Posted on 04/11/2010 7:46:58 PM PDT by 2ndDivisionVet
He plies his trade at Arden and Howe, one of the city's busiest corners. An advertising sign holder for hire, Trandell McCauley makes his money a couple hours a day or a week at a time.
And he earns it in cash.
McCauley calls his job a "backbone," the $10 an hour he earns keeping him standing in tough times.
He is part of the bustling underground economy, where folks are paid in cash and taxes aren't paid at all. State agencies don't keep precise, up-to-date statistics, but experts say the deep recession has made such shadow work a growth industry here.
Some of these people can't find other jobs; some choose to avoid paying taxes; some are undocumented immigrants who fear deportation. Others have employers who insist on hiring them under the table. Still others earn income through illegal activity.
As much as $2 trillion in income went unreported nationally in 2008 — about 24 percent of total adjusted gross income in the United States, said Edgar Feige, a University of Wisconsin economist and authority on the topic. That's the highest level since World War II, he said.
"It seems to be trending up," Feige said. "There's no indication of it changing course until the general economic situation improves. When more employment opportunities arise, that will reduce the level of underreporting and nonreporting."
For the cash-strapped state of California, the underground economy represents a major lost opportunity to help fill the estimated $18.6 billion budget deficit.
In 2005, the state Legislative Analyst's Office estimated the state was failing to collect about $6.5 billion in income taxes each year due to such cash transactions. Another $1.5 billion annually in sales taxes was also going unpaid, the agency estimated.(continued)
(Excerpt) Read more at mercurynews.com ...
And much of the money earned sent outside the United States.
For wiring money, Western Union no longer considers Mexico a foreign country.
This is just starting. There will be ‘Barter Co-ops’ springing up everywhere, accelerating with ‘Cap ‘n Trade’ and the expiration of the “Bush Tax Cuts”.
I like avoiding the taxes....a place where hard working wage earners will probably have to go to preserve any of thier income..
Put a fee on all money wired out of the country.
Since NAFTA, is it truly one? Is Canada?
What about the CA marijuana crop? How much of the production and distribution income is taxed?
This is one reason they’re coming up with the great idea for the VAT tax all of a sudden. Fewer “honest” jobs means less income tax feeding the beast via the normal channels.
Lets tax the people some more so this doesn’t get any worse! ROTFLMAO!!!!!!!!!!!!!!!!
Kinda like making all gun owners jump through more hoops. Yet the criminals just continue robbing and killing at will.
Edgar Feige, a University of Wisconsin economist and authority on the topic...
One of my Profs in undergrad and grad school - truly an expert. Great simply to see his quote.
The example of sign holding was looking promising if this article had the thesis - “doing the jobs americans won’t do”. But then again, I guess this feller is not an illegal alien. Quite a spectrum in Silicon valley - Steve Jobs on one end, sign holders (or is there something less?) on the other.
A necessary reaction to high taxes ... money moves underground to mattresses. It’s what happened during the depression... where banks were deemed unsafe.
well great, they can just raise taxes to make up for the lost revenue. That ought solve the problem. < / sarcasm>
The underground economy is obvious to anyone of average IQ.
Oh, forgot.
Duh.....Progressives.
Concur.
With yet more regulation and the imposition of a VAT, this also has the potential of being defined by the left as a “black market.”
The main problem I have with this, based on people I know who work “under the table” is that a large majority of them also get welfare benefits.
FWIW, I support the FairTax for similar reasons, but only with repeal of all federal income taxes.
When Reagan cut taxes and simplified the tax code, not only did tax revenues go up, but the black market economy shrank. The Cato Institute commented that the risk--reward tradeoff for getting caught was now too high.
The beatings will continue until moral improves.
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