Ouch! Americans Feel the Pain With the Obama Payroll Tax Hike

Millions noticing paychecks lighter today, due to payroll tax hike

The average tax increase for American workers is $700 a month thanks to the bill Obama just signed into law.
Yahoo reported:

Americans are beginning to feel the pinch from Washington’s decision to embrace austerity measures aimed at bringing down the nation’s budget deficit.

Paychecks across the country have shrunk over the last week due to higher federal tax rates, and workers are already cutting back on spending, which will drag on the economy this year.

In Warren, Rhode Island, Ben DeCastro got his first paycheck on Friday in which taxes on his wages rose by 2 percentage points. That works out to about $30 a week.

“You sit back and do the calculation, and that’s $30 I’m not going to spend at a restaurant,” said DeCastro.

He said he worries that people hit by higher taxes will spend less at the chain of furniture stores where he works as a marketing manager.

Politicians in Washington made much hubbub last week about a bipartisan deal to soften or postpone some $600 billion in scheduled tax hikes and government spending cuts. President Barack Obama said the deal would shield 98 percent of Americans from a middle-class tax hike.

Nevertheless, for most workers, rich and poor alike, taxes went up on December 31 as a temporary payroll tax cut expired. That cut – a 2 percentage point reduction in a levy that funds Social Security – was put in place two years ago to help the economy, which was still smarting from the 2007-09 recession.

About 160 million workers pay this tax, and the increase will cost the average worker about $700 a year, according to the Tax Policy Center, a Washington think tank.

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  • Luddite

    The payroll tax cut should have never happened. Medicare and Social Security are in trouble because people are not paying enough into the so called trust funds.

  • cecile dildine

    Please read the text it is 700 per YEAR….

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  • Kate

    A loss of 700 per year would hit our house hard. That’s alot of money for many people. Hope all the Obama voters are happy.

  • “President Barack Obama said the deal would shield 98 percent of Americans from a middle-class tax hike.” He lied, once again. Why does anyone on the left still believe anything this man says? More suffering to come…..

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  • Good. Ignorance should have consequences. These children actually believe everything from government is “free” or will be paid for by the “rich”. Time to grow the hell up people! Consider this a relatively inexpensive lesson, that is if you’re adult enough to heed it. Oh, and if you think this is end of tax hikes, think again. Everyone knows the money is in the middle class.

    But why do I waste my time writing this? Obama will blame Republicans, media will carry the message and the dolts will lap it up. Wash, rinse, repeat.

  • shadow

    A loss of 700 per year would hit our house hard. That’s alot of money for many people. Hope all the Obama voters are happy.

    Since that “increase” would have happened regardless of who was elected, and Obama was responsible for the temporary cut in the first place, this provides no reason for an Obama voter to dissatisfied, no matter how hard Jim tries to push this storyline.

  • Sasja

    Those of us who were paying attention knew better than to spend that money. We understood that was a reduction in FICA and that it would eventually go back up to where it should be. So we just socked it away and did not change our spending habits. So, I don’t feel sorry for those idiots.

  • Kate

    I think that’s called delusional. If you believe the tax increases aren’t the work of Obama, you are truly one of the lemmings. It is only going to get worse and the middle class and poor are going to have a rough way to go.

  • Formerly known as Skeptic

    The thing I noticed in this story is the first line. They actually portray Washington making YOU get by with less money as “Washington’s decision to embrace austerity measures…” Don’t get me wrong, I don’t think the payroll tax cut was a good idea in the first place and letting it expire is the right thing to do, but the “up is down” Orwellianism of that statement just blew me away.

  • Objective Analysis

    @shadow: You obama trolls are so into your propaganda that you do not understand the obvious. Obama is a Marxist/Fascist/Socialist/Statist/Communist. He despises the American Capitalist system and U.S. Constitution.

    His goal is fundamental transformation the USA to what exist in Saudia Arabia and India. Rich, poor and NO MIDDLE CLASS. Unfortunately, the middle class is what makes america great. small business comprise 87% of the business that generate wealth (not big corporations). These taxes are COSTS. Businesses goal is to minimize costs and maximize profits (sales) to exist and continue. Obama and his supporters despise wealth creation for those who are not rich. That is why he hates America. He is an overseer for a bigger purpose to create a New World Government where we are all slaves.

    Enjoy serfdom.

  • Thom99

    So it’s okay to tax those nasty rich people but not the regular folks right? The problem is people shouting the loudest to tax the rich where blinded by comrade Obama’s “promise” to “only tax the rich.”

    There’s a reason the phrase, “tax and spend” and the word “liberal” are SYNONYMOUS.

    Enjoy your pay-cut!!


    Yet these dismayed people will never connect the fact that the media lied to them, that the DNC lied to them.

    Worse, the feckless GOP will do or say nothing.

  • All of this after Obama just gave Congress a big raise. I wonder if the welfare queens checks were cut by the same per centage. NOT!!!

  • Karen Wong

    Just an FYI. Your headline says $700 a MONTH, and actually it’s $700 a YEAR.

  • Despiser

    If these turds at Yahoo consider this BS “Austerity” then they cant add 2+2…

  • Flintstone F.


    Thanks for demonstrating your math skills by putting “increase” in quotation marks.

    Obama gave us the payroll tax “holiday” (I can add) because he knew Americans were struggling. So, if that is the case why didn’t he in his ultimate wisdom make the “holiday” a “permanent vacation?”

    Liberals are just plain dumb.

    By the way, Obama spends beyond our tax capacity. I don’t suppose a liberal has the wherewithal to understand what that implies.

  • Flintstone F.

    But maybe you think minting a trillion dollar coin is genius idea.

  • Sasja

    If the progs were really serious about taxing the rich, they would start by taxing the asset rich; meaning themselves. They have their wealth and no amount of income tax increases are going to touch that. Same with the Hollyweird types. They were once again given a break so they will not be enjoying the benefits of having “skin in the game.” Buffet pays a lower percentage (by the way, he still hasn’t paid on his back taxes as yet; preferring to fight the IRS) because he does not pay himself as much as he does his secretary.

    Now for those rich who feel they are not paying enough, just write a check to the US Treasury. Of course they won’t. They only spout the lie they aren’t paying enough to keep from being a target by the perpetually envious and greedy.

  • NavySeal

    #8 shadow
    I hope I meet up with you face to face one of these days… I literally can’t stand people like you.. You know nothing about what you’re talking about.. Jim is pointing out facts you ignorant POS!! We’ll see what your views are in a couple of months when the market crashes & the government spends us into a great depression… Their not going to be able to buy us out of this one you fu*king RETARD!!!!!

  • YourMaster

    hope the lower and middle class like their huge tax hike…

    it will get worse… wait til about a yr from now heeheehee…

  • jony101

    the obama voters the majority who dont work wont feel a thing. there welfare check isnt taxed.They are the only ones who are ahead and laughing at us while they gorge themselves with unlimited foodstamp food.

  • Look-Out

    The president has positioned himself as a “warrior for the middle class,” fighting against a ruling class of one-percenters. But a new book says Obama is really at war with middle America.

    In fact, Obama hates the American middle class and all it represents, according to “Spreading the Wealth” by Stanley Kurtz. The president is secretly scheming to destroy it where it lives: the suburbs.


  • Blacque Jacques Shellacque

    …this provides no reason for an Obama voter to dissatisfied,…

    After having been bombarded nonstop by media shrieking about the”fiscal cliff” up until the deal was made, a rational person, not to mention someone with even a modicum of intelligence, would certainly not have considered the decrease in the amount of their paycheck some sort of nasty and unexpected surprise.

    A rational person would have no reason for dissatisfaction, but then such a person would have been unlikely to vote for Obie.

  • Schaenfreude


    New York Times and Time magazine falling victim to Obama economy an their own poor-quality work product.

    #24 January 12, 2013 at 12:36 pm
    Look-Out commented:

    His bad policies have already destroyed the black middle class. Now he’s out for the rest of us.

  • Look-Out

    Whether it is benefits for the underclass or more power for public sector unions, Obama is intent on cementing power based on the loyal support of the underclass and unionized labor. But to complete the task, he must deceive the middle classes for a bit longer by appearing to move to the center. The independent middle class voter, the very class of citizen that is most endangered by his presidency, is key to his reelection. In order to win reelection, he convince them he is safe.

    But nothing Obama has done has benefited the middle class. That much should be clear just from what is happening with consumers’ pocketbooks.


  • Look-Out

    Good point, Valerie…

    His bad policies have already destroyed the black middle class. Now he’s out for the rest of us.

  • Thom99
  • Look-Out

    One more for thought:

    President Barack Obama is a unique breed of socialist. He is a hybrid socialist/fascist. He understands that he needs “cover” to destroy America. He needs the support of famous billionaires like Warren Buffett and credible fat cat corporate CEOs like Jeffrey Immelt of GE to convince the masses that he is not out to destroy capitalism. He needs to show that rich people are on his side, that these rich guys agree with him that tax increases on the rich are “fair.”

    And the rich fat cats of big business will be glad to help him, as long as they share in the spoils. They’ll be glad to pay an extra $100,000 a year in taxes as long as long as Obama spreads the wealth around – to them. As long as he hands them billion-dollar tax credits, stimulus, bailouts, government contracts, corporate welfare and loopholes big enough to drive an 18-wheeler through.

    That’s exactly what’s happening in America today. The super rich and the big corporations have teamed up with Obama and his socialist cabal to wipe out the middle class, upper middle class and small business. They’re doing it with taxes, rules, regulations and mandates. Obama claims they’re aimed at the rich, but in reality they are aimed squarely at the middle class, upper middle class and small business.

    Big business loves taxes, rules and regulations because they have the lobbyists and armies of lawyers and accountants to either avoid it, shelter it or deal with it all. But small business doesn’t. So the competition of big business gets put out of business.

    Obama, on the other hand, has many reasons for targeting small business. First, he knows that’s where the money is. That’s where he will get the bulk of his massive tax increases. There aren’t enough billionaires or $100 million men to pay for all of Obama’s plans. He needs trillions of dollars to create his cradle-to-grave welfare state.

    That’s where small business comes in. There are several million taxpayers in America who make $250,000 to $500,000 per year. Almost every one of them owns a business. I’m one of them. We are the target. These are the independent thinkers. These are the self-made capitalist evangelists. These are the stubborn, principled fiscal conservatives who despise Obama and his plans for equality, social justice and income redistribution. Small business makes up the heart of the resistance.

    Secondly, small-business owners fund Obama’s political opposition. We make most of the contributions that fund conservative candidates and causes. Small business will never sell out conservative fiscal principles. Never. So Obama is at war with small business. He can’t win without confiscating our money and getting us under his thumb.

    Besides, what does Obama care about a $250,000-per-year small-restaurant owner? That person is insignificant to him. But the CEO of a billion-dollar conglomerate is very significant to Obama. That company can write $100,000 or $1 million checks to Obama’s campaign or his inauguration or the Democratic National Committee or an Obama-supporting PAC. And that Fortune 500 company has teams of lawyers and lobbyists, all willing to write big fat checks.


  • Look-Out

    Toward the end of article linked at #30 – with more in between the two posts…

    It’s all part of the Andrew Cloward and Frances Fox Piven plan. Build an alliance with big business to fund your plan to overwhelm the system and socialize America.

    Obama’s big government, socialist agenda isn’t aimed at the super rich. That’s just a head fake to cover the truth. That’s just the propaganda he uses to sell his con game to the masses. Obama’s destructive agenda is aimed squarely at you: entrepreneurs, small-business owners and the middle class.

    Obama’s goal is to create two classes of Americans: the super rich (who support and contribute to Obama, who then rewards them with bribes, stimulus, bailouts and government contracts) and the poor (who loyally vote for Obama to receive the handouts they need to survive). In Obama’s view of America, the middle class and small business must be destroyed, and the poor must be kept in their place (that place is hopeless, helpless and dependent on him).

    The cat is out of the bag. The crony capitalists are in bed with the greatest fraud of all time: Obama, the crony socialist.

  • sablegsd

    “Washington’s decision to embrace austerity measures aimed at bringing down the nation’s budget deficit.”

    BS How can you print this crap?

  • does anybody know how many taxes there are that we have to pay? it seems like thousands.

    for all of you who love the idea of the politicans confiscating the income of the rich, after the politicans steal enough money from the rich people that they are no longer “rich” who will be the rich people then that politicans have go after?

  • shadow

    By the way, Obama spends beyond our tax capacity. I don’t suppose a liberal has the wherewithal to understand what that implies.

    Obama can’t spend a single dollar that the Republican controlled House doesn’t first approve. Sorry if that little fact blows a hole in your “Obama the profligate spender” meme.

  • Winston Wolfe

    Obama can’t spend a single dollar that the Republican controlled House doesn’t first approve.

    Oh, really. Do tell the last time Obama signed a budget passed by both houses of Congress.

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  • shadow

    Oh, really. Do tell the last time Obama signed a budget passed by both houses of Congress.

    “You keep using that word. I do not think it means what you think it means.”

    Budget resolution
    The United States House Committee on the Budget and the United States Senate Committee on the Budget then draft a budget resolution. Following the traditional calendar, both committees finalize their draft resolution by early April and submit it to their respective floors for consideration and adoption.

    A budget resolution is a concurrent resolution that binds Congress, but is not a law, and so does not require the President’s signature. The budget resolution serves as a blueprint for the actual appropriation process, and provides Congress with some control over the appropriations process. No new spending authority, however, is provided until appropriation bills are enacted.

  • Lim Lynn

    Socialist Democrat Commie loves to rename taxes to penalty fee for not getting insurance under ObamaCare and many other terms. Therefore, we be seeing a far more damage that will happen more in 2013.

  • Look-Out

    These are the games the Dems play:

    Tuesday marks the 1,350th day since the Senate passed a budget. The law requires Congress to pass a budget every year, on the grounds that Americans deserve to know how the government plans to spend the trillions of taxpayer dollars it collects, along with dollars it borrows at the taxpayers’ expense. But Majority Leader Harry Reid, who last allowed a budget through the Senate in April 2009, has ignored the law since then. [pssst: Harry’s a Dem]

    There’s no mystery why. The budget passed by large Democratic majorities in the first months of the Obama administration had hugely elevated levels of spending in it. By not passing a new spending plan since, Reid has in effect made those levels the new budgetary baseline. Congress has kept the government going with continuing resolutions based on the last budget signed into law.

    While Reid has forbidden action, the House has passed budgets as required. [no surprise: the House is in the hands of Republicans] Senate Democrats have been highly critical of those budgets, designed by House Budget Committee Chairman Paul Ryan. [remember him?] But under Reid’s leadership, Democrats have steadfastly refused to come up with a plan of their own.


    [bracketed words mine]

    And you KNOW Barry (or should that be Valerie..) told Harry how to play it.

  • Look-Out

    RE #39 —

    Read that middle BOLDED paragraph very slowly.

    And you’ll get what’s been going on.

    See how well that works for the commies?

    Barry’s lovin’ it.

  • Flintstone F.


    You didn’t actually respond to my statement. You just implied I’m not familiar with what should happen when it comes to federal spending limits.

    The federal government spends beyond our tax capacity, period. Not open for discussion.

    I could care less what the spineless brain dead Republicans did to go along with raising the debt ceiling. The fact that they raise the debt ceiling should indicate to you that they’re spending way too much. They out spend our tax capacity.

    Deal with it.

  • Flintstone F.