The nonpartisan CBO has estimated that the deficit was $642 billion, or 3.9 percent of gross domestic product, for the year that ended Sept. 30. That’s down from 9.8 percent in 2009, the year Obama took office.

Poll Findings

Almost two-thirds of Americans say a failure to raise the debt cap would be a real and serious problem, according to a NBC News/Wall Street Journal poll. The concern is shared across party lines: 72 percent of Democrats think that way while 57 percent of Republicans and independents say the same. The poll of 800 adults was conducted on Oct. 7-9 and has a margin of error for this reading of plus or minus 4.4 percentage points.

Greg Mankiw, who succeeded Hubbard as chairman of the Council of Economic Advisers in 2003 and stayed until 2005, agreed that prioritizing payments does entail some peril. “There is recession risk,” he said in an e-mail.

That danger, though, would be far less than that posed by a potential default. “If people really thought we were going to default on bondholders, that would be terrible,” said Mankiw, who is now chairman of the economics department at Harvard University in Cambridge, Massachusetts.

Treasury Secretary Jacob J. Lew told the Senate Finance Committee yesterday that a strategy of making debt payments while failing to meet other obligations would be “default by another name.”

Mankiw took issue with that type of argument. “It’s not a default on the debt,” he told Bloomberg Television on Oct. 9. “What the debt holders care about is how the United States treats its debt.”

Risky Borrower

Holtz-Eakin disagreed. “If you managed to prioritize, you would still send a signal to financial markets that you’re not worthy of additional loans, that you’re a risky borrower and your interest rates would go up,” he said. “That’s bad news for the economy.”

Such skepticism about prioritization doesn’t mean the conservative economists agree with Obama that Congress should just raise the debt ceiling. While Republicans were wrong to try to tie an increase to a delay of Obama’s health-care overhaul, they are justified in seeking changes in the budget in return, Hubbard said.