*Bracing for credit downgrade from S&P

Government officials are waiting for word, perhaps as early as this afternoon. From ABC's Jake Tapper:

Official reasons given will be the political confusion surrounding the process of raising the debt ceiling, and lack of confidence that the political system will be able to agree to more deficit reduction. A source says Republicans saying that they refuse to accept any tax increases as part of a larger deal will be part of the reason cited.

S&P had warned that there would be a 50/50 chance of a downgrade if spending weren't cut by at least $4 trillion.

*Update: A senior Obama administration official tells CNN's John King that S&P had planned to downgrade the government's AAA credit rating, but that the administration is challenging S&P's analysis. The source insisted the agency was off by "trillions" in its economic model. This might explain why S&P has not yet issued an announcement.

**From the WSJ:

S&P officials notified the Treasury Department early Friday afternoon it was planning to downgrade the debt, a government official said, and the firm presented its report to the White House. S&P has previously warned such a downgrade might come if Washington didn't move to comprehensively tackle its long-term fiscal woes. After two hours of analysis, Treasury officials discovered that S&P officials had miscalculated future deficit projections by close to $2 trillion. It immediately notified the company of the mistakes. S&P officials later called administration officials back to say they agreed about the mistakes, though they didn't say whether it would affect the rating. White House officials remained waiting Friday evening to see what the company would do.