders sponsored one, has sponsored it for years, would bar duplicative coverage.

6:19So employers or private insurance plans would be it would be illegal for them to cover the same kind of services as the Medicare for all program offered by the federal government. What I take El-Sayed to be saying here, and his campaign website seems to suggest that, is he just wants to delete that one line from the Medicare for All bill. But if Medicare for All is automatic enrollment for every American, I don't see what the difference is because employers are simply not going to pay for that kind of coverage if the government is already footing the bill. Right. I mean, he's been a little slippery and other Democrats have been, too, on what Medicare for All stands for.

6:59And if you actually look at the polls, most people think just Medicare for All means universal coverage. The government ensures and guarantees coverage. And that is actually kind of what Obamacare did by requiring insurers to cover pre-existing conditions and banning them from essentially doing all kinds of risk adjustments. The problem gets down into the details. And I think you're right that essentially if you provide a free government health plan, what is the incentive for the employers or any private insurer outside of the employer market to actually provide insurance? because you're going to have to charge premiums.

7:36You're going to have to charge co-pays, deductibles. There is a price for that. And it is basically nearly impossible to run an insurance plan if you have a large group of people migrating toward a government-run plan. Now, I think how they plan to get to this kind of single-payer plan is that I don't believe they're actually going to ban private insurance, pass a law and ban private insurance. That would be probably too controversial. What they're doing is essentially on an installment plan. What they do is essentially regulate private insurance, make it so costly, which, by the way, the Obamacare did.

8:13Premiums for employer plans have increased at twice the rate of inflation since Obamacare passed. And a lot of that has to do with regulations. A lot of that also has to do just with how Obamacare really reduced competition in provider markets, resulting in hospitals having monopolies in many local markets, which has allowed them to increase prices on the insurance plans. And the result is that hospitals charge about two to three times as much for private plans than they do for the government. So the employers actually aren't paying more largely because there's no competition. And because there's no competition, they have a lot of pricing power.

8:53There's also no competition for to provide better quality of care. And I think Democrats are trying to appeal to this frustration with a lot of people that have with the health care system for understandable reasons, because costs have been increasing at a faster pace than inflation. and deductibles are increasing. And if you go to ERs and there's so much bureaucracy, hospitals still use fax machines. Private authorization is left legs to rail against that. But the big reason why it's so dysfunctional is because just the doctors and the offices and the hospitals have not invested in the technology to ensure that this prior authorization by insurers actually happens in a day or two, which it could.

9:36So a lot of the dysfunctions that people are so upset about in private care are a result of these government regulations. So if you looked at the Senate finance plan that was put out a couple months ago about proposals, what they want to do in healthcare, Medicare for all government run healthcare, single payer, that really didn't factor into it. What they were really talking about is let's increase regulations on private plans and set up this kind of public option. And then there are different proposals and ways to structure that. But the result effectively would be to, again, increase premiums on private plans and steer more people to government run health care, whether that be a Medicaid or some kind of public option.

10:20I think that's what you're likely to see. And you're likely to see increased frustration, which just propels their whole campaign for Medicare for all is like their own regulations and their own solutions are what is causing premiums and prices to increase. Hang tight. We'll be right back in a moment.

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11:58Welcome back. Let's stick with Michigan for a moment. The Iran war and President Trump's conduct of it a significant point of debate in all three of these states and in all three of these races. One remarkable moment from Michigan. Let's listen to Abdul El-Sayed here. Who do you think is a bigger threat to the United States, Israel or Iran? You have 60 seconds. And again, Rick, I'm just going to say that that's a ridiculous hypothetical because here's what's happening right now. Our ostensible ally in Israel has lobbied us to go to war with Iran. We have watched as Iran has responded by bombing all kinds of countries in the Middle East and then choking off the world's energy supply.

12:39So this is a situation in which I don't think we should be apart. I don't want to be pushed into war by Israel and I don't want to be in a war with Iran. I want our money spent here to buy schools and health care and child care here. I don't understand why that is so inconceivable. Kim, what do you make of that answer? I don't even know if remarkable is the word, Kyle. The moral equivalence in that question, I mean, he tried to duck it essentially to a certain degree. But the idea that he could not when asked to simply say Israel or Iran in response to that question as to which is a bigger problem.

13:16I mean, on the one hand, you have the largest state sponsor of terrorism in the globe that has spent hundreds of millions of dollars to organizations like Hezbollah and Hamas who exist to engage in things like the October 7th event, essentially who exist to kill people and to overthrow democracies to sow as much problem as they can versus an ally that is a democracy. and one of the only outposts of kind of thriving economy in the Middle East is just it's ludicrous. But, you know, he did it as well a little bit later when he was asked if he would vote to send defensive weapons to Israel if it were attacked by Iran.

14:00So we're not even talking about offensive weapons, but defensive weapons. He sidestepped that questions and once again went into a long monologue about how he wants American tax dollars to be spent on schools and health care, etc. I mean, think about what he is saying there, that he would not even allow American weapons to go to a country that is simply trying to defend itself. Forget the question of us and our Iran involvement, but he would also, in sidestepping that question, he made it pretty clear that he would also make sure that we did not even provide Israel the opportunity to buy some hardware to try to keep its citizens safe.

14:39And, you know, this is the kind of mindless left wing conspiracy theories that get you to the point that he made there as well, that somehow Israel pushed us into our war with Iran. No, what pushed us into our war with Iran was Iran's unrelenting ambitions to not only get a nuclear weapon to hold the world hostage, but to build up its ballistic missile arsenal and make itself one of the bigger threats on the planet. One place Republicans on the defense in all three of these states is tariffs. tariffs. Alicia, remarkably, Mike Rogers running ads this week calling for a trade truce with Canada, explaining that Canada is not our enemy.

15:18What do you think is the effect that these tariffs, particularly in Canada, is having in all three of these races and the ways that Republicans are trying to respond to it? Well, I think the tariffs, if you look at the polls, they're overwhelmingly unpopular, particularly in states that do a lot of trade with Canada, and that being Maine, Michigan, even Iowa. Michigan, for instance, that is about$40 billion worth of Canadian imports. About half of that is vehicles and components. And Michigan's auto industry is pretty entwined and integrated with the Canadian auto supply chains. And so when you impose these 50 % taxes, as President Trump did in his latest, or in his escalation this summer.

16:05I think consumers and small businesses understand, and again, small businesses are paying probably the brunt of this because larger companies can to some extent absorb some of these costs. And at least the big automakers have lobbied for some kind of emollient. And by which I mean, there are kind of some kinds of rebates and things that mitigate the hit. Not to say that they're not still paying some of the costs, but it's not as bad as it could be. But the small businesses are really paying the brunt of these Paris or border taxes, as well as consumers. And I think people understand that. And then the other issue is that Trump's tariffs have resulted in retaliation by Canada, which has hurt many of these, again, small businesses that export to Canada.

16:51And so if you look at the polls, as I was referencing earlier, about two-thirds of independent voters, and it doesn't really matter by state. It's basically almost in every state about two-thirds of independent voters oppose the tariffs. I think there's probably more support for tariffs on China, but there's overwhelming opposition to tariffs on a country like Canada, which people don't think see as really, you know, abusing its or committing unfair labor practices or unfair trade practices. And so I think the reason why Mike Rogers is now coming out and saying, let's stop this war is because he's seen the polls.

17:25He's seen that they're very unpopular. El-Sayed, his opponent, is trying to make hay of it and pointing to the costs. And the Michigan Smart Trade Alliance, which is a business outfit out there based in Michigan, estimates that the cost is around$6 ,800 per household since Trump's tariffs took effect. Now, again, people don't see this kind of line item on the bills, their bills, when they check out a grocery store or the Home Depot. But they know intuitively that they're still paying the cost. And so I think Rogers is now trying to finally get out in front of this issue. There was also an interesting poll that I saw the other day in CBS poll that found the majority of Republican voters at this point actually want Republican candidates to agree with President Trump on some things, but not all things.

18:15And so I think Rogers and some other Republican candidates are trying to create some distance from the president. And this is one issue I think they are now trying to get comfortable with doing so. Hang tight. We'll be right back after one more break. Why can't we get AI to production? Our competitors are all ready. How do we keep data secure? When do we actually see ROI? All this talk about AI, but talk doesn't transform businesses. AWS AI cuts through the noise. making AI easier to securely deploy and scale. With ready-to-use agents and the broadest set of AI tools and services, you can build, buy, or partner your way.

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19:13The Wall Street Journal, this is Potomac Watch. Welcome back. Let's take up one more subject, that is social security. The latest estimates from the trustees are that the retirement trust fund will run dry, become insolvent in 2032, at which point there is going to be a 22 % automatic cut to benefits going out to seniors. This is providing points of contrast in a lot of these races. Let's listen first to in Iowa's open Senate race, Republican Ashley Hinson and then Democrat Josh Turek. Do both of you think that raising the retirement age is, I guess, decreasing the benefits for potential beneficiaries, Ashley Hinson?

19:56If you're 20 years old, it's a very different conversation than if you're at retirement age, is what I would say as I think about that. I'm not in favor of raising the retirement age. Kim, other than the Iowa nice tone of that Senate debate, I think this is a revealing clip because part of what I think often happens is there starts to be some talk about how to reform, how to save Social Security for future generations. But Democrats often treat any sort of change to the program, even if it's for people who are 20 years old. We're going to raise the retirement age maybe for people who are 20 years old now, 45 years from now.

20:31That often gets attacked as a cut in benefit. You see two things going on with Democrats here, and both of them are worth noticing. One is that so many candidates out there are now doing a rerun. We've seen it in every election in the last couple of decades of the reprise of Republicans want to throw grandma off the cliff, just take her wheelchair and give it a shove. And they're running on this, suggesting, you know, trying to scare seniors out of voting for Republicans. And one of their issues this year is Social Security, saying, you know, my Republican opponent will raise your retirement age or they'll cut your benefits or they'll want to take Social Security away from you entirely.

21:14Here's the second thing going on. When you listen to those Democrats, they have absolutely zero plan for what they're going to do about this coming freight train that is about to go off the tracks. As you just mentioned, we are six years away from insolvency, six years away from dramatic cuts and benefits that are going to make people lose their minds. The best you will ever get from a Democratic candidate is a very truly terrible policy or an idea for how you fix all this. the most popular one at the moment that you are hearing from people like Troy Jackson in Maine, is let's get rid of the cap on Social Security earnings in terms of how much of your wages are taxed each year and put into Social Security.

21:55This is a terrible idea because whatever you think of Social Security, in my own view, is it was terribly designed from the beginning, since it's based on the premise of the oldest generation of workers being supported by a constant influx of younger workers, which is not really panning out so well. But whatever you thought of it, at least since its inception, it has always operated as a form of social insurance rather than some left-wing wealth redistribution mechanism. You get rid of the cap on earnings, that is what you turn it into. It would be economically hugely destructive as a form of a tax hike.

22:35It would probably reduce work incentives. It would divert capital away for more productive private investments. And like I said, turn this into the newest sort of wealth redistribution scheme. So that's the best they've got. But I think that's something worth bearing in mind as you see this flood of commercials and complaints and debates. Somehow Republicans are out to get the old folks. Democrats are the ones that are standing by and waiting for bad things to happen to our retiring generation with no plan for how to deal with it. That idea of eliminating the cap or raising the cap on Social Security taxes, though, not only always on the left or Democratic side of the aisle.

23:16Let's listen, go back to Maine here at the end to first Troy Jackson. Well, I think it's pretty clear. It's been talked about for a long time. We need to remove the cap so that wealthy people pay in at the same rate as working class people. So right now, if you're making$180 ,000, you pay$10 ,000 in Social Security. If you're making$5 million, you pay$10 ,000 in Social Security. I don't believe that's fair. And I also believe that we should, once we get rid of the cap so that we can make it solvent, we could raise benefits for people that are really struggling right now in this economy that Donald Trump and Susan Collins have created.

23:55I mean, people that only get$1 ,000 a month when they're paying$1 ,600 or$1 ,700 for a tank of oil, I mean, they can't keep up. And that's why making sure that billionaires pay at the same rate as people that are just squeaking by, I think is important. And here with the last word is Republican incumbent Susan Collins. But here is something where I actually agree with Troy. I don't think someone who makes$40 million a year as a movie star should pay the same rate of Social Security taxes as someone who's earning$184 ,000 a year. We simply are going to have to adjust the cap. Alicia, we'll give you the actual last word, but I tend to agree with Kim here.

24:45I mean, you often hear about Social Security as an earned benefit. you pay into the program and then you are supposed to be saving in advance and then the government will give you benefits that are in some way commensurate with the money that you put into the program. And if you take that cap off, you are sort of breaking that deal. I mean, I don't think that that is actually how Social Security operates anyway. I think that that is an incorrect assumption because it's pay as you go. It is not as if you have some account and you're putting your money in for later. That is not how Social Security runs.

25:17But it is a very powerful idea out in the public, I think, that this is an earned benefit. And if you remove the cap, you are kind of breaking that promise. Right. So the way Social Security works is it's actually progressive in the sense that people, lower earners, get disproportionately more back in benefits than they contribute relative to higher earners. So higher earners who actually contribute much more, notwithstanding the cap, actually get much less back relative to their wages and their contributions. So it's already pretty progressive. Now, what they're talking about is essentially, who knows if they're going to lift the cap or just remove it altogether, but that would essentially be a 6.2 % increase in the top marginal rate, which would put you up right now, it's 37 % is the top marginal rate.

26:07So that would be essentially a 43.2%. And then you add on state taxes. In some states, you're looking at 60 percent marginal tax rate. And that's without, you know, other Democratic proposals to increase the top income tax rate. And what you would see as a result, no doubt, is, well, just people reducing their work. And this is a disincentive to earn more. And you see that with the higher tax rates. You also see more, you know, tax sheltering through various means and unproductive investments. So I think you wouldn't necessarily see a result in increasing revenue merely by increasing the cap. Can I also just throw one last thing in here, Kyle, just because what Troy Jackson said there was so deceptive.

26:55The reality is people are charged the same tax rate for their earnings. And then the thing is, whether you make$180 ,000 and pay 10 grand into Social Security or whether you make$5 million and pay 10 grand into Social Security, everyone is capped. There is a maximum cap on how much can come out each month. So everyone's subject to that same limit and everyone's subject to a cap. So it's not like if you paid, if you're$5 million, you're getting more in Social Security benefits than anyone else. Everyone's stuck at that cap. Thank you, Kim and Alicia. Thank you all for listening. You can email us at pwpodcast at wsj.com.

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