Just before noon the Dow Jones industrial average is down 43 points to 13,152. The Standard & Poor's 500 index has given up four points to 1,426. The Nasdaq composite is trading 10 points lower at 3,011.
Sen. Joe Lieberman said that it is now "more likely we'll go over the cliff than not," following the failure of a plan by House Speaker John Boehner's to allow tax rates to rise on wealthier Americans.
Failure to agree on a plan to cut the budget deficit by Jan. 1 would lead to simultaneous government spending cuts and tax hikes that could push the economy back into recession.