It could have been worse - although I'm at a loss to say how. I guess projections of a $2 trillion deficit last winter means we dodged a $600 billion bullet. But that is hardly comforting.

Fox News has the official word:

The Congressional Budget Office estimate, while expected, is bad news for the White House and its allies in Congress as they press ahead with health care overhaul legislation that could cost $900 billion over the next decade.

The unprecedented flood of red ink flows from several factors, including a big drop in tax revenues due to the recession, $245 billion in emergency spending on the Wall Street bailout and the takeover of mortgage giants Fannie Mae and Freddie Mac. Then there is almost $200 billion in costs from President Obama's economic stimulus bill, as well as increases in programs such as unemployment benefits and food stamps.

The previous record deficit was $459 billion and was set just last year.

The Obama health plan would be "paid for" with new revenues and curbs in spending. But the overhaul effort would eat up tax increases and spending cuts that could be used to bring the deficit down.

Obama has attributed the nation's dismal fiscal situation to the financial and economic crises he inherited. White House Budget Director Peter Orzsag is overseeing the administration's efforts to tackle the soaring deficit next year.

"As part of the fiscal 2011 budget, we will be putting forward proposals that return us to a fiscally sustainable path and that have lower deficits in the out-years," Orszag said in a recent Associated Press interview.