Black market economy and no one is saying anything

[matchewed]

So what are we talking about here anymore? What are you concerned with? Illegal immigrants who would not be eligible for social security anyway and wouldn't factor into any sort of imaginary retirement crisis? Or as you put it in your original post the percentage of unemployed who are actually earning money?

If it's the former it doesn't matter because it's not as if we run around giving illegal immigrants social security. If we introduce them into the US as residents or find some other compromise which affords them some rights and taxation then the issue is solved by taxing them.

If it's the latter we're talking about at most 12 million people. If they're not putting money into the system they're not receiving money later either. If, let's assume they've put money into the system, even if all of the 12 million unemployed never get standard employment and still some how start receiving social security we'd only be increasing the current pool of 58.3 million social security recipients by a little. It's not as if all the 12 million unemployed are 58 years old.

i am concerned about legal residence only.  i know illegals do not qualify for SS.

i am not concerned about anyone getting away with a crime.
people living in cash economy - i am concerned about their future.
i am concerned about what will happen to them when they need SS and they have not paid into it.
i am also concern, too, about whether or not this does come to be a crisis.  i do not know if it will.  i brought it up here only to get feedback.  perhaps people here do not see what i see because people they interact with are different.

again, very sorry that i can only go on what i see, but a lot of people are working off the grid and they have made it their way of life.  i have no data on how many.  all i'm saying is that i see it all around me.  i was surprised to see it outside of california - i thought it existed in california because of the illegal population.  when i saw it in maryland too, among legal residence, i began to wonder.

Okay so it's the latter; which if you assume our unemployment numbers are at least accurate to describe the "employable unemployed" we're still not adding a large amount of people to the social security at a time. In fact it's a very small percentage. That's till assuming that they qualify for SS as they need to have had employment for a number of years in order to qualify. If I never contribute to social security a day in my life and live under the table the entire time I'm not entitled to social security. My existence doesn't guarantee social security my working and contributing does.

Outline what crisis you foresee. How would these people generate a crisis?

[cashcrop]

  It may not be that great, but it exists.  Even in your vacation in Mexico scenario, what sort of slave willingly pays $1600 to get back to the plantation?
 

i never said conditions in the US were worse than in central america.

Huh, I think my interwebs is broken.   All that's showing on my screen is "waaaaaah!"   

sorry, i tried.    didn't know some browsers may not show red.

[cashcrop]

i had stated many times before stats were posted my words are based on observation alone so any one who has time can begin digging for stats could easily drown out someone who has no time for such. 

Oh, okay.   To me, it would seem that anyone who has the time to respond with 10+ posts in a thread also has the time to spend a couple of minutes actually looking into the facts to help determine if what they're asserting has any basis in reality.

i respect your opinion, but digging for reliable stats often does not take a "couple of minutes."

[cashcrop]

So what are we talking about here anymore? What are you concerned with? Illegal immigrants who would not be eligible for social security anyway and wouldn't factor into any sort of imaginary retirement crisis? Or as you put it in your original post the percentage of unemployed who are actually earning money?

If it's the former it doesn't matter because it's not as if we run around giving illegal immigrants social security. If we introduce them into the US as residents or find some other compromise which affords them some rights and taxation then the issue is solved by taxing them.

If it's the latter we're talking about at most 12 million people. If they're not putting money into the system they're not receiving money later either. If, let's assume they've put money into the system, even if all of the 12 million unemployed never get standard employment and still some how start receiving social security we'd only be increasing the current pool of 58.3 million social security recipients by a little. It's not as if all the 12 million unemployed are 58 years old.

i am concerned about legal residence only.  i know illegals do not qualify for SS.

i am not concerned about anyone getting away with a crime.
people living in cash economy - i am concerned about their future.
i am concerned about what will happen to them when they need SS and they have not paid into it.
i am also concern, too, about whether or not this does come to be a crisis.  i do not know if it will.  i brought it up here only to get feedback.  perhaps people here do not see what i see because people they interact with are different.

again, very sorry that i can only go on what i see, but a lot of people are working off the grid and they have made it their way of life.  i have no data on how many.  all i'm saying is that i see it all around me.  i was surprised to see it outside of california - i thought it existed in california because of the illegal population.  when i saw it in maryland too, among legal residence, i began to wonder.

Okay so it's the latter; which if you assume our unemployment numbers are at least accurate to describe the "employable unemployed" we're still not adding a large amount of people to the social security at a time. In fact it's a very small percentage. That's till assuming that they qualify for SS as they need to have had employment for a number of years in order to qualify. If I never contribute to social security a day in my life and live under the table the entire time I'm not entitled to social security. My existence doesn't guarantee social security my working and contributing does.

Outline what crisis you foresee. How would these people generate a crisis?

Outline what crisis you foresee:
because i think the numbers are growing the crisis would be that they have nothing to support them in old age and what would happen, a bail out?  just give them a break, forgive them?  i don't know.   again, just here for the conversation, not for anything scientific. 

probably should end the conversation.

i have nothing on it but what i see and it is just a concern of mine.  it was a private concern until this post. 

i won't post any more on this.   

thanks.

sorry if i offended anyone.

[matchewed]

Maybe the next time you just want to have a conversation about a topic just ask a question. In this case you have structured an argument that you yourself say you have no evidence other than your observations to support. Then when people have questioned this you've resorted to getting angry that people have questioned it instead of addressing the questions.

I don't see how anyone here could have been offended. You just seem to not have gotten the conversation you were expecting. When engaging with a group of internet peoples it will often be the case they are a diverse set of people who probably don't necessarily share your world view and certainly don't live in your specific world with your specific set of circumstances. This makes for very little head nodding unless you are trying to seek out a site which only jives to your worldview. Certainly there are some topics here that fall into that "head noddingness" around here; financial independence being the primary one. Outside of that we've got a pretty wide group of people who definitely do not see the world the same way.

Questioning your position is not a power struggle nor is it an attempt for me to prove whether I'm right or not. It is just questioning your position. I'd expect answers to the questions. My point on having more than just observation to back up opinions is not to make your opinion less valid. Your opinion is still just an opinion. But we (I mean everyone) have to be able to take facts and base our opinions on that. If we have an opinion with no facts then we have to understand that the world may not be the same all over and that our opinion based on pure observation may just not be correct and we have to try to remind ourselves not to identify too strongly with our opinion and be willing to change it. I personally struggle with this a great deal myself. It's why I move towards researching topics and asking questions. It's being skeptical which can come off assholish but it is not the intent.

[Jamesqf]

  It may not be that great, but it exists.  Even in your vacation in Mexico scenario, what sort of slave willingly pays $1600 to get back to the plantation?
 

i never said conditions in the US were worse than in central america.

No, you said that "they are america's slaves".  So I ask you again: what kind of slave pays money to get (back) to the plantation?

On the larger question, this underground or informal economy has been going on for a long, long, time.  Certainly since I started working (my first jobs were field work, paid in cash), and probably long before that.  So where's the crisis?

Indeed, you can find quite a bit of info showing that the underground economy is a net benefit to the economy as a whole. 

[cashcrop]

i've done a little research.  underground economy definitely has increased.  partly due to the recession.   no idea if people involved will find working underground a way of life and continue or after economy improves move above ground.  it seems there is no real incentive to move above ground for some, because if moving above mean taxes and reduced pay for the same work, they may not be able to afford a pay cut. 


http://www.usnews.com/news/blogs/rick-newman/2013/03/18/the-new-underground-economy

quote from link above:  Authorities in California say off-the-books transactions cost the state $6.5 billion in lost tax revenue every year.

fair amount of this 6.5B from illegal immigrant economic benefit i guess.  it seems a lot for hospitals and schools to be doing without.  6.5B every year.  so while they collect pay off books, they show up at the hospitals and schools on the books.  i wish i knew how that economic benefit was calculated especially in cases where the restaurant that hires legal residences goes out of business while the one that hires illegal immigrants thrives.  carry this example to auto repair, drywall, plumbing... etc.  i really would like to see that calculation. 


http://moneymorning.com/2013/04/29/what-americas-2-trillion-underground-economy-says-about-jobs/
this article has related links at the bottom. 

from above link: "The Internal Revenue Service estimated that the losses from unreported wages have grown from about $385 billion in 2006 to about $500 billion last year.

State governments lose another $50 billion to the overall underground economy.

That means the people who play by the rules are getting a raw deal.


here is a website seemingly dedicated to the idea of cash jobs:
http://livesafely.org/   



there are lots of articles and lots of stated numbers on the internet so i won't soak you in them.  my concern has always been - what if they work in underground economy forever and have no ss when they need it?  never mind that question, it won't be answered until today's internet generation start to retire.  i still think gov't has a responsibility to educate/warn people about the impacts of working underground and to focus that toward the younger folks.  it really is easier than ever to make a living underground.


Here is a comment I found on underground article - 100k is way high but i get what he is getting to:
Example – wife cleans two homes a day and husband moves four lawns a day = $100,000 a year in cash – no taxes. Additional benefits: food stamps, housing assistance, free school lunches. Weekends on fleat market for additional cash. Driving Escalates. What a country!

[matchewed]

there are lots of articles and lots of stated numbers on the internet so i won't soak you in them.  my concern has always been - what if they work in underground economy forever and have no ss when they need it?  never mind that question, it won't be answered until today's internet generation start to retire.

But we can start answering that question. Below bolded for emphasis.

So what are we talking about here anymore? What are you concerned with? Illegal immigrants who would not be eligible for social security anyway and wouldn't factor into any sort of imaginary retirement crisis? Or as you put it in your original post the percentage of unemployed who are actually earning money?

If it's the former it doesn't matter because it's not as if we run around giving illegal immigrants social security. If we introduce them into the US as residents or find some other compromise which affords them some rights and taxation then the issue is solved by taxing them.

If it's the latter we're talking about at most 12 million people. If they're not putting money into the system they're not receiving money later either. If, let's assume they've put money into the system, even if all of the 12 million unemployed never get standard employment and still some how start receiving social security we'd only be increasing the current pool of 58.3 million social security recipients by a little. It's not as if all the 12 million unemployed are 58 years old.

i am concerned about legal residence only.  i know illegals do not qualify for SS.

i am not concerned about anyone getting away with a crime.
people living in cash economy - i am concerned about their future.
i am concerned about what will happen to them when they need SS and they have not paid into it.
i am also concern, too, about whether or not this does come to be a crisis.  i do not know if it will.  i brought it up here only to get feedback.  perhaps people here do not see what i see because people they interact with are different.

again, very sorry that i can only go on what i see, but a lot of people are working off the grid and they have made it their way of life.  i have no data on how many.  all i'm saying is that i see it all around me.  i was surprised to see it outside of california - i thought it existed in california because of the illegal population.  when i saw it in maryland too, among legal residence, i began to wonder.

Okay so it's the latter; which if you assume our unemployment numbers are at least accurate to describe the "employable unemployed" we're still not adding a large amount of people to the social security at a time. In fact it's a very small percentage. That's till assuming that they qualify for SS as they need to have had employment for a number of years in order to qualify. If I never contribute to social security a day in my life and live under the table the entire time I'm not entitled to social security. My existence doesn't guarantee social security my working and contributing does.

Outline what crisis you foresee. How would these people generate a crisis?

This is nothing new, you might as well ask that same question every year for the last 100 years that Social Security has been available. The answer has almost always been the same. They become homeless or have saved up enough to be independent or sadly die.

Everything you've brought up in the articles except for the state figure I've already mentioned. I even provided a breakdown of how that loss of revenue is derived from the IRS. The vast majority of it is not from cash job people but undereporting from small businesses. Why are you not voicing concerns about that? Mountain or mole hill?

[ChrisLansing]

The IRS implemented a new rule or law that you have to pay taxes on any amount over $600 (or so) paid out to an independent contractor. This means I have to file a 1099 (or whatever the form is) if I pay more than $600 to a web designer or a lawn clipper, etc. This puts the burden on the customer instead of on the business person.

Ugh, that sounds horrible.  As a homeowner hiring someone to do work for me, how could I be expected to know whether or not he's filing as a company?  Even if I know he's not, how's a homeowner going to know to/how to file a 1099?  That's something businesses with actual accountants fail at.  It's an unreasonable burden to put it on average Joes.

Homeowners don't have to issue 1099's to independent contractors they hire - it's only businesses that need to do this.  Don't believe everything you read on the internet - even on this forum!

When I was a contractor most of my homeowner customers paid by check.    Most people don't pay a bill for several hundred dollars (or more) with cash.     Risky to cash the check and not report it as income.   

[acroy]

Bleh, what a mess we get into when we tax productivity!

All of this mess is easily avoided if income/productivity is not taxed at all.

[frugalnacho]

cashcrop sure has a lot of posts for someone so busy he can't be bothered to research his opinions.  very bold.



also lots of complainypants going on in here.

also fuck the irs.  id pay less if I could too.

[phred]

That will be a bit skewed as California has a great number of undocumented workers due to the proximity to Mexico.

You forget that these people do still provide an economic benefit. They have to do something with their money.

The ones I know send most of the money they earn back to their homeland.  So, we are not getting the multiplier effect we would have if that money remained local

[matchewed]

That will be a bit skewed as California has a great number of undocumented workers due to the proximity to Mexico.

You forget that these people do still provide an economic benefit. They have to do something with their money.

The ones I know send most of the money they earn back to their homeland.  So, we are not getting the multiplier effect we would have if that money remained local

I'm sure they don't magically live on nothing. Sure they're not living in McMansions either but they have to buy stuff in the US. That being said the OP said they weren't as concerned with undocumented workers. Just citizens that are paid under the table.

[phred]

anyone think politicians aren't aware?
anyone think these people are going to end up old and having paid near nothing into social security and so they qualify for nothing?  another bailout coming in the future?

Politicians and others are aware, but are keeping quiet.  The more it's talked about, the more it gives ideas to Joe Average who starts thinking 'Hey, I could do that' and starts doing it.

Many in the underground economy ( a slight difference than Black Market) do have some regular, verifiable income as a cover.
Such traditional activities such as prostitution, loan-sharking, drug-running, smuggling, gambling have proven very difficult to stop, so I don't think putting more investigators to work is going to do much

[Erica/NWEdible]

I find the "oh, the poor underground workers, they'll have no social security!" argument a bit arrogant. People scrappy enough to dodge and weave around the normal economic systems probably don't need anyone holding their hands and doing their thinking for them.

[phred]

If you don't qualify for social security, you may still qualify for supplemental social security (ssi)

[Gwyidion]

It's worth pointing out that this is the paragraph which makes these claims:

Data from the IRS shows that total tax receipts from personal income dipped in 2009 and 2010, as would be expected in the aftermath of a tough recession. In 2011, the last year for which data is available, tax receipts rose by about 14 percent, as the economy recovered and more people went back to work. That's a healthy rebound, but some of that may have come, ironically, from government transfer payments, such as extended unemployment insurance, that temporarily boosted some people's income, On the whole, it's hard to tell if tax receipts are depressed as more people underreport their earnings.

Economists estimate the size of the underground economy at somewhere between 8 percent and 14 percent of total GPD, which could amount to as much as $2 trillion worth of economic activity. Authorities in California say off-the-books transactions cost the state $6.5 billion in lost tax revenue every year.

I have not edited it, removed any links or quotations. Sources are not included at the end of the article.

"Data from the IRS" is not cited nor linked. "Some of that may have come... from government transfer payments" - no evidence cited. "Economists estimate" - not cited. "Authorities in California" - not cited.

Laughable writing and analysis. Wouldn't pass a high-school requirement, much less anything worth having a 10-minute conversation about.

On the other hand, the author does manage to link or name-check books he is an author or co-author on four times, and link to his own article.