The Poverty Peril

By

William D. Dannenmaier

A must read for anyone concerned, justifiably concerned from listening to national news media, about the growing problem of poverty in the United States is Walter E. Williams essay “The Poverty Hype” (Townhall.com, April 2, 2008). In his article Dr. Williams, a nationally famed economist, analyzes factual data concerning the differences in income between low-income and high-income families. He debunks much of what we hear on television, in newspapers and in speeches by Mrs. Clinton and Mr. Obama. But there is one group he neglects to mention. 

Nowhere in his article does Dr. Williams address the existence of undocumented, unreported, income. As a trivial example, I have a garden every year. Essentially, we quit purchasing vegetables in June and fruit in July, not returning to the market until late autumn. All of the spinach and tomatoes I eat from my garden, all of the apples, peaches and pears are, in fact, unrecorded and unreported income. Were I alone in this, the example would be a matter to be ridiculed, but there are tens of thousands like me. The next question, in what Dr. Williams calls “The Poverty Hype,” is who plants such gardens and eats as I do, those in the bottom third or the upper third of the economic scale? I suspect most such are in the bottom third, since I seriously doubt that multi-millionaires such as Pelosi, the Kennedys, Kerry, Reid and such ever pick up a shovel or lift a hoe. 

Then there is another, more expensive factor, affecting the official economy. When my mother needed her gutter repaired some forty years ago, the neighbor next door repaired it – for a price. I doubt that he ever reported that income. Similarly, in 1980, an acquaintance in North Dakota told me of a visit to a friend, an artist, in Seattle who was about his age, middle thirties. He laughingly told me of her nice apartment and that she told him that she had never turned in an income tax. (He was not a very thoughtful person. If he had considered the possibility that his taxes were helping support her, he might not have considered her avoidance of tax such an accomplishment.) In 1990 I knew an American employed as a civilian by our army in Germany who refused to attend a meeting in the United States on a subject that was his responsibility. He told me that the meeting would have given him too many days in the States. He would have had to pay income tax. 

Retiring to my Tennessee home in 1992, I needed some immediate construction repair. I was surprised at the end of the week when I saw the contractor reach in his pocket, pull out a wad of cash and pay his workers: no social security, no health insurance, no retirement, just cash. In the fifteen years since then, I have become accustomed to that. An astonishing number of people in our area are employed yet still receive food stamps and welfare benefits. Some of them are doing rather well in “poverty,” some better than I did as a teacher.

From my experience, tax evasion by persons at the lower income levels has been ongoing for years, and throughout the country, not just in the hills of Tennessee.

I sometimes wonder how many of them report their incomes – all of their incomes. I couldn’t remember their names, of course, but I have the impression that they don’t see any dishonesty involved, they did their work, it is their money and it is none of the government’s business. I am sympathetic; it is unfortunate that I have no such skills having always been employed by larger concerns that never failed to take out every penny the government thought I owed.

I confess, that in considering this, I remembered how I would put a single salmon egg on a tiny hook and cast it out, hoping some thoughtless trout would seize my gift. Is it possible that Congress, in promising $400 “gifts” to those who turn in income tax forms this year are hoping some of these ersatz “poor” will seize the bait and file returns that they haven’t filed in the past? Well, it is an interesting idea.

Anyway, I’ve filed my darned return and, no, I did not report the value of the tomatoes that my neighbors gave me when mine failed. Perhaps this year my garden will permit me to return that gift, legal or otherwise.