The refugee underground economy exists in other states but nowhere near the extent that it does in California, according to resettlement officials. This is mostly the result of fewer Indochinese living outside California who are dependent on welfare and therefore enticed by underground jobs.
Federal, state and local cash assistance to refugees in California amounts to more than $2.7 billion over the past 10 years. The money thus lost to welfare fraud could extend to hundreds of millions of dollars, officials concede. And this would not include income taxes uncollected from the workers and unemployment, Social Security and workmen's compensation taxes uncollected from the employers.
Private resettlement workers and county officials say the formation of a clandestine refugee work force in California underscores a failure on the part of federal, state and local agencies that oversee refugees and help them become self-sufficient.
An Orange County social service official, Wayne Warner, acknowledged that job training and job placement programs have failed to serve a large number of refugees. Warner and county administrators statewide say the programs--designed for the state's indigenous poor--do not have the staff, the funding or the type of services required to place a diverse population of Southeast Asians in jobs that will lead to self-sufficiency.
Others blame a bureaucracy that refuses to confront the problem for fear that it will become a pretext to cut back refugee services.
"Frankly, we are afraid of the consequences of going public, afraid that it might become fodder for the Reagan Administration," said Robyn Ziebert, who until recently worked for the Pacific Asian Consortium in Employment, a Los Angeles-based group that assists refugees in finding jobs. Ziebert now works for an international group aiding refugees in El Salvador.
'Are Deeply Committed'
"This is a very emotional program, and we are deeply committed to refugees. But there are things that are happening (such as the underground economy) that we just can't live with anymore."
The existence of a refugee underground economy in California has national impact. The state's 400,000 Southeast Asians represent 40% of the nearly 1 million Southeast Asian refugees who have been resettled in the United States since the fall of South Vietnam, Cambodia and Laos in 1975. Among them are many poor and rural families whose perilous flight across the South China Sea made them known to the world as "the boat people."
In many ways, the labor underground is the story of how the "boat people" have fared since leaving refugee camps in the Philippines, Malaysia and Indonesia and beginning a new life in America. It illustrates how higher welfare benefits coupled with the promise of underground jobs help to serve as a powerful magnet to California, luring one in every four Indochinese refugees who are initially resettled in other states.
It helps explains the motives of a people who have taken a strong work ethic and built a remarkable economic system to cushion against poverty, a system that stretches legal and illegal dollars by pooling resources and living as extended families.
Finally, it provides one answer to a question that has long confounded researchers studying the most expensive and ambitious resettlement program in U.S. history: Why, in California, do so many Southeast Asian refugees on public assistance exhibit so little motivation to leave the welfare rolls?
"The mathematics are real easy," explained Daniels of the International Institute. "The jobs we have for refugees pay $4 and $5 an hour. A family of seven is making $1,032 a month in welfare. We can't compete with welfare, much less welfare and the illegal income they're earning."
The resettlement of Southeast Asian refugees, since it first began in 1975, has spawned a nationwide debate over the role of public assistance and its potential for creating long-term welfare dependency.
Upon arrival, refugees are eligible for the full sweep of public assistance, including Aid to Families with Dependent Children (AFDC), food stamps, Medi-Cal and a cash assistance program designed specially for refugees who are single or married and without children. Only this last program has a time limit. In addition, refugees are eligible for vocational and language training and job placement services.
Concern Over Studies
Since 1981, Congress and the Reagan Administration have expressed concern over studies concluding that California's Indochinese refugees lag far behind those in other states in achieving economic self-sufficiency.
A nationwide survey by the federal government in 1983 revealed that welfare dependency rates for Southeast Asians living outside California dropped by one-third after two years of residency. In California, the dependency rate stood virtually unchanged.