President Barack Obama bluntly told Republican congressional leaders Wednesday they must compromise quickly if the government is to avoid an unprecedented default, adding, "Don't call my bluff" by passing a short-term debt limit increase he has threatened to veto.
The presidential warning, directed at House Majority Leader Eric Cantor, R-Va., marked an acrimonious end to a two-hour negotiating session at the White House that produced no evident progress toward a compromise.
Another round of talks is set for Thursday.
But with a threatened default less than three weeks away, Moody's Investors Service announced it was reviewing the U.S. bond rating for a possible downgrade, and the Treasury said the annual deficit was on a pace to exceed $1 trillion for the third year in a row.
With the negotiations at a seeming standstill, Republicans drew a warning of a different sort, from an unlikely source - the party's Senate leader, Sen. Mitch McConnell of Kentucky.
In an interview with radio talk-show host Laura Ingraham, McConnell warned fellow conservatives that failure to raise the debt limit would probably ensure Obama's re-election in 2012.