by Dave McGill

Two of the president’s main objectives, mentioned during the pageant called the State-of-the-Union speech, were to reduce the deficits and to bring down unemployment. If he can do both at the same time he will truly be a miracle worker.

The fact is, any effective government measures to lower unemployment tend to raise the deficit, and any effective program to reduce the deficit tends to increase unemployment. Think of it as a see-saw. It is highly unlikely the president can bring down both ends of the see-saw at the same time.

So, the question might be: which side will have priority? Which side will get meaningful relief and which side will get impressive sounding measures that will be little more than window dressing?

The matter of the deficits, of course, goes hand in hand with the threat of inflation. And, so far, that is the side that appears to have received the greater attention from the government. This is evidenced by the simple fact that just three programs announced over the past six weeks will drain more money out of the economy than has spent during the past 11 months under the stimulus package. (Details of these programs are outlined in the previous article on this site, published yesterday.)

As of Monday, only 22% of the $787 billion stimulus package had actually been spent. This does not suggest a high level of priority for getting Americans back to work. Hopefully the upcoming election season will finally get the government to realize that in this, the third year of the recession, American workers have been the forgotten men and women.