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"It's like having an ongoing fever that you would like to shake but just doesn't go away," Kleinhenz said. "That causes a backup in decision-making from consumers and businesses." Take Nino Rodriguez, who was already planning to cut back spending on gifts for his four children ages 3 to 21 by about 25 percent to $1,500 as he juggles stagnant wage gains with college tuition costs. Now, the Chicagoan plans to cut another $500 from the holiday budget because of uncertainty. In particular, he's concerned about having government aid checks suspended for teenage sons who have special needs. "The doomsday clock is just one second less than what it was before," said Rodriguez, who works in the hospitality business. "All this just heightens our awareness of spending." This isn't the first time that debt-and-spending stalemates have hurt shoppers' mood during the holidays. Last year, Americans worried about tense negotiations in Washington to resolve the fiscal cliff, a simultaneous increase in tax rates and a decrease in government spending. Congress and the White House reached a deal on Jan. 1 that prevented income taxes from rising for most households, but many store executives blamed the uncertainty for a slowdown in sales in December. In November 2012, sales were up 4.7 over the year ago period, but rose only 2.4 percent in December. And in August 2011 when there was market turmoil and political strife over raising the federal debt ceiling, consumer sentiment fell to a 31-year low, according to the Thomas Reuters/University of Michigan survey.
Jeff Landis of Chicago-based Montopoli Custom Clothiers recalls those days when business was quiet and he had to delay ordering fabric and call his wealthy customers. He said he's seeing the same scenario play out now. "This is a buzz kill," he said.
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