"The clock is slowly ticking toward Aug. 2, the date on which the U.S. faces "fiscal Armageddon" — according to the Obama administration — unless Congress agrees to raise the debt ceiling. But would we?"
Yes, it's an Armageddon according to the Obama administration. But also Speaker Bohner. And Senator McConnell. And Moody's. And the CBO. Etc.
It's also terribly inaccurate, even from a Cato perspective. A 44% cut in federal spending really isn't accurately described as something that will "almost certainly hurt." Pretending to believe that that's doable in any sensible way doesn't lend much credence to the writer.
Even if it were possible to do things as he suggests, it wouldn't solve the central problem. The United States has _legal obligations_ to pay Social Security benefits, make sure our retired soldiers receive their pensions, and other civil servants get the healthcare benefits they're entitled to as part of their agreed upon compensation package. These aren't things you can go "oopsies, I don't feel like paying it, maybe next month." And even if you were to do this with extremely questionable legality, it wouldn't help the central issue, which is faith in the credit of the United States. If I pay off my credit card bill but have to renege on my mortgage and car payments to do so, my credit is still going to be shot.
Lastly: this is about two weeks late in Republican messaging. It's now Obama who's pushing for larger long-term deficit reduction and spending cuts than Republicans (on the order of 4 trillion instead of 2 trillion over the next decade). This is, it should be said, not merely twice as big as the Republican package but also twice as stupid and boneheaded. Regardless, that's how things stand--Republicans are likely to refuse Obama's 4 trillion in favor of their 2 trillion, which is only half as stupid so on net good for the country. Good for them, but unfortunately it undermines the Cato dude's argument about it being about the deficit.