The question is, if we're going to be serious about reducing our deficit, can we combine some smart spending cuts [...] reduce health care costs [...] and close some loopholes and deductions? [...] If you can combine those things together, then we can not only reduce our deficit, but can continue investing in things like education and research and development that are going to help us grow.

There's no doubt we need additional revenue, coupled with smart, spending reductions in order to bring down our deficit. And we can do it in a gradual way so that it doesn't have a huge impact.

President Barack Obama to Scott Pelley of CBS News in an interview broadcast before Sunday's Super Bowl, making the case that the only sensible way to reduce the deficit is by making "smart" spending cuts, reducing health care costs, and closing tax loopholes to generate more revenue:The president's bottom-line:The problem, of course, is that unless Congress changes current law, we're going to end up with massive, across-the-board spending cuts from the sequester. Those are scheduled to kick in on March 1—less than four weeks away. As we saw with last quarter's GDP report , the sudden and severe fiscal austerity is guaranteed to hurt economic growth. It's obvious that the president does not want that to happen, but neither Pelley nor he explicitly discussed it.

The silence on the sequester is curious, given that it's an imminent threat that Congress could make go away simply by snapping their fingers, but we seem to be in the middle of a game of chicken, with House Republicans claiming they want the sequester to take place and the White House and Senate Democrats saying the only way to get rid of it is by replacing it with a mix of spending cuts and revenue increases. But the only way we're going to get rid of it is if Republicans are willing to accept revenues or both parties agree to either eliminate it altogether or postpone it again.

Everybody knows it's a terrible idea. Nobody wants it to happen. But unless Washington, DC does something to fix the problem that it created, the sequester is going to happen—and we're the ones who are going to pay the price.