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In 2009, the average business owner paid $95 per employee. This year, the tax will be $171, according to estimates by the state workforce agency. "It's another added expense to hiring somebody," Miller says. "Everything's going up, and business is going down."

Similar tax increases are hitting employers nationwide this year as states struggle to pay the 5.5 million Americans currently collecting state jobless benefits. So far, high unemployment and, in many cases, poor planning have prompted 25 states to borrow more than $25 billion from the federal government to keep benefit checks in the mail.

In other states, unemployment compensation funds are still in the black, but reserves are rapidly dwindling. Nine more states likely will be borrowing by mid-year, according to a ProPublica analysis of state revenue and benefits.

Tax on businesses

Business owners in 36 states face tax increases ranging from a few dollars to nearly $1,000 per worker. Six states are scaling back or freezing benefits for the unemployed:

• Jobless Pennsylvania workers will get 2.3% less in benefits starting this month, while the average tax this year for businesses will increase to $432 from $384 per worker.

• Hawaii's employers face an average increase to $1,070 from $90 per worker. The state also proposes decreasing the maximum benefit by as much as a third -- about $190 per week.

• Texas, where the trust fund is $1.4 billion in the red, has increased the average tax on employers to about $165 from $89 per worker.

Instead of fulfilling the unemployment insurance system's purpose of stimulating the economy, these measures may contribute to joblessness, says Gary Burtless, an economist who studies labor policy at the Brookings Institution, a think tank. "We don't want to pick this moment of all moments to boost taxes on employers," Burtless says. "We want to encourage employers as much as possible to add to their payrolls."

Workers are being hurt in another way -- through benefit cuts. In Roanoke, Va., James Hay, 70, received a letter from the state informing him that his monthly unemploymentbenefits are being cut to $100 from about $800 because state law limits payments to Social Security recipients when the state's fund runs low.

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The decisions to prosecute the failed underwear bomber and hold the rumored trial of the Bali bombing mastermind in federal criminal court in Washington, D.C. has revived the debate over whether criminal courts or military commissions are more effective in prosecuting suspected terrorists. Many conservative critics are simply seeking to exploit terrorism for political gain with specious attacks on President Barack Obama. They rely on a presumption that a military response is always the toughest available option, but even former Bush administration officials say these conservatives' faith in military commissions is misplaced. The facts are clear: Criminal courts are a far tougher and more reliable forum for prosecuting terrorists than military commissions.