Sad, empty threats from a cabal of deluded conservatives
There was never much hope that President Obama and the group of compromise-oriented GOP senators he's been negotiating with would ever agree on a Big Budget Deal™.
But now that their discussions are officially in abeyance, we have a slightly clearer view of how the fights over sequestration and increasing the debt limit will play out. If a "grand bargain" is now entirely outside the realm of possibility, then Congress will have to increase the debt ceiling cleanly, or with only ceremonial provisions attached to it.
In a great piece for the Washington Post, former Treasury Department chief of staff Mark Patterson provides a useful reminder that there are many ways to skin a cat. The key thing to remember is that though there are two parties to the debt limit fight, their demands aren't equally firm.