The Biden administration is in early, quiet discussions with key Senate offices about raising the debt ceiling in the lame-duck session of Congress, Axios' Hans Nichols has learned.

Why it matters: The preliminary conversations reveal two political near-certainties gripping Washington:

• Republicans are likely to win control of the House.
• A potential Speaker Kevin McCarthy would use the debt ceiling to extract painful spending cuts from the White House — even if it threatens to crash the economy.

State of play: Democrats, as well as Wall Street moderates, are alarmed by McCarthy’s rhetoric and are strategizing how they can deprive him of the blunt battle axe — a default on the nation's debt — that he appears willing to brandish.

• Senate Majority Leader Chuck Schumer (D-N.Y.) will likely need 60 votes in the Senate to raise the debt limit above its current $31.4 trillion, requiring help from at least 10 of the 14 GOP senators who supported the last debt ceiling increase in December 2021.
• One of those Republican senators, Susan Collins (R-Maine), is supportive of raising the debt limit in the lame duck this year, according to a person familiar with her thinking.
• There's also some existing appetite among Senate Democrats to handle the debt ceiling in the lame duck as one of their last acts before a potential two years in the minority.

For the record: The White House disputes that any such conversation with congressional leaders have taken place.

• "The President looks forward to working with a Democratic House and Senate,” White House spokesman Andrew Bates said in a statement.

The big picture: President Biden has ramped up his warnings in recent days about the consequences of failing to raise the debt limit.

• "There’s nothing — nothing — that will create more chaos, more inflation, more damage to the American economy than this," Biden said at a DNC event today.
• On Friday, Biden ruled out supporting legislation that would outright eliminate the debt ceiling.
• But he's moving closer to the position that President Obama ultimately took with House Republicans on the debt ceiling: refusing to negotiate.
• "Let me be really clear: I will not yield," Biden said Friday at the White House. "I will not cut Medicare, no matter how hard they work at it."

The intrigue: Some Democrats are floating the idea of practically repealing the debt ceiling by raising it beyond anyone’s expectations.

• Jason Furman, a former chair of the Council of Economic Advisers for President Obama and a veteran of the 2011 and 2013 debt showdowns, called on Twitter for Democrats to raise it by $100 quintillion (which would be 20 zeros.)

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A spending arms race has broken out in New York's 17th Congressional District in the hours since Cook Political Report made the seismic call to shift its rating from "lean Democrat" to "toss-up" — declaring House Democrats' campaign chair Rep. Sean Patrick Maloney is in "deep danger."

• The DCCC, which Maloney runs, went up with a $605,000 ad buy today attacking his Republican opponent Mike Lawler as a "MAGA extremist."
• The NRCC quickly countered by pouring another $867,000 into the district on top of the roughly $1 million it has already spent. Republicans are spending over $6 million in total to defeat Maloney.

Why it matters: "We smell blood in the water," a national GOP source told Axios' Josh Kraushaar. A sitting House campaign committee chair hasn't lost re-election since 1992 — and hasn't lost a general election since 1980.

One week after House Minority Leader Kevin McCarthy (R-Calif.) set off alarms with his suggestion that a GOP-controlled House will not write "blank checks" to Ukraine, progressive Democrats have seeded a new controversy in Kyiv:

• In a letter to Biden, 30 House Democrats called for the U.S. to engage directly with Russia in a renewed diplomatic push for a peace settlement — citing the growing risk of nuclear escalation.

Why it matters: It's the first time prominent members of Biden's own party — including Reps. Pramila Jayapal (D-Wash.), Alexandria Ocasio-Cortez (D-N.Y.) and Jamie Raskin (D-Md.) — have urged the president to change his approach to Ukraine.

• One proposal in particular — suggesting a framework that involves "incentives to end hostilities, including some form of sanctions relief" in exchange for security guarantees — has already drawn backlash.

Between the lines: Unlike many of the MAGA-aligned Republicans who oppose aid to Ukraine, the letter is careful to express complete solidarity with the Ukrainian people and blame no one but Russian President Vladimir Putin for the war's devastating impacts.

• That sentiment was reinforced in a new statement by Jayapal responding to the swift backlash, in which she stressed that "nothing in the letter advocates for a change" in support for Ukraine.

Read the letter.

The Nevada Independent's Jon Ralston, renowned nationally for his Nevada election analysis, broke down on The Lobby Shop podcast the key factor that will decide Sen. Catherine Cortez Masto's nail-biter against Republican Adam Laxalt:

"The Hispanic vote here in Nevada is somewhere between 20% and 15% of the electorate, depending on what the election cycle is. ... I have seen no polling that shows Catherine Cortez Masto with the kind of lead she needs among the Hispanic vote. And their only hope is what Democrats have said to me for years here — that a large percentage of the Hispanic vote makes up its mind late, and are driven to the polls by the Democratic turnout machine. But if she doesn't get well over 60% of the Hispanic vote, if Laxalt can get 40% or more of the Hispanic vote, I think that's devastating for her."

Ralston's bottom line: "If the first Latina ever elected to the U.S. Senate cannot crush Adam Laxalt in the Hispanic vote, she is going to lose, and that is probably going to be a signal to the rest of the country about what's going on."

At a reception celebrating Diwali, the Hindu festival of lights, President Biden drew a burst of applause with his recognition of incoming Prime Minister Rishi Sunak as the U.K.'s first-ever leader of South Asian descent:

• "It’s pretty astounding, a groundbreaking milestone and it matters, it matters," Biden said as he stood feet from his own history-making Vice President Kamala Harris.