The threat of Congress blowing the deadline to raise the debt limit is starting to look more serious. The Hill's Michael O'Brien reports today that McConnell responded to radio host Jed Babbin's assertion that "this is going to be another exercise in brinksmanship" by saying "Yeah, you're probably right about that." The vote is Republicans' best chance to extract big spending cuts, he said. He added that the vote is "the point of maximum leverage, and we intend to use that leverage."

Rep. Paul Ryan told CNBC Tuesday that, in his talks with bond traders, "they all say, whatever you do, make sure you get real spending cuts, because you want to make sure that the bondholder has confidence that the government's gonna be able to pay them."

Frum Forum's Andrew Pavelyev finds it "scary" to watch Ryan playing down the consequences of not raising the debt--and on top of that, his arguments don't "make any sense." There doesn't appear to be a "crisis of confidence among bondholders," Pavelyev says, as current yields on Treasury bonds are much lower to what they were in the late 90s, when the budget was balanced and unemployment was low. And bondholders wouldn't care that much about long-term deficits, as 90 percent of publicly held debt matures within the next decade--long before Ryan's plan actually balances the budget, he writes.

So far, The New Republic's Jonathan Chait writes, the markets don't yet think the default threat is serious. But maybe they should: "There's massive systemic risk embedded in the system," he writes, in the form of the current obduracy of some sections of the opposition party, "but the markets have remained complacent simply because the consequences haven't revealed themselves," he writes. Chait notes that Tea Partiers are ready to mount primary challenges to Republican leaders like John Boehner and Eric Cantor because they don't think the debt limit needs to be raised, ever.

Meanwhile, Standard & Poor's told Talking Point Memo's Brian Beutler that if the government misses just one debt-service payment, the country could lose its triple-A credit rating. Chait hopes that if Congress delays till the last minute, they'll "reach the point where the business lobby panics enough to exert enough pressure on Republicans to balance out the pressure from the base. And that point probably won't occur until the market has actually reacted to the impasse."