Real estate entrepreneur R. Donahue Peebles, who backed President Barack Obama, told CNBC that Washington's solution to the "fiscal cliff" should not rely solely on pressing the wealthy.
"I don't think relying on the top 2 percent to pay this entire bill is a realistic expectation, nor would it be helpful to the economy," the CEO of the Peebles Corp. told CNBC's "Squawk Box" on Tuesday. "We have to alance significant spending cuts, and I think that means across the board, too."
The "fiscal cliff" negotiations are dominating Washington and the business world. Congress and the White House are scrambling to avoid the possibility of a weak economic recovery being derailed by a blitz of spending cuts and tax hikes on Jan. 1.
Peebles said entitlement reform was key to the entire debate. While calling on the government to preserve social spending "for those who are suffering," he suggested middle class voters could receive fewer tax breaks, or higher taxes as a show of "corresponding sacrifice."
(Read More: Dems Dig in on Plans to Cut Entitlements.)
Also appearing on "Squawk Box," Democrat Roger Altman and Ed Lazear, a former Bush administration economic adviser, said a deal to curb spending and reform entitlements should be reached sooner rather than later. However, they drew different conclusions on the outlines of what a final agreement should look like.
"Over the next two or three months is the best opportunity to really do this decisively — stop these corrosive deficits, stabilize the debt to [economic growth] ratio and solve this," Altman said. He noted that the start of a new presidential term is often when the greatest change happens.
Doing so could quickly could also restore economic confidence and spark stronger economic growth, said Altman. The Evercore Partners founder and chairman, who served in the Clinton administration, has been named as a possible successor to Timothy Geithner as Treasury secretary. (Read More: Roger Altman's Memo from the Fed Summit.)
"The chances for growth which surprises on the upside are better than people think," Altman said. "I think that between housing, oil and gas, manufacturing and the confidence surrounding a (fiscal) solution we can surprise on the upside in the United States over the next two or three years."
The investment banker said he believes any solution needs to be balanced between revenue increases and spending and entitlement cuts.
"In order to solve it, everyone has to make some sacrifice, everyone," Altman said, echoing Peebles' suggestions. "There has to be sacrifice, if you want to use that word, on the spending side and there has to be sacrifice on the revenue side." (Read More: Efforts to Curb Social Spending Face Resistance.)
Lazear said taxes and spending should be treated differently.
"Tax increases have long-term permanent harm on the economy," he said. "Spending cuts do potentially have harm in the short run, but it's a one-time deal."
He added, "If you look at the evidence on this and you look at the ability to do fiscal consolidation, what people have found is that tax increases are much less effective in terms of bringing about long-term fiscal consolidation than spending cuts."
Lazear said growth is key. With the economy only "muddling along" at 2 percent growth, Lazear said, "if we don't grow, we're not going to solve this problem in the long run."
He also warned that if compromise only solves the short-term problem, when automatic tax increases and spending cuts hit at the end of the year, "in a way that's not constructive in terms of long-term economic growth. We'll be shooting ourselves in the foot." (Read More: Mortgage Interest Deduction, Once a Sacred Cow, Is Under Scrutiny.)
Still, Altman is optimistic that a deal could be struck — especially if equity markets put some pressure on the politicians. "As we get closer to December 31st, and if there's a sense that the situation is stuck or negotiations aren't progressing ... I think the markets may become very disorderly on the equity side," he warned.