UPDATE: Senate leaders negotiating deal to end shutdown after House efforts fail

UPDATE: This story was edited at 12:13 a.m. to reflect the Senate’s new efforts to reach a deal.

WASHINGTON — Time growing desperately short, Senate leaders took command of efforts to avert a Treasury default and end the partial government shutdown Tuesday night after a last big attempt by House Republicans abruptly collapsed.

Aides to both Senate Majority Leader Harry Reid and the Republican leader, Mitch McConnell, expressed revived optimism about chances for a swift agreement — by Wednesday at the latest — that could pass both houses. Their efforts toward a bipartisan resolution had seemed likely to bear fruit a day earlier before House conservative were given a last-minute chance for their version.

As hours ticked down toward Thursday’s Treasury deadline, the likeliest compromise included renewed authority for the Treasury to borrow through early February and the government to reopen at least until mid-January.

As the day of secret meetings and frenzied maneuvering unfolded in all corners of the Capitol, Sen. Barbara Mikulski, D-Md., stood on the Senate floor at midafternoon and declared, “We are 33 hours away from becoming a deadbeat nation, not paying its bills to its own people and other creditors.”

In New York, the Fitch rating agency warned that it was reviewing the government’s AAA credit rating for a possible downgrade, though no action was near. Fitch, one of the three leading U.S. credit-ratings agencies, said “the political brinkmanship and reduced financing flexibility could increase the risk of a U.S. default.”

On Wall Street, the Dow Jones industrial average fell 133 points after rising a day earlier when optimism spread that a deal might be at hand.

Under the revised bill prepared by House Republicans, the Treasury would be permitted to borrow normally until Feb. 7 and the government reopened with sufficient funds to carry it to Dec. 15.

Additionally, members of Congress, the president, vice president and thousands of aides would no longer be eligible to receive employer health care contributions from the government that employs them.

Before the bill seemed to lose steam later in the day, Michael Steel, a spokesman for Speaker John Boehner said in a statement, “The House will vote tonight to reopen the government and avoid default.”

He said the legislation would “end Obamacare subsidies for elected officials and staff in Washington, D.C., and pressure Senate Democrats to accept more sensible” time frames for reopening the government and renewing Treasury’s borrowing authority.

Gone from the measure was a pair of provisions that had drawn objections, one a plan to delay a medical device tax created under the Affordable Care Act. The other would have imposed tougher income verification standards on individuals and families seeking subsidies for care under the law.

Democrats had viewed both as concessions to Republicans, and deemed their inclusion as a violation of Obama’s vow not to pay a “ransom” to the GOP for passing essential funding and borrowing measures.

Even with the changes, it was unclear whether Boehner and the GOP leadership had the votes to pass their measure.

Heritage Action, a group with close tea party ties, announced it would oppose the measure because “it will do absolutely nothing to help Americans who are negatively impacted by Obamacare.” It said it would include the vote in its determinations next year on which candidates to support in the midterm elections.

The day’s events prompted an outbreak of partisan rhetoric, mixed with urgent warnings that both the U.S. and global economies could suffer severe damage quickly unless Congress acted by Thursday.

Even something of an appeal for heavenly aid was thrown in, as Rep. Steve Southerland of Florida led House Republicans in a rendition of “Amazing Grace” at the beginning of a rank-and-file meeting called to discuss a way out of the impasse.

Speaking with reporters, Boehner said, “I have made clear for months and months that the idea of default is wrong and we shouldn’t get anywhere close to it.”

But the first measure the leadership produced evidently came up short on votes, and the White House trashed it as an attempt to “appease a small group of tea party Republicans who forced the government shutdown in the first place. “

Democrats jumped on Boehner and the plan he produced.

In unusually personal remarks, Senate Majority Leader Harry Reid said the Ohio Republican had “once again tried to preserve his role at the expense of the country.”

That was a reference to a rebellious rank and file in the House, who routinely seek to push Boehner and the rest of the leadership to the right. A group met Monday night with Texas Sen. Ted Cruz, who last summer played a public role in a campaign to demand defunding of Obamacare as the price for preventing a partial government shutdown.

The Democratic attacks were too much for some Republicans who have been among those most vocal in calling for a bipartisan solution to the impasse.

“It’s piling on and it’s not right,” Sen. John McCain, R-Ariz., said of the response from the Democrats. “To categorically reject what the House and the speaker are doing — and I think he’s pretty courageous in what he’s doing — in my view is not serving the American people.”

David Espo, Associated Press