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The Obama administration angrily responded to Standard & Poor's decision Friday to downgrade the U.S. credit rating, with one senior official saying the agency's "analysis was way off." U.S. Treasury officials received S&P's analysis Friday afternoon and alerted the agency to an error that inflated U.S. deficits by $2 trillion, said the administration official, who was not authorized to speak for attribution. The agency acknowledged the mistake, but said it was sticking with its decision to lower the U.S. rating from a top score of AAA to AA+. "This is a facts-be-damned decision," the official said. "Their analysis was way...

President Obama laments the debt talks: "All these conversations I've had over the last three weeks -- I could have been spending time with Malia and Sasha instead."

Senate Democrats refused to solve the debt limit debate on Friday, rejecting the Cut, Cap and Balance Act of 2011 which would cut spending, restrain future outlays and require passage of a Balanced Budget Amendment to the Constitution. The Senate then adjourned for the weekend, without offering any way forward in the debt limit debate. While taxpayers have been balancing their household budgets by restraining their own spending, every Senate Democrat present voted against requiring the federal government to do the same. Voters understand Senate Democrats rejected a solution for America’s debt problem without offering any plan of their own....

Debt talks bring tensions between Democrats, Obama to surface Among Senate Democrats, there is still bitterness about the deal Vice President Biden negotiated in secret in December with Senate Minority Leader Mitch McConnell (R-Ky.) that extended all of the George W. Bush-era tax cuts, including those for the wealthy. The T-word — “triangulation” — began to circulate across Capitol Hill as lawmakers recalled how President Bill Clinton distanced himself from his party’s liberal base and from conservatives as he positioned himself for a reelection run. White House officials rejected the idea Thursday that they were abandoning their allies and said...

WASHINGTON (AP) -- President Barack Obama for the first time is allowing for the possibility that the U.S. may default on its financial obligations. At a hastily arranged White House appearance on Friday, Obama said: "If we default, then we're going to have to make adjustments."

House Speaker John Boehner, R-Ohio, on Friday said he ended negotiations with President Obama on a so-called grand bargain to achieve sizable deficit reduction in the context of raising the debt ceiling. Boehner informed all House Republicans in a letter released at 6 p.m. EDT. "A deal was never reached and was never really close," Boehner wrote. "I have decided to end discussions with the White House and begin conversations with the leaders of the Senate in an effort to find a path forward." Boehner blamed Obama's demand for higher taxes and opposition to "fundamental changes" to entitlement programs such...