Harry Reid and John Boehner each made progress in their quest for votes yesterday—but that actually drove them further away from a compromise. House Republicans and Senate Democrats “seemed to operate in alternate realities,” the New York Times observes, with each sure the other would eventually cave and accept their bill. If there’s hope for a compromise, it might come from Joe Biden and Mitch McConnell, who according to Politico are in talks on how to end the showdown.
To build support for his bill, Boehner tweaked it to raise its disappointing CBO score to $917 billion in savings—mostly through technical changes that took CBO accounting practices into account. But 53 Senators, including two independents, signed a letter saying they wouldn’t pass the House bill. The standoff spooked investors and sent stocks plummeting—the Dow fell 199 points, with the Nasdaq and S&P down 75 and 27, respectively, according to MarketWatch. The Treasury is preparing for the worst, too; by the end of the week, it says it will lay out who will and won’t get paid if a deal isn’t reached. (Read more debt ceiling stories.)