What if Congress doesn’t raise the debt ceiling by Aug. 2?

In his speech last night, President Obama urged the House and Senate to reach a compromise on a debt plan by August 2. “We can’t allow the American people to become collateral damage to Washington’s political warfare,” he said. Immediately afterward, House Speaker John Boehner gave a live speech responding to Obama, in which he pushed for Obama to sign the Republican plan to raise the debt limit. The Democratic-led Senate and Republican-led House have proposed two vastly different plans.  So, what happens if they can’t agree by the deadline?   John Koskinen served as  deputy director for management of the White House Office of Management and Budget between 1994 and 1997. Koskinen was one of the top men in charge when the federal government faced a shutdown in 1995, and talks about how the federal government prepares for a possible default.