As the government shutdown enters its third week, Senate leaders appear to be waiting for world financial markets to give them a jolt before they make a deal, the Washington Post reports. Harry Reid and Mitch McConnell had a conversation yesterday that Reid says left him "optimistic about the prospects for a positive conclusion." But there's no indication of what a compromise might look like, and Democrats are now pushing for a deal that would lift the sequester budget cuts, showing what the New York Times calls a "newfound aggressiveness."
- The sequester demand has Republicans frustrated. "The Democrats keep moving the goal posts," complains Sen. Susan Collins, the centrist GOP senator whose plan to resolve the crisis was rejected. Bob Corker agreed, saying of lifting the cuts, "I just can't imagine how that has any possibility of becoming law."
- The Post worries that the increasingly bitter McConnell-Reid feud could deep-six the deal. Things have gotten so bad that their colleagues recently held "the equivalent of an intervention," the paper says.
- World Bank and International Monetary Fund leaders urged the US to hurry up and forge a deal, with IMF director Christine Lagarde warning that "massive disruption the world over" looms. A foreign ministry spokesman in China called for American lawmakers to "shoulder their responsibilities," Reuters reports, and a scathing editorial in China's Xinhua state news agency called for politicians to end the "pernicious impasse"—and for everybody else to "start considering building a de-Americanized world."
- Claims that America has never defaulted on its debt are part of every debt-limit battle but the US has stiffed its creditors at least twice, the AP finds. In 1814, the government ran out of gold and silver to pay interest to bondholders in New England after setbacks in the War of 1812, and in 1979, a technical glitch that followed a long debt-limit squabble caused a delay in redeeming maturing T-bills that ended up adding about $12 billion to the cost of servicing the national debt.
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