Rep. Peter Welch, a Vermont Democrat who says temporarily going over the cliff wouldn't be so bad, noted what happened on Sept. 29, 2008. The House surprised investors by rejecting a proposed bailout of the crisis-stricken financial sector. Republicans strongly opposed the plan despite then-President George W. Bush's support. The Dow plunged 777 points, its largest one-day point drop ever.
Four days later the House, shaken by the market reaction, passed a slightly modified bailout bill.
Welch said a similar market meltdown next month, in the event of a fiscal cliff impasse, "is what will force members of Congress eventually to act."
Few lawmakers in either party are eager to predict how the stocks and bonds markets would react to a failure to reach a fiscal cliff accord by year's end.
"Let's not pretend the markets fully understand the politicians, or the politicians fully understand the markets," said Rep. George Miller, D-Calif., who has served in Congress for 37 years.
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