The authors employ a creative research design to investigate the impact of income reductions on expenditures for the working, middle class over the course of the business cycle. They rely on the Child Tax Credit program to identify comparable treated and control populations and draw upon the Consumer Expenditure Survey to assess microeconomic household responses. The effect of the income reduction is negative and statistically significant; those that lose the credit reduce total expenditures during the recession on average by 13.3 percentage points compared to households still eligible. They find the largest negative effect on durables, house maintenance, tobacco, and child related goods expenditures; moreover, households decrease consumption on electronic and entertainment-related goods. While the economic costs of the Great Recession are likely still accumulating, an event like this presents an opportunity for scholars to examine economic theory.