Attitude Check: Do the payroll tax cuts matter?
Adriene Hill: Now, it’s time for the Attitude Check. Every Thursday we touch base with the polling firm Gallup to find out what Americans are thinking about economic issues.
Today we thought we’d focus on the payroll tax cut, the most recent victim of Washington D.C.’s squabbling. If lawmakers can’t come to an agreement by the end of the year, taxes for working Americans will go up.
Frank Newport is Gallup’s editor-in-chief, and he’s with us now. Good morning Frank.
Frank Newport: Good morning.
Hill: What do we know about Americans’ support for the payroll tax cut?
Newport: You know, there hasn’t been a lot of polling on that recently, but there have been a couple of polls that have been done by the Associated Press and the National Journal over the last month or so. And both of them showed exactly the same thing: 58 percent said they supported the idea of extending the payroll tax cut, and about a third said they opposed it. So on available evidence, it looks like the American public would say yes to the idea of extending the payroll tax cut
Hill: And what about how people will spend that money, and its impact on the economy?
Newport: You know, that’s an excellent question — and economists disagree on that. We don’t have a lot of survey research — you know, what would you do with an extra $40 a week, and what have you. Economists debate; some of them say this will be great for the economy, some of them say it wouldn’t make much difference. We do know Americans actually on average think the amount of taxes they pay is about right, so I’m not sure it’s going to make a huge difference as far as the average American is concerned.
Hill: What’s the current fight in Washington, D.C. mean for consumer confidence?
Newport: It’s potentially very negative for consumer confidence. And the reason I say that is, back in August — July and August when we had the big debate over the debt ceiling — we saw consumer confidence drop almost 20 points on our Gallup measure. So we are predicting that it possibly could do the same thing right now — which is bad news, because consumers have actually been getting somewhat more positive. We’ve seen an upward slope on that, a positive slope.
We’ll wait and see, but based on what we’ve seen before, this may not be good for consumer confidence — which in turn, of course, wouldn’t be good for the economy.
Hill: Frank Newport is Gallup’s editor-in-chief. Thanks so much.
Newport: You bet.
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