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11 January, 2013

My Name is Cash

The American Spectator : My Name is Cash: Barter is as old as human history. According to a story in the Wall Steet Journal, it is yet practiced as a facet of the 21st century global economy. Germany, for example, “sends coal to Brazil for coffee, and imports cattle from Denmark in return for agricultural implements. Finland sends timber to the U.K. for coal. Argentina trades grain to Spain for railway equipment.” And so on.

Farmers markets and yard sales are certainly popular in small town America. Every summer weekend in Texas features some 200 towns with farmers markets... in Salmon, Idaho, three summertime produce markets are a welcome respite from the tyranny of [the] single grocery store. The local radio station has a morning weekdays show called “Swap Shop,” where goods and services are noted, and listeners call-in with their own for-sale items, queries, and promotion of services. The common theme is the lack of a middleman, and transactions in cash or barter. This time of year firewood is a big commodity. And following a recent heavy snowstorm here, I shoveled an elderly lady’s driveway, walks, and wooden back deck. Roughly one hour’s labor: $12; and since she was pleased with my work, a bonus cup of coffee.

The Internal Revenue Service definitely has guidelines for conducting such commerce, and these are mostly ignored: “The fair market value of goods and services exchanged must be included in the income of both parties.” According to Stephen J. Dubner, writing on Freakonomics.com, the current underground economy (both licit and illicit activity) in America makes for a “tax gap” of $345 billion annually, and the IRS mostly can’t touch it. Though estimates vary, beyond our shores it seems that up to a staggering 25% of the global economy is underground...



2 comments:

  1. This is definitely very interesting. You actually caught me by the title itself and when I read the whole article it just surprised me. This is really a great post.

    ReplyDelete
    Replies
    1. I can't claim credit for writing it, but I thought it was interesting as well.

      Be sure to follow the link at the top to read the whole thing. I don't post complete articles that aren't mine without permission; this is just a brief snippet with a link to take you to the original. :)

      Delete

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