On the contrary. If intelligence reports are right, and the terrorists have nukes, then I believe that the fact they haven't used them yet is evidence that perhaps they do actually fear what would happen in response to an attack on that scale.
If they had nukes they would have used them already.
The terrorists have demonstrated time and again that they simply do not care what the US does in response to their acts.
They believe God is on their side and that they will prevail, no matter what happens in the meantime.