Corporate America is putting together its investment and hiring plans for next year. But with "fiscal cliff" uncertainty hanging over the economy, many corporations may spend and hire less next year unless the fiscal issues are cleared up, CEOs told CNBC this week.
Chief executives of more than 80 corporations, including Goldman Sachs, Dow Chemical, Caterpillar and Weyerhauser have gotten together to pressure Congress to tackle the country's fiscal problems with a combination of tax reform and spending cuts. (Read More: US CEOs Call for Action to Reduce Federal Deficit.)
"If we go over the fiscal cliff we're looking at a negative 1.7 percent GDP growth for the first quarter and that means jobs and that companies like ours are going to have to pull back on our capital investment," Mark Bertolini, Aetna's CEO, told CNBC. "The sooner we get clarity the more we can invest in the economy."
Kathryn Wylde, Partnership for New York City CEO, echoed that sentiment.
"We've got more than $1 trillion sitting on the sidelines tied up in our American businesses that they're not putting to work because they can't figure out what's going to happen in Washington," she said. "We've lost faith that there's a solution to this problem. We have to bring this country together to get something done, and then we can all benefit."
(Read More: The Biggest Holders of US Government Debt.)
Pimco's Neel Kashkari expects only muted growth but not recession as most of the fiscal cliff is kicked down the road. He warned, however, "The part that's really hard for us to quantify is how much damage Democrats and Republicans will do to the economy with their fighting."
According to David Cote, Honeywell CEO, politicians need to agree on a combination of tax increases and spending cuts.
"You have you to do both," he said, "And anybody who says, 'no, you can just grow your way out of this, just raise the top two brackets, just cut spending,' it's baloney. The math doesn't work." "We're trying to be the radical middle that says, 'no, really, you have to be logical about this,'" Cote added. (Read More: US Nears Fiscal Disaster: 'Washington Doing Nothing'.)
While Cote and the other CEOs aren't offering up specifics, they have called for spending cuts and tax increases to total $4 trillion.
That will mean tax reform and entitlement reform that Aetna's Bertolini said needs to go beyond what was proposed by the Simpson-Bowles debt commission. (Read More: Jamie Dimon: CEOs Already Cutting Back Due to 'Fiscal Cliff'.)
Even the "sacred cow" deductions will need to be on the table, Robert Johnson, RLJ Companies founder & chairman, said. "That's where the devil is in the detail," he said. "Some of these deductions go right to the heart of this country's social framework which is mortgage deductions, charitable deductions, benefit deductions."