President Barack Obama postponed a Monday afternoon meeting with congressional Democratic and Republican leaders, saying he wants to give them more time to make progress in talks to end the U.S. government shutdown and prevent a debt default.
At the center of the current talks is a proposal to increase the federal government's debt limit into next year, along with a short-term measure to reopen the government and allow the start of budget negotiations.
If the debt ceiling is not raised by Thursday, the United States may not be able to pay all its bills. Obama has said this would be a catastrophe for the world economy.
Senate Majority Leader Harry sounded a positive note Monday after hopes were dashed for a deal to raise the debt ceiling and reopen the government over the weekend.
"I am very optimistic that we will reach an agreement that is reasonable in nature this week to reopen the government, pay the nation's bills, and begin long-term negotiations to put our country on sound fiscal footing," Reid said.
His negotiating partner, Republican leader Mitch McConnell, was also hopeful.
"Those discussions continue, and I share his [Reid's] optimism that we are going to get a result that will be acceptable to both sides," said McConnel.
The White House said a 3 p.m. meeting scheduled for Monday was postponed to allow Senate leaders to "continue making important progress" toward a solution on the debt limit, and reopening the government.
Earlier, Obama said he would be able to determine at the meeting whether progress is real toward ending the government shutdown and avoiding a debt default, something he said is likely to happen if Republicans are unwilling to set aside partisan concerns. "My hope is that a spirit of cooperation will move us forward in the next few hours," Obama said.
Even though it is a federal holiday in the United States, Columbus Day, the House of Representatives and Senate are in session so lawmakers can continue talks on resolving the two budget crises. Three days remain before a deadline to raise the country's debt ceiling so the government can pay all its bills.
The focus is back on the Senate and hopes are pinned on talks between Senate Majority leader Harry Reid, a Democrat, and Republican Senate Minority leader Mitch McConnell.
Democrats want to raise the debt ceiling higher, extending the amount of time before it needs to be negotiated again. They are also seeking a short-term spending bill that would allow the government to reopen. Republicans want a smaller hike in the debt ceiling along with spending at the deficit-cutting level of a 2011 budget law.
Senator Reid called for Republicans to stop using the budget crises as leverage to push through their demands.
"They are not doing us a favor by opening the government, reopening the government," he said. "They are not doing us a favor by extending the debt ceiling. That is part of our jobs. This is not a concession."
Some moderate Republicans say it was a mistake by House Republicans to shut down the government over demands that Democrats accept a measure to reform President Barack Obama's signature health care law. But they are also cautioning Senate Democrats not to overplay their hand, and try to extract too many concessions from Republicans.
Republican Senator Lindsey Graham vented his frustration Sunday on ABC News' This Week program.
"Our Democratic friends keep moving the goalpost in the Senate, thinking they are winning," he said.
On Saturday, Republican House Speaker John Boehner said his talks with President Obama on resolving the budget issues broke down, and the House now appears to be waiting on the Senate to act.
The House and the Senate need to pass a measure to extend U.S. borrowing authority beyond Thursday, or Congress would leave the United States unable to borrow money to pay its creditors. Most economic experts say this could have a serious impact on global financial markets.
Some information for this report was provided by Reuters.