Why do people care more about the U.S. debt than about unemployment?

Republicans have said that our debt is so important that, in the words of the GOP minority leader, it’s worth using the threat of default as a “hostage” in order to force us to cut spending.

Now, the markets have plunged—in large part because of the Euro crisis, but also because, according to Bank of America’s national economist, “The whole debate over the debt ceiling sent four negative messages to the markets: That we have a big debt problem, that we can’t fix it because we have a dysfunctional political system, that it’s okay to use the threat of default to achieve political ends, and that there’s no safety net if the economy goes into recession because we’re not going to have any more fiscal stimulus.”

How didn’t the markets respond? They didn’t appear to worry about our debt crisis. Panicked investors flooded into cash and treasury bonds.

We obviously have a debt problem. But what do you think is the nature of this problem? What specific harm do you think it will cause, when, and why? And is it worth spending money in the short term to fight unemployment and strengthen economic growth even if it adds to the deficit?