Obama had pressed for a compromise earlier in the day, pointing to the effect a shutdown of any length could have on the still-struggling economy when millions of federal workers are furloughed, businesses fail to get government-backed loans and inspections and national parks shut down to tourists.
"This doesn't have to happen," he said.
Meanwhile, grass roots tea party leaders, whose dislike for Obamacare fueled the rancor to begin with, urged conservatives to hold strong in the face of the shutdown as the only means of advancing their agenda.
"Just like in 1995, the GOP must wait this out now that we are here," wrote Erick Erickson, a conservative leader in his blog RedState.com early Tuesday. "The fight must be to either now keep government shut down till the Democrats blink or drive from office Republicans who vote to fund Obamacare. In the meantime, life will go on."