Payroll tax cut standoff's impact: What $40 a paycheck means to you
December 22nd, 2011
09:53 AM ET

Payroll tax cut standoff's impact: What $40 a paycheck means to you

House Republicans on Tuesday rejected a Senate deal to temporarily extend the payroll tax holiday, leaving the White House and Congress at an impasse and creating a showdown between President Barack Obama and House Speaker John Boehner.

The tax cut is set to expire on December 31. Ending the tax break would cost the typical family about $1,000 a year, or $40 per bi-weekly paycheck for those who earn about $50,000 a year.

With frustration on both sides of the aisle, President Obama and the White House took to social media, hoping to get the public on their side in a public relations showdown with the Republican Party. The White House asked Americans what $40 means to them in an attempt to help put pressure on Republicans to pass the measure.

[tweet https://twitter.com/whitehouse/status/149237000522825729%5D

You responded in force on Twitter using the hashtag #40dollars.  President Obama said that the White House received more than 30,000 responses to their query.

That's perhaps why President Obama is expected to make a statement Thursday on the partisan standoff over how best to extend the expiring payroll tax cut, according to the White House. Obama will be joined by "Americans who would see their taxes go up if the House Republicans fail to act," the White House said. Some of those people have participated in Obama's social media campaign.

There was one surprise user of the hashtag: Speaker Boehner. But he used it to put things in his perspective, trying to explain why Republicans were right to try to work out a longer term deal.

[tweet https://twitter.com/SpeakerBoehner/status/149611555762343936%5D

[tweet https://twitter.com/SpeakerBoehner/status/149612691412107264%5D

So, with all of the bickering and the debating, we wanted to know if you agreed that $40 is a significant amount of money. We asked you if the end of the tax cut affect your family or if it would have little difference in your daily life. Here's what you said:

Selena Campbell is a 21-year-old from Orlando, Florida, who works in Admissions Control at Full Sail University. She said that the money she may be losing each paycheck would help buy new shoes for her husband. He has to walk to work every day because they can't afford a second car. But Campbell said that isn't the only thing it would help out with.

"For me and my family, $40 is $10 less than what we pay for groceries every week," she said. "There have been weeks, where we have only been able to spend $10 on groceries and have lived off of mac 'n' cheese and hot dogs."

Selena Campbell said the lost money would have helped with grocery and medical costs.

That money would also determine whether they could fully pay for their rent or car payments. It would also impact their healthcare, she said.

"$40 is what it costs for my medication so I can be a healthy wife, sister, daughter, mother," Campbell said. "$40 a month, in the economy we are in right now, is everything."

Tiffanie Young, a supervisor at a small rural hospital in Seaside, Oregon, says she saves $50 per paycheck for emergencies. The end to the payroll tax break would mean "I would probably have to stop doing that." She said that for a lot of people $40 could help pay for groceries, gas and other necessary bills.

But not everyone thought the delay would really impact them. And some people said they agreed with Republicans that a two-month extension wouldn't help.

Ryan Stoddard responded on Facebook that he felt just $40 a paycheck would mean "not much" to him and also agreed with House Speaker John Boehner that a short solution wouldn't help.

"Two months is a band-aid, not a solution," he said. "The Speaker is correct in his decision to call for more action."

Joel Jamison Bliss said on Facebook he was tired of seeing the story portrayed as "Republicans doing this to hurt the American people."

"A two-month extension does nothing and you know it ... this is another political ploy by Obama and more campaigning, which is all he has done for four years anyway," he said.

But Denise Mooren, a 36-year-old senior account who lives in Athens, Alabama, said her family would feel the hurt from the loss. Though it may seem like a small amount of money, Mooren said it is a "magical amount" in her household as she tries to make ends meet for her family of eight people.

"I pay $40 every two weeks for all the kids to buy their lunch, and I make them pack it the rest of the time," she said. "I had to purchase a Sam's Club membership just to make lunch items affordable for 15 lunches per week for three 11-year-olds, one 12-year old, and one 15-year-old."

She also said she needs that money for one of her children who has Attention Deficit Hyperactivity Disorder (ADHD)

"I pay $400 per month for insurance," she said. "The co-pays all went up double to $40 per visit. My daughter has to go at least 6 times per year."

One CNN reader, Jaimie, commented at how surprising it was to see people's bad finances and thought they were placing the blame on politicians.

"People need to learn how to budget, if you're seriously hurting for this $40 a month, you need to look at your finances," Jaimie said. "Don't blame the politicians for a lousy $40 a month. I support my wife and 2 kids off of one income and I make $30,000 a year, and we are never hurting. I set a budget and I keep it. Start a savings account for emergencies like these. Wake up people!!

Jennifer Alvich, a 36-year-old high school history teacher in Weehawken, New Jersey, said she is fed up with how politicians have handled many situations regarding her economic situation. The extra money she may not be getting each paycheck could pay for her bills, gas and groceries, Alvich told CNN

“I’m tired of reading about politicians who make decisions about the little money I have,” she said.

She said politicians are too focused on party lines and need to work together and stop hurting the middle class.

“This is about Americans getting through the year,” she said.

Melissa Matthews, a 32-year-old a stay-at-home-mom from Leander, Texas, said she works a job from home at night while her children are sleeping and her husband works two jobs.

Melissa Matthews is frustrated that the House has not passed an extension.

She said her husband just found out from his employer that he will be out $80 in January because of the standstill in Congress.

"They are messing with my family who can barely make ends meet," she said. "I am just very upset at the way the Republicans in the House are trying to manipulate this bill and get their way on other issues by threatening to take the payroll tax cut away. The extension needs to be passed and the other issues need to be worked out later. There is no more time to argue the issue. I appreciate the Senate passing the two-month extension and I want the House to do the same."

One commenter on our story, Gary, echoed a statement that many others made in response to some of the frustrations of possibly losing out on $40 a paycheck. He questioned whether everyone who was complaining was doing enough to live within their means.

"If this is a lot of money for you, cancel your cable bill and ditch your internet service. Get TV through the Air and internet at the library. I just saved you 120 bucks a month," he said. "Stop blaming the government for not helping you and look at what you can do to help yourself."

Frequent iReport contributor Egberto Willies says the payroll tax cut wouldn’t affect him personally because he works for himself as a software developer in Kingwood, Texas.

But he said everyone getting $40 could mean the difference between the “economy surviving or going back into a recession.”

Frequent iReporter Matt Sky, fromNew York, said the money would help in opening up the economy a little by allowing middle class American to pay off debt, car payments or buy groceries.

“The $40 bi-weekly would mean a lot for working class Americans," he said. "Wealthy folks, the tax breaks don’t really mean as much because they basically already have a lot money to meet their expenses."

Cindy Riley is a 54-year-old homemaker living in Center Point, Alabama. She said that $40 a paycheck for her family would help pay for several utilities or bills.

"$40 pays for our car insurance for a month. I can't cut that out, the law requires it. $40 pays for our water and sewer for two weeks. I can't cut that out either unless I want to start hauling water from the creek and build an outhouse," she said. "$40 will buy my vegetable garden seed for next spring. I suppose I could cut that out, but that would cost more in the long run, both in terms of health and just food.

"$40 pays for the Internet access for a month, and I suppose I could cut that out, but we have no other entertainment and I use it to pay all my bills and stay in touch with my family so that I can save the price of stamps. $40 pays for my pay-as-you-go phone for about four months. Can't cut that out, It's the only 'phone we have, we cancelled the landline long ago."

The money would also help with a new prescription she has to take, feeding her cats, health care for her family and the pets, or gas for her husband to get to work.

"We're about at the bottom of the barrel here," Riley said. "No, we've gone through the bottom of the barrel and it's really, really leaking."

We also put the question to our Twitter subscribers online, and you answered in force. Many of you said it could help with several small bills you had. Here's some of the responses you tweeted using the hashtag #40dollars about how much the money would or wouldn't help.

[tweet https://twitter.com/Krohn_DC/status/149857524248608769%5D

[tweet https://twitter.com/CAPRICECLASSIC5/status/149851340372320257%5D

[tweet https://twitter.com/AprilDlicious/status/149650391842304000%5D

[tweet https://twitter.com/SissonsTo/status/149257818250297344%5D

[tweet https://twitter.com/PtBrindley/status/149578268759175169%5D

[tweet https://twitter.com/WhySharksMatter/status/149856928653262849%5D

[tweet https://twitter.com/mattnocella/status/149240064432553984%5D

[tweet https://twitter.com/docstrangedub/status/149690011443412994%5D

What do you think? Would $40 impact you and your family, or would it barely impact you. Let us know by sounding off in a video on CNN iReport here. We'll be adding your thoughts throughout the day.

soundoff (1,741 Responses)
  1. newdrive

    $40 in the grand scheme of things means absolutely nothing. In real life, it may or may not help a poor person move ahead for maybe a day or it may or may not silence some bizarre political argumentative critics over where bigger money should be directed.

    I think the bigger picture or at least for today, is to say "OK, we accept this but overall we support our President & his platform"

    Lets show some support on the Worlds stage!

    December 21, 2011 at 6:30 pm | Report abuse |
    • Zen

      Help get ahead for a day? Are you kidding.........you should see the homeless people in Midtown ATL, GA. $40.00 could be very substantial for many folks.

      December 21, 2011 at 6:35 pm | Report abuse |
    • skarphace

      $40 per biweekly paycheck means $160 per month in lost OASDI revenue (considering both the employee and employer portions of the tax are cut). This is per worker making an annual salary of $52,000. This is indeed a significant cut in our future Social Security benefits.

      December 21, 2011 at 6:35 pm | Report abuse |
    • skarphace

      Zen: are you serious? How would a homeless person without a job get any money from this tax break? They wouldn't get a dime, since this is a cut in Payroll tax, and you need a payroll to get the cut. Understand now? This is not a cut that helps the poor. In fact, since it defunds Social Security, it could very well be argued that it hurts the poor.

      December 21, 2011 at 6:37 pm | Report abuse |
    • Sildenafil

      I'm sorry, but grand scheme of things? In the grand scheme of things in my house, after taking 2 pay cuts another $100 a month is enough to push me over the breaking point. If you don't want the tax break, send your money in yourself, I'm sure they will take it. Just don't even begin to think that just because to you it's a couple large mocha's or whatever and doesn't matter, that it's the same for anyone else.

      December 21, 2011 at 6:38 pm | Report abuse |
    • Reilleyfam

      No. It is a big deal for people on tight budgets. It's also the principle that they always approve tax cuts for the wealthy and businesses with no demand they be paid for elsewhere but for middleclass folks we get a different standard = unfair. It shows the GOP is not really anti tax – only for the rich & business. They are anti family, anti worker, anti consumer.

      December 21, 2011 at 6:39 pm | Report abuse |
    • El Chino

      FORTY BUCKS DON'T MEAN A HILL OF BEANS. TAKE IT AND STUFF IT.

      December 21, 2011 at 6:45 pm | Report abuse |
  2. Problem solved

    Stop bickering about rebublicans and democrats and vote for Ron Paul. He is truely Americas last hope. He is the only hope we have to climb out of this $40 stink we are in.

    RP2012

    December 21, 2011 at 6:30 pm | Report abuse |
    • Reilleyfam

      He's a comic strip. Lovable but utterly unfit to be the President. 30 years ago he would not even be allowed at the debate or on the ballot.

      December 21, 2011 at 6:41 pm | Report abuse |
  3. Gord

    R E V O L U T I O N !!!!!!!!!!!!!!!!!!!!!!!!!!!!

    The Arabs have the guts to openly fight their governments, why don't we?

    December 21, 2011 at 6:31 pm | Report abuse |
  4. Pauly

    Revolution!
    The arabs have the guts to openly fight their governments. Why don't we?

    December 21, 2011 at 6:32 pm | Report abuse |
  5. yonder

    What is 40 bucks when a cup of coffee is $4?

    December 21, 2011 at 6:34 pm | Report abuse |
    • Sildenafil

      It's nothing to someone who has $4 to spend on a cup of coffee. To those of us that have long since cut those little things out of our budget, $40 is groceries, electric bills, gas. But thanks for playing!

      December 21, 2011 at 6:43 pm | Report abuse |
  6. Dean88

    This is exactly why I am voting for Obama and voting against everybody else that is up for re-election.

    December 21, 2011 at 6:35 pm | Report abuse |
    • Zen

      Do it Dean...you got the right idea in mind! Those Repubs will implode as usual and as McCain inferred..it's going to cost the Repubs. How can you not address $40.00...or that's right the Repubs are sticking to theirs oaths...nothing changes and they do not want Obama to succeed. This has been their mantra since he was elected. How unpatriotic is that and it's not about Obama, it's about mainstreet...US.

      December 21, 2011 at 6:40 pm | Report abuse |
  7. Reilleyfam

    I used to take my family out to dinner every week, now it's once a month. If I lose the $40 it will be not at all.

    I used to live in a great country, now I wish I'd left when I turned 18.

    December 21, 2011 at 6:36 pm | Report abuse |
  8. suicide

    If $40 is really going to break your bank; suicide is a real option. Don't think about it, just leap out a window. Maybe drive your car off a bridge. It boils down to decisions, you have chosen to make crap decision after crap decision and now find yourself complaining over $40. Make a good decision for once. Suicide, your first best choice.

    December 21, 2011 at 6:37 pm | Report abuse |
    • Tracy

      Well if YOU are so weak minded,why don't YOU take the Jump instead?The rest of us will be busy figuring out how to HELP each other out of this mess.Suicide is for those who haven't yet learned it's ok to ask for help..Don't even go there my friend,I have had to live with the fallout of it for over 7 years.Quit being so arrogant&hateful&realize you need help yourself.makes all the difference..

      December 21, 2011 at 11:33 pm | Report abuse |
  9. richard

    I am a finance professional and 40 dollars barely buys two drinks at the upscale bars. 40 dollars every two weeks is nothing. Heck 40 dollars a day is nothing. If you want SS pay for it, otherwise STFU.

    December 21, 2011 at 6:37 pm | Report abuse |
    • Reilleyfam

      Glad you are such a wealthy 1%er that $40 a day is nothing to you. It's a daily food budget for most families.

      CUT THE TAX AND PAY FOR SS ELSEWHERE LIKE TAXING THE RICH.

      December 21, 2011 at 6:43 pm | Report abuse |
    • john

      @Reilleyfam
      get a real job and stop complaining, you are a punk

      December 21, 2011 at 6:45 pm | Report abuse |
  10. It Matters

    If $40 means little or nothing, then what is to stop another $40? Then maybe $20 here and there later? Yes, $40 matters because if we act like it's no big deal then it's an open invitation to keep on taking.

    December 21, 2011 at 6:39 pm | Report abuse |
    • yonder

      It does matter, but it is barely more than a handout.

      December 21, 2011 at 6:41 pm | Report abuse |
    • tom

      Is this what they call "trickling down"? We give billions to the banks and get $40 in return?

      December 21, 2011 at 6:42 pm | Report abuse |
    • maria

      American people, admit that you have been screwed over. All you got is empty slogans.

      December 21, 2011 at 6:46 pm | Report abuse |
  11. shak

    $40 means a full tank of gas which lasts for 2 weeks!

    December 21, 2011 at 6:39 pm | Report abuse |
  12. Jessica I

    $40 per pay can mean a lot to those who make hardly any money. However, the opinion of the common man doesn't mean a thing at this point. The government will do just about anything to take a penny or in this case way more from the people in order to make them more dependent upon them. If Congressmen, Senators and other "politicians" would agree to lower their salaries maybe we could all keep a little more of what we work so hard for. I may be alone in the thought that "politicians" get paid too much money and have way too many "perks" for sitting around doing nothing. I can guarantee that if I were to go to work and just sit there talking all day I would eventually get fired. Don't get me wrong, I don't believe that all government workers are crooks, but the majority give the minority a bad reputation!!!

    December 21, 2011 at 6:39 pm | Report abuse |
  13. richard

    Complaining about 40 dollars is a joke. If you are not making 50K then you are not paying the 40 dollars anyways. Try working harder and getting a real job. I work over 50 hours a week in finance to make 180k a year. you want more, study and get a better job. jobs are not randomly assigned, you get what you work for

    December 21, 2011 at 6:42 pm | Report abuse |
    • Sildenafil

      Glad to see your compassion shining through here. I've made around what you do – and I hated what I did. Instead I work doing something I love but the salary is considerably less. Now, stack inflation, the lack of pay increases in 3 years and in reality 2 small paycuts – $40 is enough to make a difference now.

      December 21, 2011 at 6:48 pm | Report abuse |
    • Reilleyfam

      YOU are exactly what is wrong with this nation. You should be burned at the stake by occupants.

      The willingness of the masses to adhere to the social contract, which provides the safety and freedom for all business to exist, is based on getting a fair share. How much will you make when they burn your business down and string you up? You only have a job because the mob agrees to it. What the mob giveth the mob can take away.

      Also, your comments in no way address the merits of the tax cut issue. YOU should go to school and learn how to analyze and respond to an argument.

      December 21, 2011 at 6:50 pm | Report abuse |
    • Successful pot smoker

      I agree with Richard. Work hard, study hard, earn money. I do not earn half of his salary, but I do better than most. How???? Hard work. If your job sucks, go to school for a new one.

      While in school, do try and study soemthing worthwhile. While scoring some weed the other day the college kid selling it tells me he is studying asian culture. Really?????? His long term goal must be selling pot, cause asian studies must be the most useless degree ever.

      December 21, 2011 at 6:51 pm | Report abuse |
  14. Dan

    $40 is my entire kids Christmas budget. Yes for real.

    December 21, 2011 at 6:42 pm | Report abuse |
    • john

      if you go to the dollar store you can get them 40 items

      December 21, 2011 at 6:49 pm | Report abuse |
    • Tracy

      I feel for you Dan.I am a Foster Mother(NO I don't get paid&NO they DON'T get perks,my state is too poor for that but I do it anyway out of Love for MY kids)I have 10 kids that I take care of&this year the only thing that will be under the tree is LINT.This is the 2nd Christmas that we have nothing,but my kids are working so hard to get their education&be good citizens.They once were gang bangers as young as 8 with NO Family left,we don't have much money but we do have family&faith.That doesn't mean a church,believe me,since most of my kids are what society calls minorities,the help margin is DIM,no matter WHAT people may believe,I'm out here in the trenches&have been for almost20 years.But my kids continue to amaze me,1 to west Point,many others a scholarship,&they EARNED it all.Now,they are all in Jeapordy with no redress in sight.How can we change things for the better when we are constantly held down?The only thing we will actually have is dinner&the heat on,which just means the 1 fishstick they get won't be completely cold when they sit down.The only thing we have left is the Love between us after all the financial Fiasco thats happened&I Guarontee ya,thatDOESN'T pay the bills!Best of luck to ya,I'll keep ya in my thoughts:)

      December 21, 2011 at 11:50 pm | Report abuse |
  15. Will Bar

    Fred Upton seems to be supporting the very thing that cause most Americans to complain. In his interview with CNN, the very first words out of his mouth were "Well you know this is the normal way that things are done." The American people are tired of the normal way that things are done!!!! Fred Upton also seems to me to be out of touch with struggling people with his comment regarding what to do with $40 per month. If $40 means that much to a family, then it is irresponsible to suggest a dinner out before putting a roof over their head or food on their own dinner table. I ask the question to Fred Upton and John Boehner, "Is it better to fail as individuals, or succeed as a team?" Fred, you seem to be holding the American people hostage in a high stakes poker game. This is NOT a game. DO YOUR JOB!!!!!!! OR GET OUT!!!!

    December 21, 2011 at 6:43 pm | Report abuse |
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65