I took an interest in this topic after a recent visit at a local flea market. I noticed that some of the vendors at the market collected sales taxes while others did not when I made purchases. Some of the items I purchased were goods that could be purchased in stores where sales tax would have been charged. A friend of mine is a regular vendor at the flea market who provided some interesting details to many of the vendors he encounters each week. There are vendors who are on disability, others who are unemployed, and even seniors, all of whom are there for the same reason – to supplement their income. These vendors only work on a cash basis and many will not even place their earnings in the banking system as a way of avoiding any government agencies following them for collection of taxes.
According to BusinessDictionary.com, “black economy” is defined as “usually untraceable and hence untaxable, business dealings that are not reflected in the country’s gross domestic production (GDP) computations.” Further, “black economy and black money go hand in hand. Also called parallel economy, shadow economy or underground economy.” The recession conditions are causing many Americans who are unable to find full time work for decent wages or who are on unemployment to become a part of this underground economy.
THE NEW UNDERGROUND ECONOMY
U.S. News & World Report reported that “more people than ever may be working off the books and spending freely.” The economic downturn in the United States has resulted in millions of Americans who are either unemployed or underemployed. Many of those that are unemployed or underemployed possess skills and knowledge that are still marketable to many who are on tight budgets as wells, whether ...
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...By comparison, Europe’s underground economy is twice as large as the United States. Moreover, about one-third of the annual income of the entire world is unreported. There are many factors contributing to ever growing underground economy including high taxes, too much government regulation and even government corruption.
In conclusion, perhaps a solution for reducing the amount of those associated in the underground economy would be determine how to improve the economy itself. Increasing taxes or overburdening businesses with too much government regulation will not provide increased revenues to individuals and businesses. To the contrary, if there are reductions in taxes and regulations on businesses, companies would be in a better posture to hire more workers thus resulting in increased tax revenues as well as a much needed boost to our country’s economy.
If one were to take a look at the American business world today, much as if one were to look at it a hundred or more years ago, one fact would be easily noticeable. The majority of positions of power and authority in most American businesses are white males. In fact, white males outnumber all other races n these positions far more than they outnumber the actual populations of these other people in our country. Specifically, black men are sorely represented in executive positions in corporations and businesses across the board. So why is that? Is there some fundamental character of black people that keeps them from success? Is society still oppressive to blacks nearly forty years after the Civil Rights Movement of the 1960’s? Actually, the answer lies somewhere in between. Joane Nagel states, “Ethnic Identity, then, is the result of a dialectical process involving internal and external opinions and processes, as well as the individual’s self-identification …” (240). So if blacks have an anti-business ethnicity, then the responsibility for that must be shared between blacks themselves and their oppressors. Similarly, upon examining Micahel Omi and Howard Winant’s definition of hegemony, which they assert has been the dominant mode of rule in the United States, wee see that “hegemony [is] always constituted by a combination of coercion and consent” (152). So any societal oppression that the white males in power are able to levy against blacks must be accepted by blacks in order to be effective. In other words, both blacks and their white oppressors must share the responsibility for the decided failure of black men (and women) to take their places as leaders in business.
One such solution is the establishment of moral superiority of our criminal justice professionals over our ordinary citizens. It also discussed the decriminalization of victimless crimes, so that our prisons have more room for violent offenders. Another possibility discussed in this section was the equal distribution of wealth to allow youths access to better schooling and more, realistic, opportunities for the lower class to move up in society. In addition to providing possible solutions it also addressed the reasons that these solutions would not be feasible, mostly that these recommendations would create too much competition against the
Reuter, Peter. The Organization of Illegal Markets: An Economic Analysis. Washington, D.C.: Government Printing Office, 1985.
In “The Way to Wealth” Benjamin Franklin writes, “We are taxed twice as much by our idleness, three times as much by our pride, and four times as much by our folly” trying to prove a point that frequently people are being taxed an outrageous amount and are taxing themselves extra by actions like spending excessive amounts of money (Franklin 237). Throughout Franklin’s “The Way to Wealth,” he explains how an American economy should work and maintain a stabilized economy for themselves. In the American realm today, about 5.0% of people find themselves facing unemployment, a time of stress and conflict (“Databases, Calculators & Tables by Subject”). With the unemployment rates rising for the first time since February of 2015, the American economy is also facing an increase in debt levels throughout personal households
Education can be somewhat helpful to people headed toward poverty or homelessness. However, new research is showing that education is needed but alone it is simply not enough to help people get jobs and help their situation. Along with their education, the poor need job training in the area of work they are looking towards (Bernstein 1). The training along with the mandatory education helps people excel in something they are good at and improve their job chances. The people who do get their education and job training then run into another roadblock. In the U.S. economy, typically low-wage jobs are more abundant. In fact, the low-wage sector of the economy is the part that is projected to grow the most. In the next ten years, thirty new low-wages jobs are expected to be added to the work force. Of those thirty, half of the new jobs will require very little training (Bernstein 3). This results in a lower quality of work and less pay. Many people on the verge of poverty occupy these low paying job...
What seems to go unnoticed by many Americans is the evident and growing wealth gap. According to Pew Research Center, the current U.S. income is at its highest since 1928. This large dispersion of wealth can be attributed by the “fall [of the] routine producers” (Reich). Where jobs that were once attainable during the 70s are declining due to advancing technology and corporations finding workers in poor countries who are willing to work at half the cost of the routine producers. What also drives this wealth gap is the power of corporations in an age of extravagant consumerism. Through media, the demand to buy what we want is unavoidable. Corporations are able to gain revenue while people go unemployed because of America’s vast opportunities to buy what we want when we want it.
The book I chose to review for this course is titled, “The Millionaire Next Door”, by Thomas J. Stanley, Ph.D., and William D. Danko, Ph.D. After learning that it was published in 1996, prior to the widespread availability of the internet, and subsequent ebusiness boom, I was slightly sceptical that the information held within might not be relevant for someone like myself trying to thrive in today’s chaotic economy. Fortunately, I was wrong. The Millionaire Next Door is full of concepts and principles that put into perspective how we view money and status in our society, and also debunks the myth that America’s wealthy are the ones doing most of the spending while living elaborate and carefree lives. There are several ‘takeaway’ principles that are presented to the reader. I will be focusing on the five concepts and ideas that impacted me the most.
... of it. The only manner in which significant populations of people could truly escape this economic entrapment would be through hard fought social reform, but the path would not be easy to walk for any party involved.
High workloads, high stress and low wages are the norm, (Greenhouse, 2008) which translates into a lack of work/life balance. Consequently, the largest job growth sector in America is the low wage retail and food service sector. (Draut, 2005) Chain stores are everywhere, making jobs at places like Starbucks and Best Buy plentiful. Unfortunately, these types of jobs pay little above minimum wage. This puts the debt-strapped college grad in the impossible situation of having an income, but not earning enough to cover the basics. Further still, working in food service and retail guarantees an unpredictable schedule. Some retailers will post work schedules only a few days to a week in advance, (Draut, 2005) while others will call their employees at the last minute to fill shifts, thus making it difficult to plan or have a social life. And considering that many college grads work in these industries, it is understandable how this kind of work-stress coupled with financial stress is a recipe for disaster. In addition, employees often risk losing their jobs when they need to miss work to care for sick children. (Greenhouse,
The people that David Shipler interviewed are the type of people seen every day working at restaurants, Wal-Mart, and gas stations. They do not fit into the prejudice description of mooching welfare recipients. They are people on the edge of the poverty line that are affected by a multitude of issues that snowball into a lifetime of a constant debt and crisis. Shipler studies these working po...
...benefit economically from their activities on these markets. Countries with offshore centers that specialize in money-laundering reap significant benefits. Unlike the negative effects of the Mafia and organized crime, the positive effects are direct and quickly noticeable (Van Dijk 56). Even though it may seem like the revenue from all of the illegal activities helps the economy, it actually does not. There are profits but it does all lead back to negativity: corruption, lesser rule of law, risk of business, etc. The economy is actually slowed down and weakened rather than strengthened (Van Dijk 52).
Skaperdas, Stergios. "The Political Economy of Organized Crime: Providing Protection When the State Does Not." Economics of Governance 2.3 (2001): 173-202.
Organized crime has had deep roots in almost every part of the world for hundreds of years. It has become entangled in aspects of people’s everyday lives, all the way up to the highest ranks of the government, and everywhere in between. In a majority cases cartels and mafias bring corruption with them everywhere they go. Seeing that developing countries have all the right ingredients for organized crime to flourish, its effects are severely felt by the population. These crime rings play big roles in creating instability in the society in which they function through the trade of illegal substances and establishment of large drug rings. The presence of an organized crime group in more developing nations also corrodes the local economy through
From the sound of the phrase, an ordinary reader would assume that black market is a place for the exchange of merchandise. In fact, black market refers to economic activities involving illegal transactions of goods and services. The goods and services involved or found in the black market may be genuine and legal in nature, but the process of transacting may make the whole process illegal. The activity of transacting illegal business bears the name “black” because it involves dark practices that always dodge the legal environments. According to Bahmani-Oskooee & Goswami (2005), the process is usually secrete and concealed from the legal officials who otherwise would have known about the transactions if they were legal. Although security officers and intelligence authorities have been striving to stop the practice, there is no sign that black market trade will come to an end any time soon. People who oppose black market trade cite reasons that include a number of well-observed facts. For example, the trade endangers the lives of consumers; moreover, it leads to the loss of taxes. In addition, it negatively affects legal business systems; it increases criminal activities and it violates cross-border trades. It is clear that black market trade is a serious economic issue and since it is unlikely to end , it is important to inform readers of its positive and negative points. Even though the phrase black market sounds enigmatic and undesirable in the current economic conditions, global economists attribute particular advantages to black market trade. Among the alleged advantages of black market trade are facts such as the following: the practice helps improve the circulation of money in the economies, it creates employment opportun...
In December 2007, the United States of America experienced a very scarce yet appealing setback. In fact, because of this specific dilemma between 200,000 and 500,000 were left unemployed and without a stable home. The national Bureau of the Economic research defined this nationwide downfall as “The great recession”. According to the U.S Bureau of labor statistics the unemployment rate has not made a drastic improvement since the start of the great recession. Unemployment has become that is still rising today with a slow rate of change. Unemployment is usually expressed as a number or as a percentage of a larger number. Although it has been ambiguous who has to be included in the percentage, there are members of society without a job, for whom it is certain that should not be added. Officially the unemployed are the people who are registered with the government as willing to work and able to work at a going wage rate but can’t find suitable employment despite an active search for work. In the article “why long-time employment can’t get back on track”, the author begins speaking on a ...