Failure is an option, and one the Super Committee on debt reduction looks increasingly likely to end up with. A last-ditch meeting of lawmakers ended Monday afternoon with no smiles, no comments, but some vivid body language. Even a visit to the White House by Sen. Patty Murray, D-Wash., co-chairwoman of the panel of 12 came and went without comment. With Republican sources telling Fox News it's just a matter of timing an announcement to the market close, for some, the latest comes as no surprise.
Stock prices are tumbling around the world as investors reacted to the apparent failure of the congressional "super committee" tasked with cutting the federal budget deficit.
Two hours into the U.S. trading day, the Dow Jones industrial average was at a five-week low of 11,491.04, down 305.12 points, or 2.6%. The broader Standard & Poor's 500 index was down 2.3% on the heels of its worst week in two months.
The "super committee" is expected to announce later Monday that it failed to come up with $1.2 trillion in cuts to the deficit. Committee members are reportedly still negotiating, but if those last-minute talks prove fruitless, the lack of a deal will trigger automatic cuts to domestic programs as well as defense spending.
For the financial markets, a failure by the committee would underscore an inability of leaders in Washington to act decisively.
In Europe, a number of stock markets sank more than 3% on the U.S. political gridlock as well as a warning by Moody's that it may downgrade French government bonds.
Also depressing share prices around the world were pessimistic comments by German and Chinese officials about their economies.
| Wall Street |
Two hours into the U.S. trading day, the Dow Jones industrial average was at a five-week low of 11,491.04, down 305.12 points, or 2.6%. The broader Standard & Poor's 500 index was down 2.3% on the heels of its worst week in two months.
The "super committee" is expected to announce later Monday that it failed to come up with $1.2 trillion in cuts to the deficit. Committee members are reportedly still negotiating, but if those last-minute talks prove fruitless, the lack of a deal will trigger automatic cuts to domestic programs as well as defense spending.
For the financial markets, a failure by the committee would underscore an inability of leaders in Washington to act decisively.
In Europe, a number of stock markets sank more than 3% on the U.S. political gridlock as well as a warning by Moody's that it may downgrade French government bonds.
Also depressing share prices around the world were pessimistic comments by German and Chinese officials about their economies.
The Republican and Democratic leaders of a 12-member congressional "super committee" are set to declare defeat in a joint statement to be released after three months of talks failed to bridge deep divides over taxes and spending. After a year of bruising budget battles, it is another sign that lawmakers are too entrenched to compromise on the tax increases and benefit cuts that budget experts say are needed to set the country's finances on a stable path.For all the talk about "failure," the super-committee actually succeeded—it avoided doing more damage to the economy than has been done already. The real failure is the process that created it, and our government's misguided focus on austerity since Republicans won the elections in 2010.
