Deficit to shrink by $80 billion to just $1.3 trillion: Now don’t you feel better?

This morning, January 26, the Congressional Budget Office (CBO) released new projections showing that–if current laws and policies remained unchanged–the federal budget would show a deficit of $1.3 trillion for fiscal year 2010.

That’s what passes for good budget news these days. The new estimate is down $80 billion from the budget office’s previous estimate.

Of course, as a percentage of the economy (as measured by GDP) the deficit would be the second largest since World War II.

And in the big debt picture an $80 billion swing is barely a drop in the bucket. The CBO projects that total (on budget) federal government debt will reach $8.8 trillion by the end of 2010.

But wait, the news gets better. (Well, maybe not  better. How about ‘funnier if it weren’t so important?”)