Democrats, who have controlled the budget process for the past two years failed to pass a budget. Now, with a completely arbitrary Aug 2 deadline, these same Democrats, chief among them Pres. Obama, are crying wolf that the US won't have enough money top pay it's bills, otherwise known as the deficit/debt.
Obama has made it quite clear and official that the social security funds aren't there and haven't been for decades, Again thanks to reckless Democrat budgets over that time period. He uses them as a weapon in his desperate bid for an increase in the maxed out credit card limit known as the US Treasury.
To put it quite simply, the debt limit increase is congress voting itself a new line of credit to pay off the debts on the previous lines of credit. In layman's terms: if your credit cards are all maxed out and you are making minimum payments just to keep above water and open a new credit card to pay down the other credit cards, it is only a very short time before the new credit card is maxed out and you are back to the same position, only with even more debt to your name.
By capping the credit limit and reducing the spending, more money is freed up to pay the debts. Yes it will take some time to reach a zero balance, but it does really happen that way.