"By dint of what comes in on a day-to-day basis, the government can keep paying about 60 percent of its bills, and will fail to pay the other 40 percent," says Alan Blinder, a Princeton professor and former vice chairman of the Fed.
If you're relying on a government check — a benefit check or a paycheck — you may or may not get it after Aug. 2. (The government is scheduled to deliver a round of Social Security checks on Aug. 3.)
Some lawmakers are trying to figure out who's first in line. A trio of Republican lawmakers introduced a bill on Wednesday that would have the government prioritize military salaries and debt payments. Not on their list? Social Security and unemployment.
Interest rates are extremely likely to rise. That means higher rates for credit cards, home mortgages, auto loans, and student loans, among others. How much they go up depends on how panicked the market gets.
"Even if it doesn't turn out to be calamitous, almost surely it's going to raise Treasury interest rates," Slaughter says.
That would bring the borrowing capacity of families down, and could seriously slow down business investment — which means less hiring.
The worst-case scenario? "If the markets really go into a tizzy, we may get to a situation in some markets where the rates hardly matter at all because you just can't get credit," Blinder says.
If the impasse lasts for more than a few days, the economy will "almost certainly" be pushed back into a recession, Blinder says. That's because of an unprecedented cutback in government spending. Even if the government avoided default by paying off its debt, losing the ability to borrow would mean a 40 percent drop in government spending — about 10 to 11 percent of GDP.
The stock market is very likely to tank, as well, driven by a serious loss of confidence in the U.S. government.
"You will get the investing community, not just of the United States but of the entire world, thinking that we've lost our marbles over here," Blinder says. "And we will have — because [failing to raise the debt ceiling] is a completely crazy thing to do."