I honestly don't see that happening. Our guys in the treasury are way to smart for that, they know that not paying our bond obligations will destroy the country for years if not decades.
What they will do is simply stop paying government employees, and entitlements, and possibly venders, much like they have already done only on a more grand scale. That Oct 17th deadline realistically is more like the 20th or 21st due to the current "slimdown". If we go past the 20th or 21st, the treasury will continue to redeem bonds, and will actually still be allowed to issue more bonds, in the same amount as what they redeem.
Now seeing how the treasury is part of the executive branch, what gets paid or not paid will be in the hands of Obama, who will be sure to use this special power, almost a gift given to him by tea party radicals in the House, to cause as much harm to big supporters of the republican party as possible, while minimizing it's impact on democrat supports. We've already been seeing this, so it should be a surprise to no one.
I'd imagine that since older folks tend to vote republican, social security will be the first thing not to get paid. Now when voters get angry, they tend to vote for the other party, so democrats should gain voters in the older demographic. While obviously republicans will accuse Obama of purposely targeting our retire folk, Obama can point out that it is Republicans who actually suggested cutting back on medicare and social security (just this week), and make a pretty convincing argument that it was the republicans idea to withhold social security benefits.
The second thing to be targeted will be all other entitlements. by withholding all entitlement checks (and ebt cards), it will make it easier for Obama to justify withholding social security checks. The "taker" states tend to be republican states, thus again, this will harm republicans more than it will democrats.
I would imagine that we would see large closures of military bases - mostly in republican leaning states, like mine. I live in SC, we have Parris Island, which is the marine basic training site, and Ft. Jackson is adjacent to our capital city, and is a major army basic training site. Since undoubtably we will just stop taking new recruits (rather than to "fire" combat seasoned veterins), then we will have no need for Parris Island or Ft. Jackson to remain open. A major hit to the SC economy, and another major shift in our voter base from republican to democrat.
Otherwise, just basically any payments or contracts with federal government vender corporations which give larger contributions to republicans than democrats will be the next on the hit list. The CEO's of those companies are going to be furious, and they will complain to any politicians that they "own", and put so much pressure on these republican donation receivers that they will have to cave.
This is a now win situation for conservatives, and a must win situation for democrats. I believe that we are seeing the disintegration of the republican party before our eyes. Never thought it would go down like this, I have NEVER voted for a democrat in my life.
