Here in the Lower Mainland of British Columbia, the government is still on a major spending/road building spree, witness the construction on Highway 1, etc.
The bottom line is that most countries in the world will have no choice but to "monetize the debt" i.e. to print money in order to repay the debt. The problem being is that it can easily result in "stagflation" i.e. a stagnant economy and rising prices.
The possible saving grace in this scenario is the high growth rates of Asia, but the downside to this is the accumulation of power by China and the reduced global influence of the US.
Now you can criticize the US all you like, but I would much rather have a strong US and a weak China than the reverse.
See here:
http://www.cbsnews.com/video/watch/?id=7166293n&tag=contentMain;contentAux
FYI, I'm Canadian and interestingly the Canadian dollar and US dollar are close to par, this has not been the case with any consistency for a long time and IMHO there is much to suggest this parity will continue.