Urgent efforts to prevent an economy-tanking national default rose and then retreated with astonishing swiftness on Thursday, as House Republicans softened their long-standing demands and the White House appeared agreeable to a compromise, only for Senate Democrats to declare it unacceptable.
"Not going to happen," declared Majority Leader Harry Reid, standing outside the White House after he and fellow Democrats met with President Barack Obama. Reid referred to a Republican plan to leave the 10-day partial government shutdown in place while raising the nation's $16.7 trillion debt limit and triggering negotiations between the GOP and Obama over spending cuts and other issues.
Heartened by any hint of progress, Wall Street chose to accentuate the positive. After days of decline, the Dow Jones industrial average soared 323 points on hopes that the divided government was taking steps to avoid a default. Reid's dismissive comments at the White House came at the end of the trading day.
And despite Reid's comments, some Republicans said they might look to him to add a provision reopening the government to any debt-limit increase the House passed.
The up-and-down day coincided with a dour warning from Treasury Secretary Jack Lew, who told lawmakers that the prospect of default had already caused interest rates to rise and that worse lay ahead.
Appearing before the Senate Finance Committee, Lew said the Treasury must pay Social Security and veterans benefits as well as salaries to active duty military troops during the second half of this month. He said failure to raise the debt limit by Oct. 17 "could put timely payment of all of these at risk."
House Speaker John Boehner led a delegation of fellow Republicans to the White House for a late-afternoon meeting with Obama as the two sides groped for a way out of the latest in a string of crises.
"I would hope the president would look at this as an opportunity and a good faith effort on our part to move halfway, halfway to what he's demanded, in order to have these conversations begin," Boehner, R-Ohio, told reporters earlier in the day.
He spoke after informing his rank and file that he intends to bring legislation to the floor as early as Friday to let the Treasury borrow freely until Nov. 22, contingent on Obama's agreement to open talks on legislation to reopen the government and discuss other pressing issues.