Former Treasury Secretary Robert Rubin and other former Clinton administration officials reflect on the last time Washington was divided over a debt ceiling debate, and why this time it's different.

By Tory Newmyer, writer

FORTUNE -- Here's the scene from 1995: A default on the federal debt is looming; young, newly-empowered Republicans on Capitol Hill are looking to use that threat as leverage to push their budget proposal; a Democratic White House is straining against their demands for major reforms in the name of deficit reduction; and the Treasury Secretary is broadcasting calm to keep the markets from spooking while trying, simultaneously, to impress the doomsday consequences of a default.

Sound familiar? That was the last time the United States seriously flirted with a debt ceiling collapse. The scenario, of course, is replaying now, as policymakers brace for the next installment of a partisan showdown over the size and scope of government. The feds are on track to reach their $14.29 trillion borrowing limit in mid-May, and the Obama administration says juggling accounts can only buy time until July 8. After that date, the government will default on its debt -- a nightmare event that would gut investor confidence in U.S. bonds, send our borrowing costs soaring, and in all likelihood, precipitate another global financial meltdown.

For months, the White House has been working behind the scenes to avert that outcome by lobbying for a simple, so-called "clean" hike of the debt ceiling. But Congressional Republicans are intent on demanding that any raise come with at least some of their deficit-cutting priorities. With market watchers nervously tracking the face-off as the clock winds down, it's worth taking a look back at the last time a political fight nearly ended in default.

Largely forgotten now, even inside the Beltway, that standoff on the debt limit actually framed what would become a much noisier fight over a government shutdown. Starting in the spring of 1995, then-House Speaker Newt Gingrich (R-Ga.) and his allies in the new GOP majority were plotting to use a vote on the debt ceiling to force President Bill Clinton to adopt their seven-year balanced-budget plan. The issue had prompted partisan skirmishes over the years, but what appeared to distinguish this round was that Gingrich and others in the GOP were actually threatening to follow through and force the nation's first-ever default if the White House didn't agree to its terms. More