The Senate has adjourned for the day Sunday after failing to reach an agreement on a deal that would avert the so-called fiscal cliff. That leaves the legislative body just one more day to hammer together an agreement that would prevent automatic spending cuts and tax increases that kick in Jan. 1.

“There is still time left to reach an agreement, and we intend to continue negotiations,” Senate Majority Leader Harry Reid said early Sunday evening. “We’re going to come in at 11 a.m. tomorrow morning. We’ll have further announcements, perhaps, at 11 in the morning. I certainly hope so.”

NBC’s First Read:

Reid and Senate GOP Leader Mitch McConnell had been tasked by President Barack Obama with developing a bare-bones deal to stave off the automatic tax hikes following the expiration of the 2001 Bush tax cuts at the end of the day on Monday.

But discussions between the leaders and their staff failed to produce an agreement. Democrats said that a main hangup involved what’s known as “chained CPI,” a re-calculation of how Social Security benefits grow in outlying years. Democrats regard that proposal, which Obama had previously offered to Republicans in the context of a broader bargain, as a “poison pill” if included in these last-ditch efforts.

The impasse prompted McConnell to reach out to Vice President Joe Biden, a former senator who’s previously helped navigate congressional standoffs, in hopes of jump-starting negotiations. Biden was at the White House on Sunday afternoon.

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Forget the Times Square ball drop in New York City. The most dramatic moment of New Year’s Eve 2012 may happen on Capitol Hill.

— Posted by Tracy Bloom.

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#barack obama#congress#democrats#economy#fiscal cliff#government#harry reid#joe biden#mitch mcconnell#politics#republicans#senate#spending#taxes