Two parties that started September headed for a bitter clash that could have shut down the government are now preparing for a quiet departure as each tries to shift into campaign mode.

Democrats have given in to GOP demands to lift a decades-old ban on expanding offshore drilling, paving the way for must-pass legislation to keep the government running after Oct. 1.

Meanwhile, Senate GOP and Democratic leaders have brokered a major deal to extend business tax breaks, patch the alternative minimum tax and renew dozens of expiring energy provisions — a bill each side said was necessary to complete before Election Day.

A big Senate debate expected this week over Iraq and President Bush’s troop surge never panned out, with enough Republicans siding with Democrats to advance a massive defense policy bill and choke off a long list of amendments.

And in another sign that Democrats don’t plan to wage a big fight, Senate Majority Leader Harry Reid (D-Nev.) said Wednesday that he won’t combine a stimulus package that the GOP opposes with a stop-gap spending bill.

Even though the partisan rhetoric has sharpened, the movement on legislation has been jolted by election-year realties and fear among lawmakers of appearing insensitive to the worsening economic situation.

“We’re coming together on a whole bunch of things here,” said Sen. Mel Martinez (R-Fla.). “I think maybe there’s a moment where we’re seeing the situation is grave enough that we’ve got to be grownups.”

By conceding to the GOP demands over oil drilling, Democrats are seeking to blunt the campaign slogan that they are standing in the way of lower gas prices.

In the meantime, Democrats have seized on the Wall Street crisis to launch a coordinated broadside connecting the blame with presidential candidate Sen. John McCain (Ariz.) and the Republican Party.