WASHINGTON - President Obama and House Speaker John Boehner, R-Ohio, dug in Tuesday, each declaring the other's position untenable in the ongoing fight to reopen the government and remove the threat of the first U.S. default.
The entrenchment comes as Washington entered the eighth day of a partial shutdown and with little more than one week to act to raise the $16.7 trillion debt limit by the Oct. 17 deadline.
The Dow Jones industrial average closed at its lowest level in six weeks on Tuesday.
Obama said at a White House news conference that he was "not budging" on his position that congressional Republicans raise the nation's borrowing authority without preconditions, and to allow a vote on a stopgap funding bill to reopen the government.
"Members of Congress - and the House Republicans in particular - don't get to demand ransom in exchange for doing their jobs, and two of their very basic jobs are passing a budget and making sure that America's paying its bills," Obama said.
"What the president said today was, if there is unconditional surrender by Republicans, he'll sit down and talk to us. That's not the way our government works," Boehner responded in a brief news conference.
The two parties are divided on timing for talks.
Obama and congressional Democrats are open to longer-term budget negotiations, but only after Republicans approve a stopgap funding bill and allow a required congressional vote to raise the debt limit.
The debt limit does not authorize new spending but allows the U.S. to pay for obligations Congress has already approved.
Republicans are seeking an agreement to begin a new round of budget talks before they agree to vote on either. Boehner noted that previous debt limit increases - including one in 2011 under Obama - have been coupled with deficit-reduction legislation.
The GOP-led House voted 224-197.
If Democrats agree, Republicans would consider short-term budget measures to end the shutdown and raise the debt ceiling until a longer-term agreement was secured.
Obama rejected the legislation and issued a veto threat. "I don't know that we need to set up a new committee for a process like that to move forward," Obama said, noting that the House and Senate Budget Committees have the power to negotiate a budget resolution without forming a new panel. However, Senate Republicans have rejected Democratic efforts to begin formal budget negotiations 20 times since March, in part because they have sought a standalone debate on the debt ceiling.
Senate Democrats introduced legislation Tuesday to suspend the debt ceiling until Dec. 31, 2014, past the midterm elections, and with no budgetary preconditions. The legislation will face a key procedural test vote later this week. Treasury Secretary Jack Lew will also testify in the Senate on Thursday about the economic ramifications of default.
Until then, the two sides' strategies both rest on the belief that the other party will blink first. "The long and short of it is, there is going to be a negotiation here," Boehner said. "I want that conversation to occur now."
Sen. Charles Schumer, D-N.Y., expressed confidence that Democrats will eventually get the votes to raise the debt ceiling. "I can't believe Republicans are willing to risk default," he said.
Obama said his administration is "exploring all contingencies" if Congress fails to meet the deadline. "So obviously, you know, worst-case scenario, there are things that we will try to do - but I will repeat, I don't think any option is good," he said.