Deck the Halls with Bills of Folly – On Friday President Obama signed the $858 billion tax cut package that Congress passed earlier in the week, deeming it a great bipartisan achievement. The great “compromise” greatly compromises our fiscal outlook and makes it more imperative that fundamental tax reform and a comprehensive debt reduction plan be enacted next year.

Update 12/17: The House approved of the tax cut package late Thursday on a 277-148 vote. The bill now goes to the White House for the president's signature. The Senate pulled the omnibus package from consideration and now plans another short-term Continuing Resolution.

An old cliche says that there are two things you should not watch being made--sausage and legislation. But right now, people should be watching the end-of-year process being used to allow the federal government to pay its bills. Then they'll know why we are in such a fiscal mess. Here's the current state of play:

Update: The Senate passed the tax cut legislation on a 81-19 vote. It now moves to the House, which may act Wednesday or Thursday.

The Senate is poised to pass a tax cut package that will add over $850 billion to our deficit. Meanwhile, a pork-laden $1.108 trillion omnibus spending bill was introduced in the very same chamber Tuesday in the latest chapter of the mockery that is the budget and appropriations process. Not good news by any means on the fiscal front.

Washington Drops the Ball – To many federal budget watchers, the tax cut debate has been more frustrating than watching the Redskins play. The expiring 2001/2003 tax cuts presented an opportunity not only to remake the tax code, but to transform the fiscal discussion in Washington.

Continuing its year-long lesson in "How Not To Budget," the House Wednesday passed legislation that would freeze overall Fiscal Year 2011 discretionary spending at the Fiscal 2010 levels. However, the bill, which narrowly passed 212-206, would rejigger spending within the measure to fund several programs near and dear to members' hearts. The bill now goes to the Senate, which has its own ideas about how to end the budget debacle.

Commission Can’t Quite Commit – The President’s Fiscal Commission was able to produce a fiscal plan last week that garnered a bipartisan majority of votes within the panel (11 out of 18 members), but not the 14 vote supermajority required to compel Congress to act. The question now is: will the Commission’s work go the way of many other commissions and be shelved, or can it still prompt action in Washington.

Once again, Congress earlier this week had to pass a short-term stop-gap spending measure to keep the lights on. The House and Senate passed a continuing resolution (CR) keeping the federal government funded at current levels through December 18. The resolution was needed because Congress has passed none—that’s right none—of the twelve Fiscal Year 2011 appropriations measures.

Talking Turkey – Congress takes a break this week for Thanksgiving. Lawmakers can be thankful for the brief respite, but the time is quickly coming when they can no longer speak in sound bites and generalities on fiscal matters and must get down to business. When they return next week they will have to face up to some deadlines, promises, and reality.