The Republicans have gone insane. Polls show 40% of them do not think going into default would be catastrophic.
Remember, these are the same people who keep comparing the US government to an ordinary household. "We have to live within our means, tighten our belts, yadda yadda yadda." Well, what happens to an ordinary household that stops paying its bills?
They lose their house. The bank takes it away. And that's what's going to happen here. The economy will crash, the dollar will collapse, deflation will explode, houses will be repossessed and sold at auction, and people with huge reserves of cash will buy everything. The bankers will use the money we gave them in the bailout to buy our public assets. Then they will lend us that money back again, at higher interest rates.
Well, I say us, but really I mean you. I live in a sane country, where 40% of the electorate does not believe that sabotaging the country for the benefit of bankers is a good idea.