Must everything be cast as false dichotomies? The US economy, in terms of GDP, consumer spending, etc. can be robust and weathering the blow from the hurricanes well at the same time that budget deficits represent a point of concern. You could perhaps say, the private sector economy is faring well, but government is walking somewhat treacherous ground with respect to the economy. There's still time for deficits to be dramatically cut before any serious effects are really felt, and in the meantime the economy looks reasonably healthy in other respects. That involves actually significantly slashing deficits however - the current situation is not a sustainable one, and certainly cannot continue indefinitely. When exactly will the chickens come home to roost and potentially serious economic problems result? That's almost impossible to say, there are simply far too many factors involved. Unless there are changes, however, it will most certainly happen eventually.