Simply, the January tax increases took away $165 billion in purchasing power but did not affect consumer behavior immediately -- thanks to the surge in year-end bonuses and dividends, and the normal lags in consumer behavior. Working- and middle-class families must keep driving to work and feeding their children -- now car dealers and shopping malls report slowing sales. Many upper-income families pay taxes on a quarterly basis, and the actual impact of the quite complex changes to the tax code and rates implemented in January were not reckoned until their accountants computed their first-quarter payments due April 15.
Monday, the Commerce Department reports consumer spending data for March. The consensus forecast is for a very-modest 0.1% increase, but with energy prices falling, that may translate into a somewhat larger bump to real spending. This report, along with Friday's jobs report, will provide the first and best indicators of whether the economy slowed significantly in March, and whether the "spring swoon" is the new hit tune economists sing this spring. Follow @PMorici1 This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.