Is there a Budget Mini Deal Happening?

Any sign of progress in Washington is a positive.

Are Patty Murray and Paul Ryan making progress toward a budget deal that could actually help the economy?

According to the Wonkblog:

The budget deal Patty Murray and Paul Ryan are crafting isn't a "grand bargain." It doesn't put the nation's finances on a vastly different path (or even any different path). It doesn't reform the tax code or overhaul Medicare. It doesn't include infrastructure spending or chained-CPI. It doesn't even replace all of sequestration.

But the deal does lift about a third of sequestration's cuts while giving agencies more flexibility to deal with the rest. It does mean the 2014 budget is the work of human hands rather than automatic cuts. It might be a vehicle for Capitol Hill to extend expiring unemployment benefits. And it would be a small but real boost to the economy.

Joel Prakken of Macroeconomic Advisors says the deal "would be a modest boost to GDP growth (relative to sequester). Maybe 1/4 percentage point." Moody's Mark Zandi adds in the possibility of extending unemployment insurance and estimates that "the lift to GDP next year compared to current law is .4. Small, but it matters."

With the Fed looking to taper, the thought that something positive can come out of Washington is exactly what the economy needs.