So what if they don't hike the federal debt limit?

The TV pundits get very dramatic and call it "shutting down the government" and "defaulting on our debts". Would it really be that bad?
Hard to tell. According to the usual sources Uncle Sam is borrowing 40 % of federal outlays. If we hit the debt limit, that borrowing will have to stop. That cuts Uncle's cash flow down by 40%, and he would have to reduce the check writing by 40% to avoid bouncing checks.
That's pretty drastic. But 60% of government activity could proceed as usual.
So what government activities would be in the unlucky 40%? Government suppliers and contractors should fear for their lives, they won't get paid on time, and perhaps never. Payments for projects like fighter planes would be put on hold and the contractors told to just freeze the program where ever it is. "Non essential" government workers would be furloughed. Say the departments of education, energy, agriculture, health and human services and transportation. Maybe even the obnoxious TSA.
Farm subsidies, highway subsidies, unspent porkulus money would all be frozen.
That all probably ain't enough. The next cut would be medical. Medicare and Medicaid payments would be "delayed". This would cause a firestorm among the patients and the medical business but it probably isn't as bad as the firestorm that would occur if social security checks stopped flowing.
All this turmoil will create irresistible political pressure to do something, anything. The path of least resistance would be to cave in and raise the debt limit and let the spending go on as before.
I notice the new Republican leadership in the House has wisely kept their heads down on this explosive issue.