As lawmakers in Washington this weekend scramble to cobble together a last-minute compromise that will allow the country to avert a dive off the so-called fiscal cliff, many shoppers on Boulder's Twenty Ninth Street mall Saturday expressed little concern about the looming crisis.
"I think it's a media-manipulated game of fiscal chicken," 44-year-old Boulder resident Bob Schmidt said as he walked along the outdoor mall Saturday. "After eight-to-10 years of free spending, you've got to pay the piper somewhere.
"I'd rather suck it up over the next four years and get out of the hole than take a tax break and hope it goes away, which it won't."
The fiscal cliff refers to a set of deep cuts to national spending and large tax hikes on virtually all Americans that will automatically take effect unless the country's Democratic and Republican leaders can strike a deal before the new year to prevent them from kicking in. Many financial experts believe that if no deal is reached America could plunge into a recession.
The most immediate impacts of the cliff likely to be felt by the average taxpayer, as outlined in a study released earlier this year by Washington-based Tax Policy Institute, would come from a large number of tax cuts enacted in since 2001 expiring on Tuesday. For instance, a 2-percentage point payroll tax cut would lapse, raising taxes on more than 120 million working households, according to the study.
Daily Camera financial columnist Dave Gardner in a piece published on Dec. 2 noted that for taxpayers making more than $113,000 per year, that 2-percent tax increase could mean a more than $2,200 decrease in take-home pay next year.
Many Twenty Ninth Street shoppers on Saturday said they saw no reason to get overly excited about the tax hikes, but admitted the prospect of paying more taxes next year had spurred them to be more careful with their money.
"I'm just not spending frivolously. I'm investing wisely and I'm not panicking," 56-year-old Longmont resident Doreen Trees said, as she and her daughter, Kathryn, checked out some stores on the mall Saturday.
Trees said she has been following the fiscal cliff negotiations through the national media and alternative media such as the independent news program Democracy Now!, and feels its impacts have been exaggerated in many cases. Echoing sentiments expressed by Schmidt, Trees said she is not opposed to paying higher taxes if her money is being used responsibly by the federal government.
Niwot resident Greg Zwart, 52, said he has been following the negotiations. He said he has been disappointed in President Barack Obama, who he feels contradicted himself by saying he would reach across the aisle to work on a deal, despite already digging in his heels when it comes to raising taxes on upper income people.
Zwart, a contractor, said he, like Trees, has tried to eliminate frivolous spending because he knows for sure that he'll be paying higher taxes no mater what plays out with the negotiations.
"I'm just not buying anything exotic. Just getting back to basics," he said. "No lobsters for Christmas dinner. Not this year."
Quinn Trapp, 19, of Boulder, said he has not closely monitored the fiscal cliff negotiations but he has made efforts to limit his spending in light of the uncertainty surrounding the economy, efforts supported by the fact he hand-made all the Christmas gifts he gave out this year.
Trapp said he has focused on cutting back his everyday expenses. But the fiscal cliff won't stop him from investing the estimated $10,000 it will cost him to travel across Europe next year.
"I don't have all the money yet, but I'm not leaving for a while," he said.
Contact Camera Staff Writer Joe Rubino at 303-473-1328 or firstname.lastname@example.org.