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. Texas Coyote

    If anyone asks yet again, why the OCCUPIERS all over the United States are protesting. Listen up!
    “You control our world. You've poisoned the air we breathe, contaminated the water we drink, and copyrighted the food we eat. We fight in your wars, die for your causes, and sacrifice our freedoms to protect you. You've liquidated our savings, destroyed our middle class, and used our tax dollars to bailout your unending greed. We are slaves to your corporations, zombies to your airwaves, servants... to your decadence. You've stolen our elections, assassinated our leaders, and abolished our basic human rights as human beings. You own our property, shipped away our jobs, and shredded our unions. You've profited off of disaster, destabilized our currencies, and raised our cost of living(while lowering our wages). You've monopolized our freedom, stripped away our education, and have almost extinguished our flame. We are hit...we are bleeding... but we ain't got time to bleed. We will bring the giants to their knees and you will witness our revolution! WAKE UP AMERICA! SUPPORT OCCUPY!

    December 21, 2011 at 8:37 pm | Report abuse |
    • RabiaDiluvio

      no.
      You do not get a trophy for showing up and squatting in a public park to pout with a list of things you hate about the world and what "THEY" have supposedly done to make you a victim.
      Even after all this time I can ask 30 different occupiers what the message is and what they hope Occupy will accomplish and I will get 30 different answers: banks are bad...corporations are bad...capitalism is bad...special interests in politics (except for our special interests) are bad...french toast is bad...profit is bad...the "evil jews" are controlling everything....
      Until Occupy is united FOR one common cause, one banner idea that everyone can stand behind, it will continue to be a giant pout session, a joke and completely ineffectual.

      As for now, they most certainly do not represent me or my interests. To most of the world you ARE part of the 1%. Keep that in mind.

      December 21, 2011 at 9:06 pm | Report abuse |
    • Cenzo

      Kudos, my friend. I couldn't have said it better! Nothing short of revolution will stop the madness in D.C. The globalists have forced their agenda down the throats of citizens in the developed world, which will inevitably result in the decline in our standard of living, as now being witnessed. With finite resources on earth and the developing world wanting more of what Amerika has had, we will soon reach a tipping point. I want nothing less than to see these treasonous freaks hand from a noose when all is said and done. They have gutted this once-great nation.

      December 21, 2011 at 9:21 pm | Report abuse |
  2. trex

    .........$40 a week are 40 MORE reasons to vote Obama.................

    December 21, 2011 at 8:37 pm | Report abuse |
  3. Clifford Thompson

    Personally, I really don't care about the $40 if we can't expect it in the long run so I might as well not have it now. Anyhow, why does Congress have to earmark resolutions. All this accomplishes is fighting about controversial topics alongside common sense resolutions. In this case, both sides of the aisle want to extend the tax cuts but do not agree on the stupid pipeline. What does the stupid pipeline have to do with Tax Cuts. Nothing. If a resolution can't stand on its own weight than it shouldn't be passed. Stop holding the country hostage, STOP with the earmarks and lets get to business. Please...

    December 21, 2011 at 8:38 pm | Report abuse |
  4. Sherri

    $40.00 is half of my grocery bill every week.

    December 21, 2011 at 8:42 pm | Report abuse |
  5. Brittany

    You want to talk about spending. Lets talk about all the money we spent on the war. ENOUGH SAID!. Raising taxes on the rich is not transfering money to the poor. The low and middle class pay taxes just not as much as the rich because we cannot afford what rich people can pay obviously.

    December 21, 2011 at 8:42 pm | Report abuse |
    • Timickus

      Fire Congress and lets start over!

      December 21, 2011 at 9:25 pm | Report abuse |
  6. Dave

    Love the comment "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."

    Well, I don't have cable, get high speed internet free at my apartment's library, don't have a cell phone contract, drink instant instead of Starbucks, haven't seen a salary increase in years and pay well over $40 a week for gas just to get to work. I came into the workforce in the earlier '80s recessions and still feel the effect cast on my lifetime earnings almost 30 years later. Merry Christmas to every one in Washington that left the American Worker with coal in the stocking!

    December 21, 2011 at 8:45 pm | Report abuse |
    • LALALand

      I know that made me laugh. My work pays my cell phone. I sleep on a friends couch (so I use their internet and cable). And I still can't afford the basic studio apartment here where I am. And by basic here in LA– that means a studio with no kitchen (and sometimes a shared bathroom with other people). I remember when they started this years ago - I used to save that "extra" money for just in case. Those times have come and gone – and I needed that just in case last year when I was not working.

      December 21, 2011 at 9:06 pm | Report abuse |
  7. LALALand

    I work hard for my money. I work salary and my hours can vary from 10 hours to 18 hours a day. I can not get a second job -when I am not at work – say driving home or on the weekends – I am on call.
    Even though I am salary – it is not enough to even cover rent where I live and I have been sleeping on a friends couch for over a year. I sold my car to help with gas (I did get another used car that was better on gas mileage) and before you start – I can not just not have car. With the hours I work most of the time the buses are not running when I start or leave work. Though 40/check or how ever it works out is not a lot – right now for me (as a lot of us) it is A LOT of money.
    Some of you are on are rude and judge those who think that this is a lot of money - for me it means at least another 6 to 9 months (or more) of sleeping on a friends couch because now I will have to save less for a place of my own.

    December 21, 2011 at 8:49 pm | Report abuse |
  8. jordan

    Never Vote for the GOP.They do not care about anyone in the middle class or anyone who is poor.And they do not care about those who will lose unemployment in the wintertime.

    December 21, 2011 at 8:51 pm | Report abuse |
  9. b

    you've just been bought for $40.

    December 21, 2011 at 8:55 pm | Report abuse |
  10. Wyoming Cowyboy

    No matter what you make, you can always save. If the tax was higher a few years ago, people would of been talking about the money they would be losing was their savings money off of a paycheck. If your losing $40, that means that your not going to put money aside for emergencies? This is why our economy is the way it is, because when the government cracks down, than people resort to plastic, not paper, and start charging, and in turn get into debt, thus going against the governments efforts to stimulate the economy. No matter what money you make, what debt you are in, no matter how much Uncle Sam comes down on you, there is always a way to save.

    December 21, 2011 at 8:55 pm | Report abuse |
  11. Erica

    I think the other big thing law makers need to remember is that even if you're not on the verge of poverty that is 40 dollars you won't be fueling the economy with. Time and again it's been proven that pumping money into the market through consumer spending does big things. Cutting this 40 per person per paycheck will only be reflected back into the house and job market. We are just starting to see the end, why kill the progress we've made now? If nothing else, they should be giving some nice tax returns. People will be back out spending like Christmas all over again!

    December 21, 2011 at 8:56 pm | Report abuse |
  12. jusmisdit

    where on earth did the $40 figure come from? for this whole deal to mean a net loss of $40 a week a single person would have to be grossing 2k or a married couple who both work would need to gross 1k each to get to the $40 either way if you're making that kind of money it really shouldn't make you or break you.

    December 21, 2011 at 9:02 pm | Report abuse |
  13. Stephanie

    HEY GARY!!!
    I have gone without cable my entire life. I have the cheapest cell phone plan I can find, and do not use a land line....I use the internet at work, and I bring my own lunch. $40 per paycheck pays for the gas it takes me to get to that job.

    Get off your high horse.

    We are paying Congress to do a job. That job is to work together to craft meaningful legislation, and give every American the best chance they can have at working hard and succeeding in life. Instead, they spend all their time bickering, posturing, and planning for their next campaign.

    December 21, 2011 at 9:04 pm | Report abuse |
  14. Aida

    The day that the people expects (like now) that the Govement pays for our expenses and not to focus in what this country requires, we will become as any other third world country in the world, and believe me you MUST live it to understand how terrible that can be. Good for the Republicans. Cut your cable and your Internet if is necessary. I know that is hard but not that much as the other scenery for everybody. People do not realized what is important when you always have it for granted and the real cost of learn it is scary.

    December 21, 2011 at 9:11 pm | Report abuse |
  15. b

    This is pretty sad, that this is what is has come to. For $19.23 per week, we are willing to accept the worst representation in our history and be happy with it. Congratulations, Minions, you are being bought for a paltry $19.23/week. Me? I'm holding out for more.

    December 21, 2011 at 9:13 pm | Report abuse |
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