US fiscal negotiations sputter as deadline nears

Updated: 2013-10-13 08:26


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Although McConnell initiated talks with Reid, the Republican has maintained a relatively low profile as he faces a tough re-election campaign back home in Kentucky.

"We had a good meeting" was all McConnell would say to questions shouted by reporters in a Senate hallway.

While some senators were hopeful now that Reid and McConnell were negotiating, no clear path to a deal was evident.

"Senator Reid and Senator McConnell are talking to each other for the first time and that's good," Republican Senator Roy Blunt said.

Even if senators craft a proposal to end the government shutdown and raise the debt ceiling, at least some Republican support will be needed to pass it in the House. That support is far from guaranteed, especially if the Senate deal does not include any new attacks on the healthcare law.

As Senate leaders tried to craft a deal, many House members headed to their home districts, having been informed there would be no votes before Monday evening.

With every passing day, according to opinion polls, Americans' patience has worn thin with Republican tactics that led to the government shutdown, enhancing prospects of a deal.

"Markets rose on hope for a deal, so markets are likely to fall as reality check alters sentiment," said David Kotok, co-founder and chief investment officer at Cumberland Advisors. Kotok said he believed there would be no deal before Thursday, adding, "This fight is a long way from over."

Companies and trade associations have been stepping up their efforts on Capitol Hill as the debt ceiling deadline approaches.

"I was optimistic yesterday morning," David French, the chief lobbyist for the National Retail Federation, told Reuters on Saturday. "I'm a little less optimistic today and so are folks I've talked to" on Capitol Hill.

Retailers are particularly concerned about going into a holiday season with debt ceiling jitters hanging over the economy.

Beyond that, French said: "They're concerned about Washington. They're concerned about the level of dysfunction. Our members do not like lurching from crisis to crisis without hope of a resolution."

Scott DeFife, top lobbyist for the National Restaurant Association, said his industry was "extraordinarily concerned with the debt limit."

For his members, he said: "Consumer confidence is critical. Any financial issue like this can really put a damper on activity."

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