"We're prepared to put revenue on the table as long as we solve the real problem," said Senate Minority Leader McConnell, referring to spending on popular programs like Medicare and Social Security, after the meeting.
McConnell is typically reluctant to acknowledge that higher taxes will result from any budget negotiations.
His ideological counterpart, House Minority Leader Nancy Pelosi was equally, guardedly optimistic.
"I feel confident that a solution may be in sight," Pelosi said.
But their optimism ignores the existing ideological gulf between conservative Republicans, many of whom refuse to concede higher taxes, and congressional Democrats, many of whom want social spending beneficiaries to be held harmless, and for revenues to equal spending cuts dollar for dollar.
During the meeting, an aide to an influential House conservative told TPM, "the GOP conference is still much more conservative than it is moderate, and folks in the House are not going to compromise their principles because a Democrat-crafted and media-driven narrative told them to do so."
Simultaneously, liberals in the Senate have let it be known they expect President Obama to drive a hard bargain in negotiations, and secure progressive interests in his pursuit of a "grand bargain" with Republicans.
"I think we're all aware that we have some urgent business to do," Obama said as the meeting kicked off. "We've got to make sure that taxes don't go up on middle-class families, that our economy remains strong. That's an agenda that Democrats and Republicans and independents, people all across the country share. So our challenge is to make sure that we are able to cooperate together work together find some common ground, make some tough compromises build some consensus to do the people's business."
Pelosi set an aspirational Christmas deadline for party leaders to resolve their differences enough to to outline the scope and size of the deal and make clear that the looming austerity bomb will not be detonated.