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Wednesday, July 19, 2006
Herman Cain :: Townhall.com Columnist
Illegal Dirty Little Secrets about Social Security
by Herman Cain
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There are two dirty little secrets behind the debate over the illegal alien issue that even the advocates of securing the borders first have failed to discuss. The first secret is that the estimated twelve to twenty million aliens living and working illegally in the United States have to commit identity theft to secure employment. The second secret is that without illegals' payroll tax contributions, filed under stolen or fraudulent Social Security numbers, the Social Security system would collapse years earlier than estimated.

Hard to believe, here are the facts.

The birth of the connection between illegal aliens, identity theft and the Social Security system began in 1986. That year Congress passed the Immigration Reform and Control Act (IRCA), which required workers to show a Social Security card to obtain employment. IRCA also made it illegal to knowingly hire undocumented workers. The consequence of IRCA is that millions of stolen or fraudulent Social Security numbers have been used in the past twenty years. IRCA did nothing to curb illegal aliens from crossing our borders to find work, or to end employers' demand for their labor.

A 2006 General Accountability Office study reports that the Social Security Administration maintains a database called the Earnings Suspense File (ESF) to track fraudulent use of Social Security numbers. When an employer files payroll taxes for an employee, and the employee's name and Social Security number do not match or the number does not exist in Social Security's records, the unmatched or fraudulent number is recorded in the ESF. Though estimates of illegal aliens present in the U.S. range from twelve to twenty million, as of November 2004 the ESF contained over 246 million records.

The GAO also reports that forty-three percent of employers that file payroll taxes on stolen or fraudulent Social Security numbers represent just five industries. Further, 8,900 employers, .2 percent of all employers with reports in the ESF database, have submitted over thirty percent of the ESF's total records.

According to a 2005 report by MSNBC technology correspondent Bob Sullivan, the ESF represents $420 billion in payroll tax contributions. Illegal aliens who work under stolen or fraudulent Social Security numbers will never receive Social Security benefits, so the hundreds of billions of dollars they contribute represent what Sullivan rightly calls "essentially free money to the system." Eduardo Porter reported in the New York Times that payroll taxes from illegal aliens represent approximately ten percent of the so-called Social Security surplus.

Enforcement of labor and immigration law is further hamstrung by a byzantine bureaucratic nightmare constructed by Congress in an effort ironically designed to protect privacy. Under current law, the SSA is barred from sharing information in the EFS with the Department of Homeland Security (DHS) because it contains taxpayer records. Congress has enabled massive invasion of our privacy by encouraging identity theft and not allowing DHS to effectively investigate employers and employees suspected of labor and immigration law infractions. Even though the EFS contains 246 million records of stolen or fraudulent Social Security numbers, in 2004 DHS only initiated 5,400 investigations of employers or workers suspected of breaking labor or immigration laws.

Illegal aliens represent cheap labor for employers and billions of dollars to the government to temporarily prop up the failing Social Security system. Congrtess is not only doing nothing to restructure Social Security, but its wink-and-nod policy toward illegal aliens and their employers encourages massive identity theft and ruined financial standing for millions of Americans.

Common sense solutions exist, but the political will to enact them is missing. First, Congress must allow DHS access to the ESF files. The ESF files would literally provide DHS the roadmap to employers and workers guilty of breaking labor and immigration laws. It’s not just law enforcement, it’s a matter of national security.

Second, Congress must increase and enforce penalties on employers of illegal aliens. Most employers want to obey the law, but the laws have to be enforced.

Third, we must secure our borders. That does not mean sending a few thousand members of the National Guard to assist border patrol agents. We must also secure the most porous areas of the border with whatever means necessary, or legal American citizens will continue to fall prey to massive identity theft.

Illegal aliens present a challenge to national security, and a false sense of temporary security to our failing Social Security system. Failure to fix the problem just makes the problem worse.

That’s not a secret. It’s common sense.

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About The Author

Herman Cain is the National Chairman of the Media Research Center’s Business & Media Institute. He is the former president and CEO of Godfather’s Pizza, Inc., and currently is CEO and president of T.H.E. New Voice, Inc., a business and leadership consulting company.

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Illegal aliens Social Security
I don't see what the problem is. The politicians didn't have any problem stealing our legal contributions to the Social Security Fund.
Now they have a chance to atone. Like passing a law that provides that people who use false Social Security numbers forfeit their right to claim Social Security benefits.
And lock boxing the Social Security Fund so they can't steal any more.

Join The Howard Beale Memorial Society. Get Mad! Fight Back! Get Even. Go to http://www.networkcentralca.net and learn how.

Industries will have to inovate
Politicians are obviously protecting certain industries like farming, and Bush in particular has a soft spot for the Mexican workers who worked for him in the oil business. But legal labor will eventually be available in these industries without the millions of illegals. Wages will go up in all five industries almost immediately if we ever crack down, so there will be some painful adjustment. But it must be done. Americans want the border closed and a severe crackdown on employers and illegals, and are fed up with the willfull nonenforcement since 1970. This enormous problem has to be redressed.

How
How does something that has been well known for years suddenly become a secret?

Illegals and Social Security
I was born in 1934, the year before FDR signed the Social Security act into law. For Socialism in our country 1935 was a banner year for Socialists and Communists. In addition to Social Security it also say the birth of massive laws favoring labor, the Soak the Rich Tax Act, and the birth of the Communist Congress of Industrial Organizations (CIO). Friends of my family were required to become card holding members of the Communist Party before they could get a job down at the CIO Union hall to feed their families.

Originally SS was known as the Widows and Orphans Relief act and was limited in scope but like all Socialist Ponzi schemes it rapidly grew into a huge uncontrolable bureaucratic monster.

We were guaranteed that our SS Account number would only be used for nothing but business dealing with our Social Security account. Today,my son's military serial number is his SS number. When his first son was born, my first grandson, he was issued a Social Security number before he left the hospital. You canot get a loan, credit card, buy a gun, property, or check in at the Veterans hospital without disclosing your Social Security number. Another Socialist promise broken.

To those who steal into our country and use a false SS number or one from a stolen identity our Liberal/Socialists in Congress lament that these hard working "Guest Workers" will gain no benefit from the FICA money taken out of their salary from jobs illegally and fraudulently procured. I submit that those lost benefits must be regarded as an additional penalty for breaking our laws by stealing into our country. First Principle: No benefit must be allowed to accrue from any illegal act.

Missing Step
We will have illegals staying into this country until we fix the immigration process. There are plenty of hard-working people who want to be citizens; guest workers are unnecessary.

When the legal process takes close to a decade, why would anyone want to follow the rules? If we can't give a yes/no on whether someone would be a good canidate within 1 year, someone is not doing their job. If we could verify most people's story within three months, why would anyone come illegally?

Even a wall along the border won't stop overstaying visa and "vacationers" that don't return home.

Open our doors to hard workers. Get them here quickly. Watch the economy grow.

How many broken laws?
First these illegals break federal law by entering the country illegally.
Then they break federal law when they fraudulently misstate the number of dependents on the W-2.
Next they break another federal law when they purchase a 9mm automatic pistol. And, believe me, it is a toss up whether the first paycheck goes towards a firearm or a pickup truck.
Now, they beak state law by neglecting to insure their pickup truck.
DUI laws, to the illegal, is something only Gringos need worry about. So when they get caught driving without insurance, they merely shrug and go purchase another pickup. If they have an accident. They just disappear. If the accident results in a fatality, they run back across the border,go to another border state and return somewhere else to start all over again.
And these are the 'honest, hard working' ones, not the gang affiliated.

Really. Why do the politicians even WANT a path to citizenship for these people?

The Social Security fraud
Neither the Republicans nor Democrats want to bring this immigration problem to a head. They all realize what shaky ground Social Security is on and they just want to delay the problem so somebody else has to deal with it.

For awhile now...
...I wondered what happens to the money that employers were sending to SSA and IRA in the form of taxes from their employees.Does the IRS keep the money? Does the SSA keep the money?Well,now I know what the SSA does with it.So illegal aliens are supporting our Social Security.What about the IRS? Do they send it back to the employer? If they do,does the employer pocket the money? Or does he give it back to the employee? If the IRS keeps the money,I guess the illegal aliens are paying taxes after all.

Social Security and Illegals.
Immigration reform IS needed. We need to take out the requirement to show that there is no American to meet the minimum requirements for a job before a work visa is granted. In my opinion, this was a sop to unions.

Once that is done, and the process streamlined, then we could get a partial grip on the problem.

Of course, they could all advertise in the online dating forums and get married and come here..........

Question for Mr Cain....
Did you miss your invitation to the RINO Immigration meeting? Because most of the other columnist here at Townhall.com seem to back Prez Bush's "No Illegal Alien Left Behind" Senate bill.

We are glad to see some of the columnist aren't turning into full fledge socialist. Maybe you could write an article about how the other communist...I mean columnist have fallen prey to socialist/liberal ideas that make Ted Kennedy proud!

It Ain't "Extra" Money for long
Whether an illegal alien/immigrant pays something into SSA or the IRS it is a pittance because they make very little to begin with. I also believe there are billions being paid by temporary employers, even those homeowners who hire off the street corner. They pay cash, not withholding.
The big offront to Americans is when anyone suggests paying back SSA benefits to lawbreakers. The biggest disgusting idea is to turn these folks into RESIDENT taxpayers, many of which will become Tax Beneficiaries of the Earned Income Tax Credit. That will get REFUNDS of money never paid into anything because they earn so little.

A Slightly Different Take
What would happen to this whole wrangle if we a.) eliminated the minimum wage, b.) cut the Federal Income Tax rate to 10% for everyone (no exceptions), and c.) eliminated Social Security and Medicare (along with all the other entitlement programs)? Oh, and d.) made it MANDATORY for all residents of the U.S. to pass the citizenship test now required only of legal immigrants who desire to become citizens on pain of having to find another nation to live in if one refused or failed the test.

It won't happen, of course, but wouldn't it be wonderful if all the folks who detest this country yet live here anyway were required to swear allegiance through the oath of citizenship? I wonder how many of them would go back to Europe or wherever else their ancestors came from?

For more, check my blog at http://phoenix-rising.townhall.com/Default.aspx

Government is racist...
when they don't hold people from Mexico to the same level of accountability to our laws that they hold whites & blacks.

SS Revenue from illegals
Wouldn't we generate more revenue if we did everything legally?

How about not allowing any illegals to work in the US--using all available means to ensure that employers don't hire illegals, illegals can't use stolen SS numbers and illegals, when discovered, are deported. Now employers, deprived of their cheaper labor force, will have to increase wages somewhat to hire true American citizens. The increase in pay would be accompanied by an increase in payroll taxes. Then all we have to do is figure out how to keep the Washington folks from stealing that extra money to fund their favorite pork projects...

Illegal aliens
From what I know, most illegal aliens work under the table, and don't pay payroll taxes at all! When I hear pro-alien people say they "pay taxes", I almost puke - they pay sales taxes that they cannot avoid, but what else?

"Under the table" payroll is not taxed at all, which is a big reason such people work so cheap.

This is another big point in favor of Fair Taxes, for example, with the underground economy finally having to pay taxes, like the rest of us!

Just the facts please
Gee, where to start. Certainly not with the comments posted as most of those people have no factual basis for knowing what “they know.”

You state: “The birth of the connection between illegal aliens, identity theft and the Social Security system began in 1986. That year Congress passed the Immigration Reform and Control Act (IRCA), which required workers to show a Social Security card to obtain employment.”

That is not correct. People always needed a Social Security Number for tax purposes. Aliens not authorized to work in the U.S. used to get Social Security Cards that were not valid for employment but until 1982 that notation was not on the face of the card. Note the following:

“In 1974, statistics revealing continually increasing numbers of illegal aliens working in the United States motivated SSA to distinguish SSNs issued for nonwork purposes. Although SSA’s internal records reflected the distinction, however, the SSN cards issued to both groups looked identical until SSA began to annotate nonwork cards with the restriction Not Valid for Employment in 1982.”
Singer and Dodd-Major, Identification Numbers and U.S. Government Compliance Initiatives, 2 Immigration & Nationality Law Handbook 346 (2004-05 ed.)

See also the GAO study you cited “Since 1982, when SSA began issuing cards indicating they are not valid for employment,...” Immigration Enforcement: Benefits and Limitations to Using Earnings Data to Identify Unauthorized Work at 9 http://www.gao.gov/new.items/d06814r.pdf

It was in 1982 that some aliens needed to obtain a social security number that was not issued in their real name. Many of those people work under social security numbers that were issued to people years ago who left the U.S. You could call that identify theft but I doubt if any court would agree with you as the person from whom the number was “stolen” consented to the “theft.”

The short GAO study you site (it is only 16 pages) should be read in total to get a better idea of the situation. It is not just “illegal” aliens in the suspense file. For example the Earnings Suspense file “Contains information about many U.S. citizens as well as noncitizens—the overall percentage of unauthorized workers is unknown. Immigration Enforcement: Benefits and Limitations to Using Earnings Data to Identify Unauthorized Work at 10 http://www.gao.gov/new.items/d06814r.pdf

You have numerous other gratuitous comments not supported by facts. “Illegal aliens represent cheap labor for employers” and “roadmap to employers and workers guilty of breaking labor and immigration laws” imply that all illegal alien workers are a) underpaid and b) known to the employer to be illegal. As generalizations these conclusions are false. Those who meet employers who have gotten their first Social Security “mis-match letter” know full well that most employers have no idea that a particular worker is illegal and often are not simply paying that worker a just wage but a wage far above the prevailing wage simply because the person is such a good worker and, more importantly, if that person quit the employer would have a devil of a time replacing that person because there is a labor shortage is many areas of the U.S.

We need a guest worker program now and real conservatives should be supporting such a plan.

Just the facts please
Gee, where to start. Certainly not with the comments posted as most of those people have no factual basis for knowing what “they know.”

You state: “The birth of the connection between illegal aliens, identity theft and the Social Security system began in 1986. That year Congress passed the Immigration Reform and Control Act (IRCA), which required workers to show a Social Security card to obtain employment.”

That is not correct. People always needed a Social Security Number for tax purposes. Aliens not authorized to work in the U.S. used to get Social Security Cards that were not valid for employment but until 1982 that notation was not on the face of the card. Note the following:

“In 1974, statistics revealing continually increasing numbers of illegal aliens working in the United States motivated SSA to distinguish SSNs issued for nonwork purposes. Although SSA’s internal records reflected the distinction, however, the SSN cards issued to both groups looked identical until SSA began to annotate nonwork cards with the restriction Not Valid for Employment in 1982.”
Singer and Dodd-Major, Identification Numbers and U.S. Government Compliance Initiatives, 2 Immigration & Nationality Law Handbook 346 (2004-05 ed.)

See also the GAO study you cited “Since 1982, when SSA began issuing cards indicating they are not valid for employment,...” Immigration Enforcement: Benefits and Limitations to Using Earnings Data to Identify Unauthorized Work at 9 http://www.gao.gov/new.items/d06814r.pdf

It was in 1982 that some aliens needed to obtain a social security number that was not issued in their real name. Many of those people work under social security numbers that were issued to people years ago who left the U.S. You could call that identify theft but I doubt if any court would agree with you as the person from whom the number was “stolen” consented to the “theft.”

The short GAO study you site (it is only 16 pages) should be read in total to get a better idea of the situation. It is not just “illegal” aliens in the suspense file. For example the Earnings Suspense file “Contains information about many U.S. citizens as well as noncitizens—the overall percentage of unauthorized workers is unknown. Immigration Enforcement: Benefits and Limitations to Using Earnings Data to Identify Unauthorized Work at 10 http://www.gao.gov/new.items/d06814r.pdf

You have numerous other gratuitous comments not supported by facts. “Illegal aliens represent cheap labor for employers” and “roadmap to employers and workers guilty of breaking labor and immigration laws” imply that all illegal alien workers are a) underpaid and b) known to the employer to be illegal. As generalizations these conclusions are false. Those who meet employers who have gotten their first Social Security “mis-match letter” know full well that most employers have no idea that a particular worker is illegal and often are not simply paying that worker a just wage but a wage far above the prevailing wage simply because the person is such a good worker and, more importantly, if that person quit the employer would have a devil of a time replacing that person because there is a labor shortage is many areas of the U.S.

We need a guest worker program now and real conservatives should be supporting such a plan.
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