Paul Krugman can keep arguing that debt doesn't matter, but I'll stick to real world economics and keep an eye on US debt lest this happen to me.
It's a bit different. This would never happen in the US in my opinion.
If US can invalidate math, then yes.
The theoretical upper limit is the interest paid on debt: an economy can't pay more interest than the face value of goods and services it produces.
Of course, the Federal Reserve can simply reduce the interest rate near zero through a trick, as they are already doing for the US government (interest paid by the government on US debt held by the Federal Reserve (QE) is paid back to the government). They can to do it forever. But there is a price tag: it is
destroying market mechanisms (interest market - the core of capitalism - through artificial interest rates), thus eroding capitalism on the long term and finally blowing up the currency. The only way out is the belief in Krugman's outer space alien attack.
http://www.youtube.com/watch?v=KyxURk_c5dU