"I know it's a game of chicken, but I just don't believe that it's going to happen, because I just don't think any of us at the end of the day want it to happen for the country," said McCain on Fox News's "Your World with Neil Cavuto."
McCain slammed President Obama's visit to Michigan Monday and called on the president to bring Congressional Republicans to the White House to hammer out a deal.
The Arizona senator said he would support "most anything" to reach a deal, but declined to say whether he would condone allowing the Bush-era tax rates to rise.
"I'm in favor of most anything that would get an agreement, but it seems to me, why are we focusing on that narrow part of this entire scenario, in other words, the tax rates? Why aren't we also giving equal weight in the media and in our debates on the entitlement?" he said.
However, McCain told Fox News that he would reject a deal that included tax hikes with a promise to address spending cuts at a later date.
"I've got some beachfront property in Arizona for you, if you would accept that deal," McCain said.
McCain suggested that it might require a reaction in the financial markets to press Congress into action, despite his optimism that an agreement will be reached.
When asked if no deal is better than a bad deal, McCain said, "Well that's Hobson's choice here. I think the only thing we can do, is to make a deal and I think the American people deserve it and if we don't get it I really worry about the country."