Good News/Bad News on the Budget

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Well, I was wrong that the news on the budget would be worse than projected, but right that the Obama administration wasn't delaying its first mid-session budget review in order to hide the bad news in the August doldrums.  The budget deficit is going to be $1.6 trillion, instead of $1.8 trillion.

The good news is, we've spent considerably less on bailouts than we expected to, and slightly less on other programs.  The bad news is, revenue was $83 billion less than expected.  The revenue declines tend to lag the recession, so we'll be in that boat for a while.    The bailout money, on the other hand, is a one-year savings.

Still, it's hard to be unhappy about a $200 billion decline in the government.  $1.6 trillion to go . . .

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Megan McArdle is a columnist at Bloomberg View and a former senior editor at The Atlantic. Her new book is The Up Side of Down.

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