How much of the US economy is under the radar?

[raccoon]

I mean, how much doesn't have a paper trail and never shows up in any government stats? Such as, but not limited to, illegal drug transactions, prostitution, or paying people cash to do yard work, babysitting, etc.

Has anyone seen any information about this? (Of course, it's a guess no matter who's doing the guessing.)

[SmokingJacket]

1. Like my eBay empire??

I would guess a good chunk is.

[smtpgirl]

4. by the way

are you rich from selling on eBay?

Dick thinks so

[SmokingJacket]

6. Haha, no.

My empire consists of $400 made from selling knitting supplies.

[specimenfred1984]

2. Excellent Question!

More and more of our economy will go "black market" as the complete frauds of healthcare, energy, insurance, tax reform, education, pension reform, Social Security reform, banking, stock markets, etc...drive "consumers" to look for alternative methods of obtaining these things.

I don't have any numbers but it'll be great to see what other people come up with!

[stillcool]

3. the defense industry....

is the ultimate black hole as it connects to drugs and arms sales and circuitously appears back in the coffers of global corporations' funded think tanks, non-profits, and PAC's.

[valerief]

5. You got that right

[specimenfred1984]

7. Found Some Links...

http://www.edd.ca.gov/taxrep/txueoind.htm

http://www.frontpagemag.com/Articles/ReadArticle.asp?ID=16532

There are a lot more links when searching for "underground ecomony". From what I read, estimates range from 4 to 40%, depending on the area. The repug sites predictably blame illegal immigrants and most sites point the finger at pot, porn and illegals.

It's a very interesting question and a very poorly researched topic, at least as far as I can tell.

[raccoon]

8. Thanks for those links.

“The ultimate impact (of the underground economy) is erosion of the economic stability and working conditions in this State (California).”

http://www.edd.ca.gov/taxrep/txueoind.htm

Seems to me that the loss of jobs due to outsourcing/downsizing, moving the company to another country, also causes erosion of the economic stability and working conditions in the US.

[specimenfred1984]

9. I Asked the People Over At STOCK MARKET WATCH

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=2136575&mesg_id=2137584

Maybe they'll come up with some good articles.

[AnneD]

11. Here are some article and studies...

I think people are pretty much the same so this may give you an insite.

They estimate 27% in S Korea
http://times.hankooki.com/lpage/200602/kt2006022617591810230.htm

In China?????
http://www.econbrowser.com/archives/2005/10/china_gdp_stati.html

The last IRS estimate in 1998
http://www.ncpa.org/ba/ba273.html

A good overall look
http://www.alternet.org/story/14909/
http://www.frontpagemag.com/Articles/ReadArticle.asp?ID=16532

[54anickel]

12. The US does the least amount of study in this area compared to

EU and Canada. There are some estimates that it could be as high as 40% of GDP, of course that estimate includes things such as re-selling, rummage sales and donating blood. The best anecdotal evidence that it's growing is the huge increase in the use of $100 bills. I read somewhere that they make up 60% of the cash in circulation now. Some of that increase in usage of large bills can be attributed to inflation of just about everything, but it comes at the same time when "plastic" transactions (credit or debit) have increased two or three-fold.

ILO had a conference that touched on this topic a couple of years ago. Haven't really looked to see if much of it's been updated. Here's an older article:

http://www.alternet.org/story/14909/

Looks like the Construction Industry in Ontario finds it threatening. ;-)
http://www.undergroundeconomy.ca/index.html

Sorry, can't be much more help than that. It's a topic I tend to steer clear of.

[raccoon]

13. Can people still get paid for donating blood?

And thanks for the links.

I bet the US doesn't want to know the extent of the underground economy.

[htuttle]

15. For blood plasma, yes

They usually return the platlets in a saline solution, which is refrigerated...BRRRRRR!!! Though it's been many years since I sold any -- Bush Sr was president -- I know that there are still places that buy plasma.

BTW, my personal impression of lying on a bed/couch having blood drained for money in a huge open room of other beds with other poor people having blood drained for money was a metaphor for the modern economy that still stays with me. I honestly felt like we were being 'harvested'....

[54anickel]

19. Yep, but that blood is then directed to the cosmetics industry. At least

according to one of the techs at the local blood center I donate at. She used to work at the downtown center where they paid for blood. It's used a lot in make-up and some skin care products. Yuck. :puke:

[IrateCitizen]

10. Read "Reefer Madness" by Eric Scholsser

He's the author of "Fast Food Nation". This was his second book, about America's underground economy.

[raccoon]

16. I'll check into that. nt

[sendero]

14. A LOT..

.... I can tell you that much. There is and always has been an active cash economy. Anywhere there are illegal workers, there is a lot more of it.

Believe me, if the government could stop the use of cash tomorrow, they would.

That said, the only interesting statistic would be "as a percentage of the total economy, how much is unreported cash, and how much was last year and previous years" - that is, is the percentage changing over time?

[raccoon]

17. One doesn't have to be an economist to suppose that

the percentage is going up, up, up, as does the unemployment rate, the REAL percentage of Americans in poverty, and the cost of nearly everything.

"as a percentage of the total economy, how much is unreported cash, and how much was last year and previous years" - that is, is the percentage changing over time"

[sendero]

18. If I had to guess...

... I'd guess up also :)

[54anickel]

20. Don't forget about barter as well. Quite a bit of that going on these days

especially with all of the un-employed/underemployed specialists/skilled-labor out there. Lots of "favors" being exchanged these days. ;-)