Poll: Consumer spending hits two-year low

A new Gallup poll shows that lower- and middle-income Americans spent an average of $48 per day in September, a $16 drop since July and the lowest level since the organization began tracking the issue in January 2008.

For Americans earning less than $90,000 a year, consumer spending peaked at $105 in May 2008 and then declined to a daily average of $79 in December of that year. 

Since 2008, daily consumer spending for these wage earners has not risen above $64 for any month.

Consumer spending for Americans making more than $90,000 annually remained essentially flat in September, at $118, up $9 from August but virtually the same as June and July's figure. 

Consumer spending overall averaged $59 a day in September, down from $63 in August and $68 in July. September 2009 spending averaged $66. 

The poll suggests declines in spending might be a precursor to another significant drop in the overall economy. 

"Gallup's September spending and jobs data suggest that the possibility of a double-dip is no longer negligible," the poll states. "Congress needs to show the same urgency as the Fed concerning what it can do for jobs and the economy when it convenes in its planned lame-duck session after the mid-term elections."

When lawmakers return, they are expected to debate extending tax cuts enacted under President George W. Bush. 

Democratic leaders have vowed to extend the breaks benefiting the middle class while allowing relief for wealthier taxpayers to expire at the end of the year. 

Republicans and a number of rank-in-file Democrats think all of the tax cuts should be extended to keep the economy from backsliding into another recession. 

Some on Capitol Hill think the impasse will force lawmakers to extend all the tax cuts for at least two years. Others think the issue will carry over into next year, which would set up a situation in which taxpayers receive a rebate check for overpaying their taxes during the first few months of 2011. 

There is also talk that President Obama might sign an executive order requiring the Treasury adjust tax withholding tables to reflect an extension of the middle-class tax cuts. 

Many deem this plan extremely risky because it would force Congress to act accordingly, which could be a tall order if Republicans control at least one of the chambers, as many pollsters expect will happen after the midterm elections.