As the stock market tanked last week, the minority view is that investors believe Congress did not cut the budget deeply enough. But the real reason is that people who own stocks see a tsunami of reasons for economic pessimism and are fleeing for the lifeboats – transferring wealth into other safer investments.

As the popular call to cut government spending continues to sound, we’re also starting to hear vocal concerns about an unfortunate side effect of that quest. The worry? That newly mandated cuts in government jobs and spending really will just add one more obstacle to America’s ability to scramble back to safety.

As Nobel Prize-winning economist Paul Krugman observed in Friday’s New York Times, “why should we be surprised at this catastrophe? Where was growth supposed to come from? Consumers, still burdened by the debt that they ran up during the housing bubble, aren’t ready to spend. Businesses see no reason to expand given the lack of consumer demand. And thanks to that deficit obsession, government, which could and should be supporting the economy in its time of need, has been pulling back.”

Last week’s somewhat positive news – a glimmer, really – about a 10th of a percent decline in the national jobless rate conceals a deeper truth that is apparent to nearly everyone: Many Americans have given up even looking for work, and thus aren’t counted as unemployed.

In places like Grant County, the statistics are further skewed by another trend – employable people are pulling up stakes and moving elsewhere because of the lack of jobs. For those who remain, the recession seems institutionalized, with the latest bad news coming on top of literally years double-digit unemployment.

Now what has been all too common here is now on the verge of becoming a lasting blight for the whole nation. “For the first time since the Great Depression many American workers are facing the prospect of very-long-term – maybe permanent – unemployment,” Krugman observes.

This will drag down tax receipts for decades to come and threatens to eventually lead to social instability. Political radicalism and wars are the inevitable results of widespread hopelessness.

Creating jobs right now must become the first priority for our national elected leaders. Otherwise, this economic train wreck will leave no life untouched.