Washington can't calm markets with talk anymore. It can only stop volatility, panic, sell-offs, higher interest rates and other market-distorting consequences by legislating. Legislating with each other. Not against each other.

Everyone knows time is running out. Even with default and a much-desired summer recess looming, the legislative process -- which produces an actual bill -- remains at a standstill.

The pity of it all isn't that bleary-eyed negotiators simply need just a few more days to iron out historic changes to the tax code and entitlement formulas.

No.

That work ended days ago and quite probably never got a specific or granular as would be necessary to turn vaguely defined conceptual agreement into actual legislation.

What's holding the nation and its economy hostage now is politics.

The long and the short of it is the short and the long of it.

Republicans want to play short. That means extending the debt ceiling seven to eight months, holding another vote then and locking in deeper spending cuts about the time the GOP primaries and caucuses are in full roar. The economics? Republicans argue the nation has extended the debt ceiling for six months or less numerous times and shouldn't fear it now. Republicans know they moved President Obama from a demand for a "clean" (meaning no strings attached) debt ceiling to a weeks-long debate about the magnitude of deficit-reduction. Phase two.

Democrats want to play long. They want to avoid a debt ceiling debate until after the 2012 election. Obama and House congressional leaders don't want to re-litigate the nation's debt load before facing voters. If they do, the ugly contours of this debate (debtor nation adrift in a stagnant economy) are unlikely to change for the better. Plus, a short-term fix intensifies the threat of a downgrade of America's AAA bond rating - a specter that would haunt Obama and congressional Democrats right as the GOP presidential race receives maximum media coverage.

These calculations and these alone will drive the size of spending cuts. Policy no longer drives politics -- as it did during the various negotiations -- Vice President Joseph Biden's or Obama's.

Back then, Democrats fretted over what might happen to Medicare and Medicaid and if inflation calculations to Social Security benefits would acceptably increase its solvency or impose unacceptable economic hardships on the elderly and the disabled. Similarly, Republicans gnashed their teeth over tax reform and eye-crossing spread-sheet calculations of revenue trade-offs stemming from lower individual and corporate rates and simultaneous elimination or shrinkage of tax subsidies, credits or deductions. All of this designed was to achieve a nearly-impossible-to-calculate "revenue neutrality" and maintain faith with party orthodoxy against higher taxes.