I don't see them cutting him if they fail to trade him. At that point there's nothing to lose by letting him play out his contract, they can call the kids up in September anyway.
Cutting him after the deadline is a compromise. It maximizes the possibility of unloading him, but it also gives the fans something if they can't move him, as well as gives somebody from the minors a little extra playing time. Saying that there's nothing to lose by letting him play out his contract is like saying you've got nothing to lose by letting an idiot finish the horrible paint-job on your house because you already paid him instead of cutting him 2/3 of the way through and hiring someone else.