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Big Government drives the economy underground

Some days ago, cnbc.com ran an article called $2 Trillion Underground Economy May Be Recovery’s Savior. It uses quotes from experts:

The shadow economy is a system composed of those who can’t find a full-time or regular job…

“You normally see underground economies in places like Brazil or in southern Europe,”…

Estimates are that underground activity last year totaled as much as $2 trillion…double the amount in 2009, according to a study… “The jobs are in service industries from small food establishments to landscaping.”…

A report from ADP Research Institute states that many employers, especially in low-wage businesses such as retail and food service, plan to reduce workers’ hours to less than 30 a week to avoid having to offer health benefits through Obamacare…

“The result is less tax money paid to the various levels of government.” “Those working and not paying the taxes puts the burden on those who pay the tax,”…

Workers who aren’t on the books don’t get Social Security or health benefits…

Several points here leap out at me.

  1. How Obamacare destroys full-time jobs, as predicted by many on the Right before it passed.
  2. How ‘normal’ taxation creates Second or Third World conditions in the economy.
  3. How people can at least survive, when taxes are lower (or absent).
  4. The experts’ and media’s cluelessness about all this. Despite the information presented by the article, its unspoken perspective remains that government is robbed, when people avoid taxes. Umm… how about people being robbed, when an excessively large and redistributive government taxes them so heavily that they (or their potential employers / trading partners) are forced into the underground economy?

In other words: Shouldn’t we shrink government and lower taxes enough that people won’t need to be in the underground economy?

That’s the question these articles never ask; the one you’re supposed to never think about. They are always written from an assumption that people do something illegitimate, when they avoid the government’s tax man; never from an assumption that the government does something illegitimate, when it charges people enough to drive them to it.