There's a lot I'm going to explain here.
First, me saying the opposite of government deficits/debt can never be too big:
That is almost word for word what I'm saying here, and that was a year ago. See?
Secondly, we could most certainly print money instead of issuing debt. Why do you ask? As for why lack of Republican enthusiasm is the problem is that basically all economists agree that the US should continue to deficit spend in our current situation. The Republicans are trying to stop that, therefore they are a problem. Pretty simple, really.
Finally, the ratings agencies specifically mentioned a lack of faith in the US political process as one of the biggest reasons for the downgrade... ie: they know as well as we do that it is by definition impossible for the US to default unless it chooses to, they stated they were worried the US might choose to. (also, government debt can lose value due to inflation, etc.)
Simply put the US's debt is nowhere close to our largest problem right now. Furthermore, austerity would only make things worse, as evidenced by pretty much every country that's tried it in this crisis. Why anyone would want to follow such abject failure is beyond me.