As the Suffolk City Council prepares to enter the heart of its deliberations on the 2011-2012 budget, the time is appropriate to consider the situation facing people all around the city — the taxpayers who ultimately have to finance whatever spending plan council members devise.

More than 500 jobs are set to be lost at U.S. Joint Forces Command in North Suffolk within the year. Elsewhere, employment news has been weakly positive during the past couple of months, with the number of first-time claims for unemployment dropping slightly for the second week in a row. Still, though, there remains an uncounted group of people who have been unemployed for so long that they have just given up looking for work. Estimates of the size of that group vary wildly, but it’s safe to say that the group is bigger than it has been in more than a generation.

Nationwide, the housing market suffered another rough month as sales of new homes in February slumped 16.9 percent to the lowest level since records have been kept, according to Hanley Wood Market Intelligence, a real estate research and analytical firm. Things weren’t much better in the existing-homes market, where sales fell 9.6 percent to their lowest level since November. Combined with an increase in the number of distressed sales — foreclosures and the like — the weak sales performance also contributed to driving down real estate prices, with prices for existing homes falling to their lowest levels since February 2002.

The unrest and uncertainty of the situation in the Middle East has helped to drive gas prices to around $3.50 locally, up more than 40 cents from a month ago and more than 75 cents from a year ago, according to GasBuddy.com. The price of food has risen sharply, in part because of the added cost of transporting it. Clothing prices are expected to rise this fall with the increase in cotton prices. And anything that comes from Japan will come at a premium — if at all — as that nation struggles to rebuild following the catastrophic events there in recent weeks.

Amidst this worrisome economic news, the Suffolk City Council is preparing to deliberate on a budget for the 2011-2012 fiscal year, and city officials are understandably interested in finding a way to maintain services at current levels. In fact, they have taken great pains in two recent meetings to point out that they have actually cut $17.3 million from the city’s general fund budget during the past five years, implying that further cuts would be too painful.

You wouldn’t know it from looking at the budget, though, which at $163 million has actually grown by $11 million during that period. The budget has grown by a million more than even inflation can account for. In other words, council cut $17.3 million in expenses during the past five years, but it found about $18 million in new spending to offset those cuts.

Hearing council members pontificate following a public comment session on Wednesday, when two dozen citizens pleaded with them to hold the line on taxes this year, it was clear that many of the city’s elected representatives believe local government has sacrificed enough in recent years. One councilman, in fact, cynically suggested that the only things left to trim in a $163-million budget are in public safety categories. His position seemed intended to frighten taxpayers into submission rather than to foster an open and creative debate on the matter of what Suffolk’s citizens truly want from their government and, furthermore, what they are willing to pay for it.

It’s not too late for that discussion to take place. But everyone will have to leave their cynicism — and their sacred cows — at the door.