Good News/Bad News on the Budget

By Megan McArdle

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 . . .

This article available online at:

http://www.theatlantic.com/business/archive/2009/08/good-news-bad-news-on-the-budget/23657/