The current payroll tax hike will make families currently earning $50,000 a year earn at least $1,000 less, due to higher Social Security payouts that took effect in January, 2013.

It is no secret that Americans have been spending less money. Unemployment rates have gone up and that means more household scrimping. 

In order to get Americans spending again the government gave earning citizens a payroll holiday in December 2012. It was designed to help boost the economy, but now the holiday is over and Americans are being hit hard.

The payroll tax hike will send consumers and businesses into a vicious cycle.

Consumers are hit with higher taxes so they don't spend. If they don't spend companies, don't make money, causing them to drive up prices. The higher prices attack the everyday person's wallet, and the cycle starts all over again.

The most recent tax increase was the Social Security tax. Anybody who earns a paycheck pays into Social Security. In 2010, the tax was at 6.2%. The government lowered the rate to 4.2% in January of 2011.

However, in January 2013 the social security tax was raised back to 6.2%.

This means Americans will see more money taken out of their paychecks each time they get paid. Even those making minimum wage have to pay into Social Security, and will therefore also be earning less.

The United States' economy is still struggling, and at the end of March it is at risk for defaulting on its loans. The United States is currently 16 trillion dollars in debt, and the debt is continually growing.

In order to boost the economy, Americans need to spend money. But Americans are being forced to cut back on luxuries like eating out and taking a shopping trip because of the increase in taxes and the decrease in the amount of money in their wallets.

This disheartening cycle will continue until policy change can be made in Washington.