When the Federal Reserve’s rate-setting committee meets today, members will ask one another: “What’s the worst that could happen if we take a particular course of action? What’s the best that could happen?”

Then the committee will balance its estimate of the risks with the costs, like a guy who is late for work and has to guess how fast he can speed down a heavily patrolled highway without getting pulled over.

The Fed’s rate-setting Open Market Committee has two main tools. One is its ability to change short-term interest rates, and the other is the statement the committee issues after each meeting. Either tool can move markets, by design or not.

Committee members have telegraphed their intention to leave rates alone, so they already stashed that hammer in its toolbox. Any suspense over the meeting will hang over the Fed’s statement, in which it explains its action and appraises the economy.

The Fed altered the format of its statements in May. The change was subtle and important. Before May, the committee gauged the “balance of risks with respect to the prospects for its long-run goals of price stability and sustainable economic growth.” That implied a tradeoff — you could have high inflation and high economic growth, or low inflation and low economic growth, or a compromise, with acceptable inflation and acceptable growth.

Since May, the Fed has assessed the risks independently. It looks at “the upside and downside risks to … sustainable growth” separately from the risk of inflation or deflation. It’s a more nuanced and realistic way of estimating tradeoffs. It’s like the difference between a guy who is running late for work and asks himself, “Should I break the speed limit or not?” and a guy who asks himself, “Should I speed, and if so, how fast, given the probability that I will be pulled over, the possible amount of the fine, and the likelihood that my boss won’t even notice if I get to work a few minutes late?”

He can’t know the answers for sure, but he can take educated guesses.

At a speech two weeks ago in Jackson Hole, Wyo., the Fed’s chairman, Alan Greenspan, said, “Uncertainty is not just an important feature of the monetary policy landscape; it is the defining characteristic of that landscape.” The Fed is just like that guy who is late for work, wondering how far to press the gas pedal, when to slam the brakes and when to coast.

Greenspan went on to say that the Fed decided to look at the risks of inflation separately from the risks to economic growth because the perils aren’t always the same. In fact, he added, they aren’t always known.

The Fed’s big worry is that deflation will take hold of the economy. That would be catastrophic. By considering the risks of inflation and economic growth separately, the Fed gives itself more leeway to prevent deflation or any other economic peril. Right now, this means that the Fed can justify keeping short-term interest rates low for a good, long time, even if the economy begins to grow rapidly.

“In the past, significantly tighter economic policy often came shortly after the beginning of a cyclical pickup in economic growth,” said Ben Bernanke, a member of the rate-setting committee, in a speech Sept. 4. In other words, the Fed was quick to raise rates as soon as it spied an improvement in the economy.

But that’s not the case anymore, Bernanke said, because the Fed now evaluates the risks of inflation and economic growth separately. “I believe that increased economic growth may not elicit the same response from the Fed that it has sometimes elicited in the past,” Bernanke said.

“It’s pretty clear that they’re trying to convey no urgency in raising rates, particularly with the Bernanke speech,” says Richard DeKaser, chief economist for National City Corp.

In fact, Bernanke held out the possibility that the Fed could cut rates again before raising them (but not at this meeting). Right now the federal funds rate, also known as the overnight rate, is 1 percent. The prime rate is 4 percent. Some consumer rates, such as those for home equity loans, home equity lines of credit, and credit cards, are pegged to the prime rate.

One thing to watch for when the Fed releases its statement is whether it mentions the titanic federal budget deficit. This fiscal year, the deficit is expected to exceed $500 billion, and that doesn’t include President Bush’s $87 billion request to pay for the occupation of Iraq and Afghanistan.

“It’s hard to think of the economy without thinking about this very expensive war and thinking about inflation,” says Diane Saatchi, president of Dayton-Halstead Realty in New York. If the deficits cause mortgage rates to rise, they could choke off the real-estate market that has buoyed the economy for the past two years, she worries.

But members of the Fed’s rate-setting committee are confident they can handle inflation. It’s deflation and the lousy job market that they’re more worried about.