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Everyone, including undocumented workers, are already thoroughly, completely, exhaustively tracked.

Replacing SSN would daylight this fact, exposing an inconvenient truth.

Can you explain this? If I apply for a lease how does the Fedral government know or block me?

If I need to authenticate through their system the Federal government will definitely know.

I didn't follow the leap from undocumented workers reusing SSNs to applying for a lease.