Robert Samuelson, a respected economist and columnist, poses this question here.
A good question, but his analysis is not quite on the mark. More interesting and relevant stuff is missing. Also he puts in a few alarmist bits for effects: "stampede in selling off stocks" is one such.
What does it mean "going broke"?
In normal parlance for mere mortals like you and me, that means typically the following:
1) your "friendly neighborhood" bank that holds your mortgage will take away your home because you are behind in your payments.
2) ditto with credit card
3) ditto with all your other valuables because you have pledged them to get loans to sustain your past life style
4) you got fired by your company because my my your disappearing credit in our civilized society marks you as an undesirable to be avoided.
Well, that's not going to happen like that in the case of US of A.
What would happen is something like this:
1) US government bills and bonds are begging for buyers by offering junk bond grade interests the way bad credit countries such as Argentina, Mexico and the likes have done so in the past.
2) dollar would remain weak and weaker
3) Contrary to Samuelson's scare words, stock markets may briefly tank due to some short term panic, however, as long as US companies continue to be creative and productive (e.g., Apple, Microsoft and yes even Goldman Sachs in financial engineering), foreign buyers can't wait to scoop up their shares.
I am just giving you a flavor of a list that is much longer.
Samuelson used Japan as a case study. At one point its debt to equity ratio, indeed, went sky high as that of the US would also do so. But hey, Japan never went "broke" in the normal sense. it is alive and kicking.
What needs to be watched carefully is this: id US consumers, meaning you and everyone else who live in the country, continue to live beyond their means on credit, then the Japan case study is irrelevant. Japan is a high savings country. US is not. Then US may not go "broke" but will look more and more like a Third World country -- a subject I have written much in my blog.
US leaders will behave in front of its credits with heads bowed speaking gently and with humility. And guess who is the single largest creditor?
Hint, It is a country that is a strategic competitor to the US and was once given a color to describe its ideology. If you don't know that immediately, you are not "allowed" to read my blog anymore.