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I agree that they should stand firm, but I am not so certain that they can hold a team hostage at the deadline. For one thing the odds are that at least one of the suitors maybe two (NYY, BOS, and TOR) will be out of it by the deadline which removes a lot of the leverage the Cubs have right now in the idea that if they don't ante up their division rival will get him. Also part of the selling point with Garza is having two years of team control. It is certainly possible that they could get an equal, or even more, return at the deadline, but I think there are pretty unique circumstances that make now the time to trade Garza.
It'd be a great time to trade him, no doubt. At least one of the suitors currently being rumored could very well be out of contention at the time but that doesn't mean they will be the only ones interested at that time. Other teams could put their name into the hat at that point.