Underground Economy Essay Example for Free

Underground Economy Essay Every year, economics becomes a hot-button issue for politicians and ordinary citizens across the country. Politicians stake their careers on promises of economic revitalization, and individuals grouse when the forecast for the national economy is less than inspiring. Most economists measure an economy’s health by a variety of factors, such as the Gross Domestic Product, tax returns, poverty rates, and unemployment rates (Koopmans 575). But how accurate are these numbers? And if they are not accurate, then is society receiving a truthful picture of the overall economy? Many scholars stimate that as much as twenty percent of the GDP goes unreported every year (Kacapyr 30-31). In addition, surveys confirm that up to 25 million Americans are leaving large portions of income out of their tax files (Bartlett, â€Å"Going Underground†). In fact, the IRS estimates that an astounding one trillion dollars of income is left out of tax documents every year (Speer 15). Many factors contribute to this disturbing trend, such as crime and questionable business practices. However, one hot-button issue in particular has emerged as a significant factor in underground economy activity. For Texans, illegal mmigration is a little-disputed reality. For the American economy, Texas is an undeniable omen of the devastating impact of the underground economy. The term bears many other names (including informal and shadow economy), and has been defined in numerous ways, including those economic activities that circumvent or evade . . . the tax code and â€Å"unmeasured economic activity† (Priest 2259). The last definition, in its simplicity, best defines the underground economy. When many people think of unreported earnings, they may picture traditional illegal activities such as drug smuggling, prostitution, and gambling. While such activities do comprise a large part of the underground economy, millions of ordinary and otherwise law-abiding citizens participate in the underground economy every day. A 1994 auditor’s report states that, â€Å"The underground economy is not all smugglers. It is hundreds of thousands of otherwise honest people who have withdrawn their consent to be governed, who have lost faith in government (Dawson 18). For example, general laborers who are paid ‘under the table’ are for the most part honest individuals that nevertheless make up the estimated ? of Americans who earn â€Å"unofficial income† each year (Bartlett, â€Å"Going Underground†). What are the reasons for this illicit activity, and what effect does the underground economy exert on the overall economy? One major aid to the underground economy according to most experts is tax laws. Supply-side economics holds that any changes in marginal tax rates will have an important effect on resource use (Gwartney and Stroup 114). In other words, the presence of taxes greatly impact the economic decisions of businesses and employers alike. A big benefit for underground employees is the absence of income tax and social security reductions. In the underground economy, gross income and net income are equal. Employers also avoid costly payroll taxes when they engage in underground activities (Sennholz, â€Å"The Underground Economy†). Data gathered from the Census Bureau seems to confirm the prominence of tax evasion. The group estimates a twenty-five percent non-response rate for questions relating to income (Speer 15-16). Further, a Federal Reserve study found that when the tax burden increased by ten percent, underground activity rose by up to three percent. Self-employment and small business tax rises are particularly linked to underground economic expansion (â€Å"Underground Dwellers,† National Review). Another important determinant of underground participation is unemployment. Numerous studies have found a positive correlation between unemployment and underground participation. Individuals (especially those supporting families) who cannot find a well-paying job often feel that they have no other choice but to work in whatever job becomes available. Such citizens may work underground while still accumulating welfare and unemployment checks (Bajada 281-284). Surveys of inner-cities suggest that a gap does exist between the income reported to social welfare agencies (an average of $10,000/year in one California study) and the â€Å"actual† income level disclosed in confidential questionnaires (an average rise of $5,000/year in the California study). (Speer 16) Illegal aliens represent one prominent group who benefit from underground activities. Immigrants from poorer countries such as Mexico can be illegally paid under the minimum wage and still accumulate earnings significantly higher than if they found work in their home country. Such arrangements benefit both the employees and the employer (who avoids paying minimum wage and benefits) financially (Schlosberg 45- 47). The ramifications of underground economies on the economic picture are enormous. As previously mentioned, statistical data used to calculate the health of an economy can become irreparably skewed by missing underground information. Poverty rates and unemployment rates are overestimated (Bajada 181), which can present an overly bleak forecast for a state’s or country’s future (as evidenced by the American Demographics Index of Well-Being) (Kacapyr 31). In addition, small businesses and firms lose income opportunities because they are reluctant to move businesses into areas hich are deemed (perhaps falsely) as â€Å"poor† (Speer 16), resulting in a loss of revenue for affected regions. In return, the lack of legitimate businesses only stimulates the underground economy. National and state savings rates are also underestimated, which may lead to faulty focus in social welfare programs (Justice and Ng, â€Å"The Underground Labor Force is Rising†). Since these anti-poverty programs make up more than 70% of public aid programs (Paglin 2254), then it is vitally important that the facts and figures which are used to support and implement such programs are as accurate as possible. The programs that do work will lose important funding, due to tax shortfalls (Anderberg, Balestrino, and Galmarini 651). Likewise, the increased burden on taxpayers can create lower morale amongst even more otherwise law- abiding individuals (Bajada 187). For example, when the federal government is forced to raise taxes in order to fulfill missing income taxes, more citizens will become involved in underground activities in order to replenish their own incomes (Gwartney and Stroup 115-116). And the cycle continues. In the world of economics, there are no easy answers. Texas has learned this hard esson first-hand as its own underground economy thrives, largely due to a booming population of illegal immigrants. According to estimates by the Pew Hispanic Center, Texas-based illegal immigrants account for roughly ten percent (1. 6 million out of 11 million) of the overall United States illegal citizen population. Most of these undocumented citizens have settled in seven populous regions, including Houston (Combs, â€Å"Undocumented Immigrants in Texas†). Researchers project that the population of Texas will comprise of over fifty percent Hispanics by the year 2030 (Johnson, â€Å"Texas 2025). Of these fifty percent, a majority will enter the growing workforce of undocumented workers. Many of these undocumented workers arrive from the most education- and poverty-stricken regions of Central America and Mexico (Johnson, â€Å"Texas 2025†). Therefore, most illegal citizens, desperate for secrecy and any money for their disadvantaged families, accept jobs for little income and virtually no benefits. Despite a 1980s state mandate that banned companies from employing undocumented workers (â€Å"The Costs of Illegal Immigration to Texans† 7), Texas continues to be a prolific workplace for illegal immigrants. In addition to its proximity to the Mexican border, the heavy tourism and farming present in the state makes the region an attractive draw for the surplus of service, construction, and field jobs that constitute most undocumented employment. What are the ultimate effects of Texas’ booming undocumented, underground economy? Since the state does not focus on income taxes, most tax losses result from the disadvantaged economic situation most illegal immigrants encounter. Less income itself means less spending and therefore less sales tax—taxes which generate a large portion of state revenues (Bartlett 12). The greatest costs to the state economy, however, are accrued in public assistance. Just as state laws sought to punish employers for hiring illegal immigrants, the United States Supreme Court struck a blow to Texas’ immigrant control efforts by ruling that children of undocumented citizens must be allowed entrance into the public education system. Since this 1982 ruling, the state has spent roughly $7085 dollars per year on each student (including each undocumented student). If reports by the Texas Education Agency are accurate, the annual cost of schooling undocumented students is 957 million dollars (Combs, â€Å"Undocumented Immigrants in Texas†), nearly one billion dollars per year. Healthcare represents another crucial cost of the underground economy. Since virtually all undocumented workers receive no health insurance, these individuals must rely on public health services when they do fall ill or get into accidents. In Texas, most of these services are readily available to anyone—regardless of citizenship status—due to the Indigent Healthcare and Treatment Act. Emergency care, treatment of infectious diseases, immunizations, women’s and children’s health services, and even mental and substance abuse programs can all be obtained by illegal immigrants. The Texas comptroller conducted a comprehensive study at the end of 2006 which highlighted the extreme cost of such services per year. By applying a formula which measured state expenditures against the estimated undocumented population, the comptroller found costs of three and a half million dollars annually in emergency medicine alone. Federally mandated assistance services such as Medicaid netted an additional 38 million dollar cost per year in relation to illegal immigrants. Overall, the comptroller put total healthcare costs based on underground activity at a conservative 58 million dollars. Most of these expenses fall onto local governments and businesses in the private sector, as does the estimated 130 million dollars in annual illegal immigrant incarcerations every year (Combs, â€Å"Undocumented Immigrants in Texas†). The impact of illegal immigration on small business entrepreneurs perhaps highlights the most lasting cost to Texas’ future. A prevalence of underground economic activity steals from and slowly strangles the economy that is ‘above the ground. ’ Consider the plight of one contractor, a man who already charges at rates drastically reduced from those of his competitors. Despite his willingness to adjust to the economic climate and the spirit of capitalism, this legal worker—who compensates all of his employees fully—recently received a dismissal from a potential client that has become all too common: â€Å"I have two other bids here that are half what you’re asking† (McHugh, â€Å"Notes from the Underground Economy†). Documented workers, already struggling in a struggling economy, must face even more obstacles simply because they expect a living wage. The government has done little to address this problem. By the turn of the century, fewer than 1000 employers nationwide were being held accountable for hiring illegal immigrants. If this lax approach to the problem continues, in the United States and in Texas in particular, the dire prediction of Texas State Representative Pete Gallego will transform into a grim reality: â€Å"By the year 2025, if we keep doing what were doing now, Texas will have the economy of a Third World country. †

Budget :: essays papers

Budget To pass a budget deal takes a lot of time and work. There are many factors involved in this long process. The President first has to propose a plan to balance the budget. He has to look at the Federal deficit and talk with Congress. Congress then will negotiate or compromise a plan of their own with the President. In early March, President Bill Clinton began to put together a plan to balance the budget. He then gave Congress the plan to look over. At this time, congress criticized the plan, saying it would cost the country a bigger Federal deficit. Over the past three months, Congressional Leaders and the Clinton Administration have been doing a lot of compromising and negotiating over a plan to balance the federal budget by the year 2002. Since the Federal deficit isn’t that large, it is helping them to come up with a deal a lot easier and quicker. Although the fact that there is a low Federal deficit, they are still meeting some major complications in approving a plan or even coming up with a plan that can be agreed on. In order to balance the budget by 2002, the government would have to cut spending on things that really couldn’t afford it. The schools of the country need repairing. By cutting on the spending of schools, deteriorating schools would not receive the proper funding to make the schools safe and sanitary. Another item that spending would be cut from is Medicare, Medicaid, and social security. This would mainly affect the elderly and the poor. By cutting spending on these items, the elderly and the poor would not receive that much medical coverage, which is vital to them. Another factor which isn’t being very helpful in the budget deal is tax cuts. Democrats and Republicans cannot agree on where to cut taxes from. Democratic Congressional Leaders feel that President Clinton is having "secret" meetings with Republican Congressional Leaders on the budget plan. They feel that the President isn’t telling them everything and that these meetings are being held "behind their backs". Some even say that President Clinton is acting more like a republican than a democrat. Some evidence of this is that the President is proposing tax cuts for businesses, or the wealthy. They say that "ordinary and low income people are suffering the most.

Does Language Shape Culture?

Csecsei Luca 12. IB Does language shape culture? Most questions of whether and how language shapes thought start with the simple observation that languages differ from one another. And a lot! Just look at the way people talk, they might say. Certainly, speakers of different languages must attend to strikingly different aspects of the world just so they can use their language properly. The word order can be completely different among languages. And also there are tenses in some languages that we do not have, use or do not know what it really means. Such as the subjunctive in spanish language. It is a tense which is the hardest to learn while learning spanish, because such a tense that has so many meanings does not exist nor in hungarian, neither in english. I had the chance to spend a year in the U. K. and i also to take spanish there, i experinced that to learn this tense is just as hard for the english as it was for me when I learned spanish in my previous school, which was a spanish-hungarian bilingual school. Culture is learned, but taught through the language. Language is never the entity which has been invented in isolation. It certainly has evolved gradually with the continuous development of a culture. A culture being a building made of different beliefs in supernatural, social behaviors, human emotions, or way of expressing feelings, the language has continually adapted accordingly to accommodate these identified notion and gesture of human activity. Finding a symbolism every time to register it in the language, thus contributing to its growth. A language has always been a weapon to express one's ideas and feelings. And the reason enough to make this weapon more efficient to handle one's need of expressing things with intended accuracy. It has been tuned-up with each new finding, getting honed up continually to get its flawless shape with developing culture. Culture is determined by the language it uses with a great extent. The first thing that comes to my mind is always slang. Language clearly shows where people belong, if someone speaks really mincing his words that shows he is educated nd nor grown up on the streets like most of the people who use slang words and developed a whole new language between them. We are all members of a social group and members of `society? as a whole. People interact in many ways and communication is just about the most common and among the most important. Whatever is meaningful to a group, from their everyday life to their traditions constitutes their very own culture and is generally respec ted by all group members. Language is only one of such items. For ethnic minority groups that may have a language of their own, their language is a cornerstone in their culture. Take a look at dialects anywhere int he world. It clearly shows different customs, not just in language or communication. There a lots of dialects in South-America, for instance. Spanish in Latinamerica differs a lot from nations to nations, or we can also say, from culture to culture. There are dialects also in our country, Hungary. And people on the north of the country speak in a different way, like pronounce sounds so much different. Use words and expressions that we do not use at all. They also have differently built, constructed and decorated houses, songs, tales and wear different clothes as their costume. Taken together I do think linguistic processes are obtrusive in most fundamental domains of thought, unconsciously shaping us from the nuts and bolts of observation and perception to major life decisions. Language is central to our experience of being human and is central to our beliefs, and the languages we speak profoundly shape our culture.

Imaginary Maps By Mahasweta Devi And Heart Of Darkness

The darkest of hearts is the most ignorant and tormented. The human capability of being evil and hateful is undeniable. As a species, humans can be selfish, vicious creatures. For these reasonings the theories of good and evil exist to separate humans into two sub groups of personalities. As it seems, everyone is capable of evil, and everyone is capable of good. In the novel Imaginary Maps by Mahasweta Devi and Heart of Darkness by Joseph Conrad, the readers are thrust into colonized and post-colonization settings where indigenous groups are exploited for their resources and rejected for their cultures. Imaginary Maps author Mahasweta Devi is an outspoken activist on the care and treatment of natives in India. Imaginary Maps is a fascinating story which interconnects facts involving the treatment of natives and a fictitious plot and characters. Although a fiction, the story actively reviews the dos and don ts of being an activist. As well as a guideline, the book also gives insight i nto the divide between natives and what is considered â€Å"civilized† society. Imaginary Maps centers around journalist Puran as he delves into the tribal region of Pirtha and discovers the indigenous cultures and epidemic circumstances. Heart of Darkness is a classic novella following the protagonist, Marlow, as he journeys through the colonized Congo as a captain of a steam boat. Whilst on his journey, the reader gets a sense of the treatment and racism exhibited upon the native Congo people by