UPDATED INTERVIEW WITH MARK ZANDI:
HOBSON: JEREMY HOBSON:Vice President Joe Biden will meet with Congressional republicans today at the White House to talk about the budget -- and the national debt ceiling. And there are reports that the two sides are getting closer to a deal to avoid letting the federal government default on its debt.
For more, let's bring in Mark Zandi, chief economist with Moody's Analytics. He's with us live. Good morning.
MARK ZANDI: Good morning.
HOBSON: So how significant is this meeting and what are they going to be talking about?
ZANDI: It is significant. They're going to be talking about how to avoid hitting the debt ceiling because if we do, the economy would probably be pushed back into recession. And they're going to layout I think some goals with respect to future deficit reduction. And some mechanisms that they would employ if we don't hit those targets in the future. So it's not about determining exactly how we hit those goals, but determining those goals as an important step.
HOBSON: And I see that they're not going to be trying to deal with the big entitlement programs and stuff like that right away.
ZANDI: No, I think that would be a big step too far. I think the thinking is that we need an election for that. And I think that's appropriate. I think we need to have a referendum on what to do about Medicare and Social Security and tax rates and those kinds of things. And the next president will decide.
HOBSON: And Mark, if they're not dealing with those big things right away, what about the concerns coming from rating agencies like S&P as well those who invest in U.S. debt?
ZANDI: Well, I think investors in the rating agencies will take solace in this. I mean, I think a few weeks ago they would've been shocked that we had gotten this far. So I think relative to their expectations this is very good news.
HOBSON: Mark Zandi, chief economist with Moody's Analytics, thanks so much.
ZANDI: Thank you.
JEREMY HOBSON: Vice President Joe Biden will meet with congressional Republicans today at the White House to talk about the budget -- and the national debt ceiling. And there are reports that the two sides are getting closer to a deal to avoid letting the federal government default on its debt.
Marketplace's Nancy Marshall Genzer joins us now, live, from Washington with more. Good morning Nancy.
NANCY MARSHALL GENZER: Good morning Jeremy.
HOBSON: So what are they talking about today? What are they talking about doing to avert a debt crisis?
GENZER: Well, Jeremy what's interesting is what they won't be talking about today. The Washington Post is reporting that House Majority Leader Eric Cantor, who'll be at today's meeting, does not think the two sides will be able to reach an agreement on Medicare or Medicaid - those big government health care programs. But Cantor says Republicans will still use a budget that passed the House as a starting point in today's negotiations. And that budget would Medicare into a private voucher program. That's a nonstarter with Democrats. Administration officials say they can compromise on some parts of the House Republican plan, including deficit targets.
HOBSON: So you've given us a lot of what they won't be talking about, Nancy. What is on the table?
GENZER: Good question. They're focusing on things that are less contentious. The Republicans want to cut government payments to wealthy farmers, including grants for worsted-wool producers. Whatever that is Jeremy. They also want to auction off more of the broadcast spectrum. The Democrats want to scour the tax code and eliminate some tax breaks. Especially for oil companies. Both sides say they want an agreement sooner rather than later, before the 2012 election season really starts to heat up.
HOBSON: Marketplace's Nancy Marshall Genzer in Washington.