In the short term, the most important result of the compromise is that, by increasing the debt ceiling by at least $US2.1 trillion ($A1.9 trillion), the threat of an imminent default on US government obligations will not arise again until at least 2013. That means this Damoclean sword will not hang over the global financial system through a bitterly contested presidential and congressional election year in 2012.

Second, $US900 billion of expenditure reductions over the next 10 years have been ''locked in''. This is by no means enough to put the US's public finances on a sustainable footing - the non-partisan Congressional Budget Office projects that the US will run up budget deficits totalling $US6.7 trillion over the next decade on unchanged policies, and almost $US9.5 trillion if the administration's 2012 budget were enacted in full. The compromise agreement also includes a commitment to find a further $US1.5 trillion in spending cuts through a bipartisan committee whose recommendations will attract the same ''fast-track'' status as trade agreements - that is, they can be passed or rejected by either house but not delayed or amended in Congress.

True, the record in recent years of efforts to reach agreement on meaningful deficit reduction measures through bipartisan committees or commissions doesn't inspire optimism. But this agreement is backed up by a legislated commitment to ''sequester'' (a congressional expression for ''freeze'') expenditures unless at least $US1.2 trillion in deficit reduction over the next decade is agreed by 2013.

Third, the compromise includes - among the $US900 billion of savings committed to ''up front'' over the next decade - some $US350 billion out of the ''baseline'' defence budget (that is, abstracting from savings achieved through the winding down of US troop commitments in Iraq and Afghanistan). And the ''sequester'' arrangements provide for half of any further savings resulting from the operation of those arrangements, if they are triggered, to come out of defence.

Fourth, the bipartisan committee responsible for finding an additional $US1.2 trillion of deficit reductions over the next decade will be empowered to consider ''tax reforms'' as well as spending cuts. That's critical because - notwithstanding the vehemence of Tea Party Republicans on this score - it's fatuous to think that deficits totalling somewhere between $US6.7 trillion and $US9.5 trillion over the next decade can be substantially reduced, let alone eliminated, solely by spending cuts. Not only is that unfair, by any reasonable interpretation of that often ideologically laden adjective, but it is simply unrealistic.