Much of the hand-wringing over the debt ceiling misses a rather important point (or sometimes counts on it): We don't raise the debt ceiling so that we can pay back what we've borrowed; we raise the debt ceiling so that we can borrow more. When Treasury Secretary Geithner says that failure to raise the ceiling will result in U.S. Government default and global economic catastrophe, he's spreading an untruth.
What would happen? The Treasury can come up with ways to keep federal spending going until next fall. After that, tax revenues are still many times greater than needed to finance the debt. What they aren't great enough to do is finance the debt and pay for everything the government is obliged to pay for. That means that Social Security payments might be deferred, the oft-threatened cuts to Medicare payments to physicians might actually happen, or the government would have to shut down some services. The courts would have to decide who is owed what first, but my guess is that the repayment of debt would be near the top of the list.
The bottom line is that failure to raise the debt ceiling almost certainly won't cause default. What it will cause is a lot of Americans not getting government checks - pay checks, reimbursements, Social Security, transfers - and political Hell of the highest order. Hence I think Tea Partiers, the GOP and Geithner are all bluffing. It makes for interesting drama, though.