CBO Predicts Hefty Deficit, Jobless Figures

The CBO issued some bleak news today about the economy and prospects for a quick recovery. The nonpartisan agency predicted a $1.35 trillion budget deficit this year—on par with last year's record of $1.4 trillion—and unemployment averaging 10.1%. The forecast for next year doesn't look much better. The report came out the same day the Senate rejected a plan backed by President Obama to create a bipartisan task force to tackle the deficit.

The panel would have attempted to produce a plan combining tax cuts and spending curbs that would have been voted on after the midterm elections. The measure went down because anti-tax Republicans joined with Democrats who were wary of being railroaded into cutting Social Security and Medicare. "Yet another indication that Congress is more concerned with the next election than the next generation," said GOP Sen. Judd Gregg, a sponsor of the plan. (More budget deficit stories.)