2011 began with Congress digesting a report called The Moment of Truth. Commissioned by President Barack Obama and co-authored by two experienced Washington hands, its 66 pages pulled few punches.
America's debt was the greatest threat to the country's national security, it argued, before laying out a comprehensive plan to cut it. As the year draws to an end, and the report gathers dust, it is hard to escape the irony that the Pentagon is now facing a $500m (£319m) cut to its own budget from the start of 2013. That the Defence Department is in the line of fire sums up a year of failure by politicians to confront a national debt that quietly passed the $15 trillion mark last month. It's been a two-part failure and is worth briefly recapping.
In early August, Congress just avoided default by raising the country's $14.3 trillion debt ceiling. As part of that deal, $900m in cuts were agreed on and a committee established to find another $1.2 trillion of savings by the end of November. Failure to do so would trigger automatic cuts in government spending, including the Pentagon. A day before the Thanksgiving holiday, the committee's 12 members admitted they couldn't agree.
Bond investors haven't blinked at the lack of progress this year. The yield on the 10-year US government bond has hovered close to a record low for the past six months. Many on this side of the Atlantic know that the explanation for the bond market's leniency lies in Europe.
Unsure whether the euro will survive, global investors have poured money into the US Treasury market. Analysts at Bank of America estimate that the yield on the 10-year bond would be half a percentage point higher without Europe's woes.
But with 2012 coming into view, there's an uneasy recognition in Washington and on Wall Street that America's reckoning on the deficit is moving closer. "We've seen a lot of European countries take a bath this year," said Bill Frenzel, the former top Republican on the House of Representatives Budget Committee. "For a country that can't pay our bills, it's miraculous that our interest rates haven't gone up. It can't last," he says.
While most would agree with the former Congressman, no one is expecting Washington to summon the will to tackle the country's debt until after next November's presidential election. But how, as well as how quickly, the national debt should be reduced will be one of the defining battles for the White House.
Most people's reflex reaction is that the debt, which is projected by the Congressional Budget Office (CBO) to reach 67pc of the country's gross domestic product this year, compared with an average of 37pc over the past 40 years, will be addressed after the election. There are reasons to be sceptical, though.
Opinion polls suggest that the race for the White House, as well as seats in Congress, will be extremely close. That leaves open the possibility that power in Washington will still be split between the parties.
And even after you strip away the election rhetoric, the parties do fundamentally disagree. In simple terms, Democrats are loath to cut spending while Republicans won't yield in their refusal to raise taxes. The two are currently split over how to pay for an extension of a jobs-tax cut that expires at the end of the year.
What really worries bond investors is that this intransigence will only harden when much tougher agreements need to be struck to rein in the long-term trajectory for the deficit. A mix of rising health-care costs and a growing pool of retirees has put the deficit on an unsustainable path, according to the CBO. Its best-case scenario predicts America's debt to GDP ratio will reach 84pc by 2035, while in its worst forecasts it will reach 190pc.
"If in 2013 no progress has been made on these major structural issues behind the deficit, then the bond market will get worried," says Priya Misra of Bank of America. Just as Europe's crisis has helped US politicians avoid the deficit this year, Misra says the biggest immediate threat to the low yields on US debt would come if Europe began issuing Eurobonds. That would provide a serious alternative to the Treasuries. That, for now at least, seems unlikely.
But that doesn't diminish the growing feeling that, despite all the advantages America enjoys, the long-term trajectory of its debt needs to be grappled with soon. Most likely alongside a short-term stimulus for an economy few expect to be growing quickly by the start of 2013. "Austerity is coming to this country, it's just a question of its form," says John Briggs, an analyst at RBS. It's going to be an anxious wait for Americans and global investors.