The release of the Congressional Budget Office's new baseline budget projections on January 29, 2003 offers the opportunity to reassess the fiscal status of the federal government as Congress and the administration consider a new set of budget proposals. This article examines the current budget outlook, the magnitude and sources of changes in the outlook since January 2001, and adjustments to the official data that more accurately reflect the continuation of current policy and the government's underlying financial status. Based on this analysis, we also provide a very preliminary and brief assessment of the administration's new budget proposals.