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SS to Pay $100(s) of Billions to Illegal Workers

Bruce Krasting's picture




 

I wrote a blog
recently regarding a comment made to the WaPo by Steve Goss, the boss
at the SSTF. Goss confirmed that as of 2007 SS had collected as much as
$240b from undocumented workers. That blew my mind. I knew there had to
be money, big money. But I did not think it could be that high. The
number has grown since 2007, and the whole ball of wax is earning
interest. So where is this money going to go? I’ll refine the issue:
Assume:
A person comes illegally to the US and illegally obtains a fake SS and
using that fake # finds work. This person stays in the US continuing to
work illegally for many years. During that period this person has SS
payroll taxes deducted from their paycheck. This person returns to
(Mexico) and at age 62 applies for SS retirement benefits.

Question: Is this person entitled to receive benefits? If so what are the conditions for payment?

Well, I got this wrong. So did all the people I asked (including a
lawyer). How about you? The answer is that an illegal worker using an
illegal SSN has the same rights to SS benefits as a legal worker with a
legal SSN. The only difference is that the person who worked illegally
must receive those SS benefits outside of the USA.

In 2006 the Ensign Amendment was drafted to eliminate this interesting
treatment. The bill was defeated in the Senate by a 49-50 vote. Senator
Leahy (D.Vt.) said at the time:

"We
should not steal their funds or empty their Social Security accounts.
"That is not fair. It does not reward their hard work or their financial
contributions. It violates the trust that underlies the Social Security
Trust Fund."

Goss put a number of $240b as of 07 out there. I took that estimate and
extrapolated where it might be today. I came up with 1/3 of a trillion.
What might be the future liabilities of SS regarding this? About $500b.
Should that be the result, that amount MUST be paid (and spent) outside
of our borders. This makes no sense to me. None of it does. But that is
the way it is.

My original post was bashed to pieces at another site, Angry Bear. There
were some interesting comments that I participated in. A lady that
works for SS made some important contributions. She had a fair bit to
say. She explained how the SSN’s are illegally obtained. She describes
her role in facilitating payments to beneficiaries who worked in the US
illegally and that used fraudulently obtained SSNs. The AB site does not
like me and what I write. Neither do their contributors. The lady who
made available the clarifying information does not like me much either.
Her final thoughts:

Sir, give this up. It is dishonest, misleading and wrong to do what you are doing. I am finished writing to you on this subject.

The entire discussion can be found here. Some cut and pastes from the comments section:

SS does
not keep track of benefits paid by beneficiary immigration status. That
is because as far as the program goes, it doesn't matter. Earnings in,
benefits out. To emphasize, it is perfectly legal for a person to
receive SS benefits on wages earned while in the country illegally as
long as the person receives those benefits outside the US. It has always
been legal as far as I know. I was hired as a bilingual speaker of
Spanish to process these claims and did so personally or in a
supervisory capacity.

They (SS) hired me to take claims from people who were insured for
benefits, illegal or not. Then, of course, people can go home and get
checks. This is LEGAL. Believe it or not, perfectly legal. If Congress
had intended to, it could have passed a law making all those quarters of
coverage disappear. But, they didn't and they haven't and I'd be
surprised if they ever do.

Again, the real kick in the pants is that the money MUST be paid out of
the country. Who says America does not have great legislators and great
laws? No wonder we are becoming second rate.

 

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Sat, 09/11/2010 - 19:40 | 576147 Unscarred
Unscarred's picture

Damn shame this post got junked 23 times.  But, such things tend to happen when opposing yet open-minded thoughts are shared.

Shame.

Wed, 09/08/2010 - 03:53 | 568974 fajensen
fajensen's picture

Go ask the Siux, the Crow or the Mohicans how mass immigration worked out for them - oh, I forget, they are not exactly around anymore!

Or maybe you are too fat, poor and/or lazy to visit Mogadishu for some real culture exchange that certainly will leave a lasting impression on your blimp body - so, instead, you rather prefer good ole Moog to come to Boston (Better The Hamptons, actually, but that will never happen)? 

Wed, 09/08/2010 - 10:41 | 569382 DOT
DOT's picture

Bay colony was founded by the
English with some Dutch thrown in>. How did it work for them when the Germans, Swedes, French, Irish, Italians, Greeks, et.al. showed up?

Tue, 09/07/2010 - 20:53 | 568512 Glaucus
Glaucus's picture

Let the rest of them in, and you'll have your answer.

Tue, 09/07/2010 - 22:20 | 568675 thesapein
thesapein's picture

Awesome, crowd out the real criminals with idle typing hands, maybe.

Tue, 09/07/2010 - 20:46 | 568499 dark pools of soros
dark pools of soros's picture

does the term ILLEGAL mean shit to you??

 

let's just do EVERYTHING illegally then, right??

Tue, 09/07/2010 - 23:49 | 568791 Arm
Arm's picture

Laws are man made.  They can and do change often.  Many in fact are immoral. 

I only care about laws in as much as somebody can coerce me into obeying them.  However, I do care deeply about ethics and morality.

If all these people came in legally can you honestly tell us you would THEN welcome them open hearted?

Tue, 09/07/2010 - 23:46 | 568787 snowball777
snowball777's picture

depends on what you've made illegal.

jaywalking?

anal sex?

tax evasion?

funny how you 'revolution' types always heel when your master shouts.

if we give them amnesty, will you shut up?

or find a new reason to whine and another scapegoat?

Wed, 09/08/2010 - 02:03 | 568915 jeff montanye
jeff montanye's picture

i've got to ask about the anal sex.  what is that about?  (hint:  it's not illegal)

Wed, 09/08/2010 - 08:21 | 569100 au_bayitch
au_bayitch's picture

There are some various state and local laws prohibit such activities. Most based on violation of sanitary statutes. But you are correct most sodomy laws in U.S. have been repealed.

Tue, 09/07/2010 - 22:09 | 568662 thesapein
thesapein's picture

Why do you have such faith in those who wrote your laws for you? Do you think they were perfect angles and you have no moral sense of your own?

I'm not saying rebel just to rebel. I'm not even saying that most laws are immoral. Right now, I'm just asking that you pause every once in a while and ask yourself whether or not your forefathers got everything perfectly right when codifying morality.

It's very odd that you assume the questioning of one law means all laws should go.

Wed, 09/08/2010 - 11:23 | 569506 hbjork1
hbjork1's picture

thesapein,

The forefathers didn't codify morality.  The codified the rights of people living in the US.  Fundamentally at least (practice is sometimes different) The laws are made to protect the rights of people as codifyed by the forefathers.  Laws are routinely challenged before the Supreme Court whose sole function is (supposed to) determine whether the law infringes those rights.

 

Tue, 09/07/2010 - 17:19 | 568024 SmittyinLA
SmittyinLA's picture

Immigration is great-as long as you exclude the unfunded liabilities.

The numbers get even worse when you consider those same illegal aliens that "paid SS taxes" had their SS tax liability obliterated by the EITC, and they probably received local & state subsidies too-while having their working age taxes obliterated. 

Many immigrants and aliens get their "insurance premium" refunded through social programs like the EITC, but they still get the "insurance coverage" (benefits and SS income) in spite of having all their "premiums" refunded as they worked.

Add the annual growth of unfunded liabilities ($20T a year or so) and our deficit numbers really skyrocket.

Tue, 09/07/2010 - 17:13 | 567998 deadparrot
deadparrot's picture

This logic is laughable. I think I'll ask my lawyer to use SS as precedent if I am caught robbing a bank. Maybe I should be punished for the actual crime, but under this precedent, I should be able to keep the money.

Tue, 09/07/2010 - 17:46 | 568119 thesapein
thesapein's picture

It's the language, not the logic, that is laughable.

It's not a crime to work, no matter where you are from.

Tue, 09/07/2010 - 20:55 | 568518 nmewn
nmewn's picture

"It's not a crime to work, no matter where you are from."

They violated the law. They chose to commit a crime to come here without a visa. It's a crime for them to be here without it. They forged documents or lied to appear to be legal. Whatever taxes or wages aquired here are forfeit because they came about during the commision of a crime.

By your logic, an uncaught thief should be entitled to work at a bank by presenting counterfeit documents just the same as a virtuous legal resident presenting legitimate documents.

The process is there for a reason. Bad as well as well as good people come across that border.

Tell me your not abusing slave labor wages thes, I had a higher opinion of you ;-)

Wed, 09/08/2010 - 10:48 | 569410 DOT
DOT's picture

Actually entry without a visa is a civil offense, like jaywalking. Coming back in after being sent out is a criminal act. BTW as a point of style certain acts are illegal people themselves are not.

Wed, 09/08/2010 - 19:48 | 570725 nmewn
nmewn's picture

"Actually entry without a visa is a civil offense, like jaywalking."

Explain that to the "jaywalking" Guatamalans languishing in Mexican jails. I'm sure they're all ears.

Wed, 09/08/2010 - 14:49 | 570055 RichardP
RichardP's picture

Q:  How do people commit crimes?  A:  When a person breaks the law, we say a crime has been committed.  Breaking the law = committing a crime.  Someone who breaks the law is called a criminal.  People themselves can be criminals.

Does someone break a law when they jaywalk?  Do serious people distinguish among levels of seriousness of crimes committed?  Is jaywalking at the same level of seriousness as entering a country without permission (an invasion by any other name)?

Tue, 09/07/2010 - 21:53 | 568639 thesapein
thesapein's picture

Great, reference the law book for your morality. Next, you'll be quoting a religious text. 

Why would I think a legal resident is entitled to a job? You draw strange conclusions. Are you even trying to understand my point?

Oh, sure this is just about keeping the bad people out. Then why aren't we talking about that instead? I would love to talk about how protectionism and isolationism are so wonderful.

Wed, 09/08/2010 - 05:58 | 569019 nmewn
nmewn's picture

"Great, reference the law book for your morality. Next, you'll be quoting a religious text."

No diverting this time thes.

Why in your mind does an illegal have parity (because you don't like the word entitled) with a legal resident?

"Are you even trying to understand my point?"

I completely understand your point. But your saying an individual can be a sovereign individual while a group of people combined into a nation cannot.

I am a sovereign man, I have a border around myself, I impose limits (law) on what others are allowed by me to do to me. This is basic stuff thes.

Wed, 09/08/2010 - 10:18 | 569309 downrodeo
downrodeo's picture

There are a few things here that I don't fully accept.

You are a sovereign man, but you have a boarder imposed on you by your government. The laws were written by your representatives, and enforced (or not) by your government. The representatives were informed by your opinion of what you think others should be allowed to do to you, and wrote the laws thus. "Allowed by you to do to you" is an interesting way of putting it. It sounds like you bestow rights on others.

 

Also, using the thief working in a bank isn't exactly a great analogy, but that's a tangent.

 

Lastly, it seems that you're arguing only from the position of legality. If you're calling it a crime then lets look at the motive for committing the crime. Put yourself in their shoes for a moment. If you can make 10x what you currently make by violating an immigration law that is rarely enforced, wouldn't you also break the law? What if you could lift your family from poverty into relative prosperity by simply skipping over an arbitrary line [that continues to change over time]. Wouldn't it be a crime to you and your family to not take the job that values your labor at 10x the current price? The opportunity cost for not committing the crime is too great, so they come here, and we call them criminals. They're only doing what you yourself would do in their position. Don't tell me you would be some noble beggar on the streets of Mexico City rather than jump the fence to be a farmhand on an Arizona ranch for a life that was immeasurably better, or at least has the chance to be...

Wed, 09/08/2010 - 19:40 | 570715 nmewn
nmewn's picture

Has thes sent in the A-Team?...did it get over his head?...is this going to be like a tag team or sumpin?...LOL.

"There are a few things here that I don't fully accept."

You didn't say what you do accept or partialy accept...so you start off with BS and proceed with the most disjointed specie of argument I have witnessed in some time.

"You are a sovereign man, but you have a boarder imposed >>>the "boarder" imposed himself<<< on you by your government >>> no, see previous <<<.

The laws were written by your representatives, and enforced (or not) by your government. The representatives were informed by your opinion of what you think others should be allowed to do to you, and wrote the laws thus. >>> The most reality based thing you have said so far, can it possibly continue? <<<

"Allowed by you to do to you" is an interesting way of putting it. >>> Context was...as an individual I allow <<< It sounds like you bestow rights on others." >>> Ahhh, here it is, the strawman, I knew you would get to it, Saul <<<

I will say what everyone knows already, except you and thespian apparently. The "boarders rights" end where mine begin. Let's say our sovereign man from south of the border (or north, it doesn't matter in this discussion) get's past my bulldogs, alarms & net camera and winds up inside my house before I arrive home unbeknowst to me.

He is a dead man isn't he? Now, tell me why? He had liberty to go where he chose did he not?

"Also, using the thief working in a bank isn't exactly a great analogy" >>> I thought it was perfect. He is a criminal. He forged documents. He misrepresented himself. He placed himself at parity with those that did not, lie cheat and steal identities. Do those who did not break the law, forge documents and lie have better or equal standing in your view? <<<

Most of your final paragraph is drivel...but I will address this emotional outburst;

"Put yourself in their shoes for a moment. If you can make 10x what you currently make by violating an immigration law that is rarely enforced, wouldn't you also break the law?"

I can, in fact, make 10X what I make now...but I didn't choose to be a bank robber. I chose to not break the law. I chose not to risk my life or others by making 10X more, sefishly for myself. I also chose to not always look over my shoulder when I walk down the street.

Many chose to immigrate legally or work here on visa.

With "rights" come responsibilities and law. Responsibility to respect others rights and law. Law binds everyone to the same standard.

If you and your tag team partner thes can't see this then things are worse in academia than I had thought.

 

 

 

Thu, 09/09/2010 - 09:47 | 571617 downrodeo
downrodeo's picture

This is primarily an economics blog so let's relate this discussion to economics. The benefit of turning to a life of crime is a wage that is 10x what you're making now doing the exact same job. The cost is a [low potential] risk of deportation, which would mean that you have to illegally cross the border again. Although this would set you back some, you would have made more than enough at your illegal job (that pays 10x your normal rate) to recoup your losses. Like every other human interaction, it is a cost-benefit analysis. You're asking them to make the stupidest economic decision that they could possibly make.

Again, put yourself in their shoes. I really don't believe that you would do any different if you were in their position. Sorry if that is too emotional for you, but it's just the way I see things (I've got a skewed perspective because a lot of these guys are my friends).

Stop me if I'm wrong, but it seems like we're differing on is the boarder rights issue. You are arguing from the point of boarders protect property and possession. I do believe in individual property rights, you can't have an economy without them. However, on the city/state/national level, I don't see that boarders protect much of anything except tax jurisdictions. Sure, you can extend the idea that a city or state border is just the collection of individual’s boarders to define a region. If this is the case, you should be pissed at the state/country that the immigrants are coming from, not the individual workers who cross the border. The individual people are symptoms, not causative agents.

If you really care about changing the trend of illegal immigration, you have to understand first that the come here because the economic situation is so dire in their home country, at least on a comparative basis. So, for example, if you don't want to see anymore Mexicans come to this country illegally, your first priority should be finding ways to bolster the Mexican economy to the point where they can make a living wage and have a decent standard of living. Don’t say this isn’t your job or your problem, because it clearly is. You do feel very strongly about this.

 

I'll address what I thought was your best point.

"I can, in fact, make 10X what I make now...but I didn't choose to be a bank robber. I chose to not break the law. I chose not to risk my life or others by making 10X more, selfishly for myself."

That is a valid argument, and I can't say that I disagree with you in principal. However, from their perspective, if your children are impoverished, the property rights of the fat wealthy neighbor who can't remember how many houses he owns start to seem less and less important to you. You might even consider stealing from him. Sure it's selfish of them to break the law to come here; they were not being considerate of the law that says you can/cannot come on our land. Like the banksters of Goldman Sachs, they are being greedy. All of us, you, me, the migrant worker down the street; we are all continuously attempting to transcend our current position. It causes problems but it’s also the reason that we’re not running naked through the jungle right now. Call it human nature.

 

Thu, 09/09/2010 - 18:47 | 573044 nmewn
nmewn's picture

"So, for example, if you don't want to see anymore Mexicans come to this country illegally, your first priority should be finding ways to bolster the Mexican economy to the point where they can make a living wage and have a decent standard of living."

Or, alternately, send them supplies to allow them a fighting chance of overthrowing the oligarchs who control Mexico. There's a thought.

I realize you concede the legal question, however, you can't have a lasting economic system without rules...without law. The two are entertwined.

On an emotional level it breaks my heart to see these people abused. First by their own government...then by ours to allow them to used as political pawns and slave labor.

That my friend...is why a 30' wall should be built, arching toward the south. To stop the abuse...at least from our side.

However, the ones that are here illegally, they broke our law, they will have to go back. Their children will suffer for the parents actions unless they can stay with legal friends or relatives. And this will not be the first time parents did something supremely stupid.

They will have to go to the end of the line and wait like everyone else. Or, again, they can take back their own country. We did it against the greatest empire on the face of the world at the time...with a little help from the Hessians & French.

Maybe you should focus your energy helping them do that. From one seed, as they say. If it comes to a head perhaps many or I would join to help them.

But they will need the moxie to start it themselves...no one can do that for them. They have to want it for themselves, not just move to where it's better. What does that say about them?

Again, on an emotional level I'm with you. But our lives can't be controlled by emotion.

I'm gone...SeeYa

Tue, 09/07/2010 - 23:03 | 568723 doolittlegeorge
doolittlegeorge's picture

why not quote a "religious text" Mr. "Thespian."  Perhaps it could be "Lute playing for dummies"?  In the meantime even Democrats would agree "it's hard to see the votes on this one."  And of course "these benefits are indexed for inflation."  As your father might have told you "son, I've gotten more in Social Security benefits in 5 years than I paid in for the 40 i worked."  And you might reply by asking "how the heck were you able to work at the same place for 40 years and not work for the government while doing it?"

Tue, 09/07/2010 - 18:54 | 568291 Arm
Arm's picture

Completely agree.  I fail to why hard working people should be considered the main problem for the US economy? 

I tend to think it is more to do with the native parasites

Tue, 09/07/2010 - 21:46 | 568624 RichardP
RichardP's picture

I know hard-working people who went back to their native countries when their visas were up - even though they wanted to stay.  These folks should be the first to benefit from any "they are hardworking so they can stay" thought processes.  Unfortunately, they are not considered.  One of these who went home rather than stay, under the radar, was a physician and leading-edge aids researcher at the UCLA Medical Center.

If hardworking was the real reason folks are arguing to let the illegal immigrants stay, my friend from UCLA should be first in line - with thousands of others just like him right behind him.  But I think the term hardworking is being used as a distraction from the real agenda.

Tue, 09/07/2010 - 23:45 | 568784 Arm
Arm's picture

Pray enlighten us.  What is the REAL AGENDA?

 

PS: I would love to see your friend at the top of the list.  I believe in the free movement of all people.  Borders are government created.  Dare to dream

Wed, 09/08/2010 - 09:30 | 569214 downrodeo
downrodeo's picture

" I believe in the free movement of all people.  Borders are government created.  Dare to dream

THANK YOU!! Here we are bickering about an issue that obfuscates the real problems. Boarders are nothing but tax jurisdictions. Nationalities are BS, boarders are BS, nafta sure seems to be BS, and the immigration issue is total BS. Point your anger at the bastards who are using this problem for their own gain.

Wed, 09/08/2010 - 01:14 | 568880 RichardP
RichardP's picture

What is the REAL AGENDA?

Votes??  Don't know - but since I was starting to sound like a conspiracy theorist, I thought I would go all the way.

Wed, 09/08/2010 - 11:43 | 569553 tamboo
tamboo's picture

how about utter destruction of the white race?

happened in russia, about 60 million murdered.

http://www.rense.com/general86/realholo.htm

Tue, 09/07/2010 - 17:11 | 567980 RichardP
RichardP's picture

Bruce, thanks for the follow-up.  I have a business interest in the subject and am interested in learning as much as I can about it.

Can you clarify some things for me:

1.  Is the SSA obligated to pay back only what the illegal immigrant paid in, or are they obligated to pay a monthly benefit for life calculated in the same way they calculate the benefit for American legals?

2.  Is the SSA legally obligated to find the address of the illegal immigrant once he leaves the country - in order to send him his monthly benefit?

3.  Is the SSA legally obligated to notify the illegal immigrant, while he is contributing to Soc. Sec., that he must leave the country in order to claim benefits?

4.  Is the SSA legally obligated to verify that the illegal immigrant has indeed left the country before they begin issuing monthly benefits?  (Otherwise, payment could be made to an out-of-country address with the recipient still in the U.S.)

Tue, 09/07/2010 - 19:11 | 568329 masterinchancery
masterinchancery's picture

Bruce, I told you so yesterday.  Thanks for the update!

Wed, 09/08/2010 - 01:56 | 568911 jeff montanye
jeff montanye's picture

my apologies.  there are apparently more than bruce k. and i misinformed.  

Tue, 09/07/2010 - 21:39 | 568608 IQ 145
IQ 145's picture

 Thank you, Bruce. Mind boggling; glad I know this now.

Tue, 09/07/2010 - 21:39 | 568607 IQ 145
IQ 145's picture

 Thank you, Bruce. Mind boggling; glad I know this now.

Tue, 09/07/2010 - 17:19 | 568022 bigkahuna
bigkahuna's picture

my perception is that the SSA is above the law, so legal or illegal do not matter to these people. 

Wed, 09/08/2010 - 10:58 | 569441 DOT
DOT's picture

You are correct. Von Mises' short work "Bureaucracy" explains what is necessary for government to function. We have gone way WAY past all semblance of reasonable regulation. The bureaucrat can now make up rules to suit the political flavor of the day.

Wed, 09/08/2010 - 14:36 | 570028 RichardP
RichardP's picture

If you read the comments at the link Bruce gave, you will see that SSA is only following the rules given to it by Congress.  In this particular case, the bureaucrat is not the one making up the rules.

Do NOT follow this link or you will be banned from the site!