Today was the first payday that many middle class Americans experienced the effects of the Obama payroll tax hikes. They saw a two percent reduction in their take home pay because of the Obama payroll tax hikes that went into effect as a result of the so-called fiscal cliff compromise.
Because President Obama failed to bring forward any meaningful spending cuts during the past four years, the federal government decided to raise taxes on 77% of Americans. Americans that receive a W-2 as payroll employees are seeing a 2% increase in their Social Security payroll taxes. That may not sound like a lot for some people but for folks at the lower end of the income scale, it is a meaningful cut in take home pay.
Many of the taxpayers I spoke to this morning were angry at President Obama because they had believed he was only going to raise taxes on the wealthy. They were surprised to find out that their payroll taxes went up as well. One woman I spoke with at a local government business said she may have to start looking for another job. Another taxpayer told me that she was incredulous that the President could raise taxes in an already struggling economy.
The Americans that are benefiting are those that are either retired or disabled, collecting unemployment, on welfare assistance, or who otherwise are not subject to payroll taxes.
This may be a precursor to growing animosity as working middle class Americans, and especially younger voters, begin to realize that they are being asked to pay for the expanding social safety net that is at the heart of the Democratic Party platform.
You may read more from Kevin at his common sense wisdom blog. His book, Discovering Possibility: A Common Sense Conservative Manifesto, is now available on Kindle. The working title for his upcoming book is, Discovering Possibility: The Revolution for Virtue and Common Sense. Kevin offers common sense community building coaching to grass roots groups around the country that are interested in pursuing common sense approaches to community building.
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