While the prospect of default is certainly frightening and disturbing, although a rare event, it has happened twice before in our nation's history. The 1979 debacle was very similar to today's kerfuffle, a case of last minute brinkmanship that cost our nation approximately $12 billion dollars in U.S. Treasury bill interest.
The 1814 default was a far graver event than either 1979 or the current crisis. Rather than an angry mob of House Republicans intent on burning down the government, the protagonists at that time were the British. During the War of 1812, marauding troops from Ireland and Great Britain sacked our nation's capitol after the Battle of Bladensburg on August 24, 1814.
British Major General Robert Ross occupied the city and torched both the White House, Treasury and Capitol. The only public building that escaped untouched was the United States Patent Office. A separate force took Alexandria, Virginia. The United States burned its own Navy Yard so that the ammunition would not fall into the hands of the enemy. This is the only time since the Revolutionary War that our country has been occupied by a foreign power.
According to historians, the British were free to prosecute the War after their long time antagonist Napoleon (who is actually a close genetic L-792 paternal relative of mine) was exiled to Elba. The Earl of Bathurst, who was the British Secretary of War, planned to launch additional attacks in Bermuda, New Orleans and Virginia.
It has often been stated in print, that when Mrs. Madison escaped from the White House, she cut out from the frame the large portrait of Washington (now in one of the parlors there), and carried it off. She had no time for doing it. It would have required a ladder to get it down. All she carried off was the silver in her reticule, as the British were thought to be but a few squares off, and were expected any moment. John Susé [Jean-Pierre Sioussat] (a Frenchman, then door-keeper, and still living) and Magraw [McGraw], the President's gardener, took it down and sent it off on a wagon, with some large silver urns and such other valuables as could be hastily got hold of. When the British did arrive, they ate up the very dinner, and drank the wines, &c., that I had prepared for the President's party.
Because the Treasury and all its contents were burned, the United States had no way to pay its debts or its soldiers. After an accidental explosion that killed thirty British men and a bout of inclement weather that included a tornado, the British returned to Bermuda and back across the pond, their pride assuaged for what they considered ill treatment by the Americans of British holdings in both Canada and northern Lake Erie.