Why it's a mistake to think Obama will cave on the debt ceiling

Republicans are threatening to let federal agencies shut down on October 1 unless Democrats agree to strip the funding to implement President Obama's health-care law. If that doesn't work, the GOP has an even scarier plan B.

Congress will need to raise the debt ceiling in a few weeks or run the risk of defaulting on some of its debts. GOP leaders say they won't do it unless Obama agrees to delay ObamaCare.

Obama has repeatedly vowed that he won't negotiate over raising the borrowing limit, because even suggesting that the United States might not pay its bills would put the nation's credibility and financial stability at risk. "Let me say as clearly as I can," Obama said recently. "It is not going to happen."

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Republicans, however, are wagering that he'll buckle. After all, they managed to wring spending cuts out of the debt-ceiling showdowns of 2011 and 2012 without triggering an economic meltdown. Sen. Orrin Hatch (R-Utah), in a Wall Street Journal op-ed, urged Obama to reconsider, saying Republicans have mixed budget deals with debt ceiling hikes many times before.

However, it is only since Republicans won the House in 2010 that a party has threatened a government default to get what it wants.

The prospect of a partial default is so frightening that the mere possibility is enough to rattle financial markets. Annie Lowrey points out at The New York Times that government agencies have contingency plans for a government shutdown — but not for a breach of the debt ceiling. "There is really no playbook here," she says.

Indeed, economists say the nail-biting negotiations over the debt ceiling in 2011 had a significant negative impact on the fledgling economic recovery.

Jonathan Chait says at New York that GOP leaders appear to believe that the sheer magnitude of the potential financial disaster gives Obama ample reason to eventually negotiate. "It's actually a reason to believe he won't," says Chait:

There's another big reason to assume Obama will stand firm. If disaster is the country's fate, polls suggest voters will pin the blame on the GOP. "The American people don't like ObamaCare," says Ezra Klein at The Washington Post. "But they dislike the Republican Party's kill-it-at-all-costs strategy even more."