A deficit reduction package to preserve short term economic growth by delaying the most aggressive measures would a no-go for the markets, the private sector and politicians, business leaders who advise the White House told CNBC on Wednesday.
The idea of a "balanced approached" has shifted from talk about revenues and spending cuts to what's good for the economy now and in the future, said Blair Effron, co-founder of the independent investment banking and advisory firm Centerview Partners. "When you use the phrase 10 years out — the markets and the private sector — that wouldn't mean much."
Altman, deputy Treasury secretary under President Bill Clinton, agreed that pushing off the bulk of the deficit-cutting measures would help the economy in the near term. "But the politics don't permit that right now. And the big fight that's going to occur ... is 'the sequester.'"
On Tuesday, President Barack Obama said that Congress should pass a short-term budget plan to delay the across-the-board spending cuts due to take effect on March 1. The process known as "the sequester" was postponed already for two months as part of the deal at the beginning of the year to avoid the Jan. 1 "fiscal cliff."
"They all know that it's taxes and entitlement reform," Cote said. Entitlement reform "needs to happen, but they are all scared to death to talk about it … because neither party wants to be the guy to move."
Altman pointed to the president's mid-December offer that put entitlement reform specifics on the table. "[It's] still on the table if the Republicans would join the issue on the revenue side," he said. "I don't think that's likely."
Republican leaders want the discussion to replace "the sequester" to shift to reducing government spending and debt since the fiscal cliff deal was mostly revenue-generating tax increases.
Cote countered that the "revenue [issue] is not done" if the GOP wants entitlement reform.
(Read More: CBO: Budget Deficit Estimate Drops Below $1 Trillion)
But offering something everyone on Wednesday's "Squawk Box" debt special could agree with, Effron said, "Clearing the underbrush of a lot of these policy issues in Washington and letting us get into a more certain footing is the cheapest form of stimulus we could have."
—By CNBC's Matthew J. Belvedere; Follow him on Twitter