The US is in a bind. Our leaders have no ethics and the economists at the Federal Reserve are incompetent. There are four possible endings to the US government's current fiscal position and only 2 are plausible. Currently interest on government bonds is at historic lows and such a situation cannot last. When interest rates go up, either because the Fed reduces quantitative easing or because inflation becomes too obvious to ignore, the payments for the debt will begin to consume a significant portion of the budget.
The US government will either default on its debt obligations or we will suffer hyperinflation. The other two possible but unlikely options are tax hikes with no spending increases or spending cuts. Let me fist explain the unlikely options.
The only time government spending declines is when temporary spending ends. Spending on long term programs is never cut. The government's spending problem is so bad that they lie and claim spending cuts when they increase spending by less than they originally planned.
If spending cuts are off the table, what about tax increases. I am not talking about increasing tax rates but tax revenues. The confusion between tax rates and tax revenues makes this a hard path to follow. Regardless of the tax rates, the government has historically never taken more than about 19% of GDP. To increase tax revenues, the government has to promote progrowth policies. However, the government prefers to try increasing revenues by increasing rates which has the effect of reducing growth and thus reducing future revenues and exacerbating the debt crisis.
Even if the government could increase revenues, that does not mean it would fix the problem. Historically the government has taken additional revenues and increases spending by the same amount plus more.
Now that we know what won't happen, what are our remaining options. The government will either default because it cannot continue to make payments on the debt or the Federal Reserve will monetize the debt and we will suffer hyperinflation. Clearly the country would be better off with default. Some would suffer who held US debt but everyone will suffer from hyperinflation.