Video: House Speaker John Boehner said Tuesday there were "a lot of opinions about what direction to go" on government shutdown negotiations after a meeting with House Republicans.
Later Tuesday night, Senate leaders Harry Reid and Mitch McConnell moved to pick up the pieces of the shattered House effort, with aides to both senators expressing optimism a deal could be soon at hand.
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“Senator Reid and Senator McConnell have re-engaged in negotiations and are optimistic that an agreement is within reach,” said Adam Jentleson, spokesman for Reid (D-Nev.).
“Given tonight’s events, the leaders have decided to work toward a solution that would reopen the government and prevent default. They are optimistic an agreement can be reached,” said Don Stewart, spokesman to McConnell (R-Ky.).
It was already far from clear if the House proposal could attract enough support in the Democratic-controlled Senate to end Washington’s political crisis. The plan contains several provisions that Democrats have strongly opposed.
The influential conservative group Heritage Action also opposed the House proposal soon after it was announced, and conservatives close to the House leadership expressed alarm that they had shut down the government and would get nothing for it except a punitive measure restricting their own staff’s healthcare, according to senior House Republican aides.
“I’ve got one vote and I’m a no,” Rep. Thomas Massie (R-Ky.) said as he left a meeting with House Speaker John Boehner’s (R-Ohio) leadership team.
The stunning turnaround could represent yet another rebuke to Boehner, whose previous efforts at compromise have been thwarted by his party’s right flank. And with the U.S. Treasury set to exhaust its ability to borrow money on Thursday, Fitch Ratings, a credit rating agency, announced Tuesday that it was accelerating its timetable for a potential U.S. credit rating downgrade, among the first concrete effects of the standoff. If Fitch follows through, it would become the second credit rating firm to downgrade U.S. government debt, potentially triggering ripple effects across a range of financial markets.
“Political brinkmanship and reduced financing flexibility could increase the risk of a U.S. default,” Fitch said late Tuesday. “The U.S. risks being forced to incur widespread delays of payments to suppliers and employees, as well as Social Security payments to citizens — all of which would damage the perception of U.S. sovereign creditworthiness and the economy.”
Fitch’s announcment followed a day of declining optimism about efforts to resolve the crisis, , as Democrats and Republicans began attacking each other again and the White House said negotiators remained “far from a deal.’’
Just a day earlier, Senate leaders had been closing in a deal to end the two-week-old government shutdown, extend borrowing authority until Feb. 7 and fund federal agencies for three months. But the bipartisan Senate talks were put on hold Tuesday as negotiators awaited a plan from the Republican-led House.
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