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Author Topic: Tax laws create burgeoning (>$1 trill) underground economy  (Read 1299 times)
marcus_of_augustus
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April 21, 2011, 08:53:52 PM
 #1


edit:removed bad calc. (thnx tom)

http://www.businesswire.com/news/home/20110418006433/en/Book-Reveals-Tax-Laws-Spur-Huge-Underground

Book Reveals Tax Laws Spur Huge Underground Economy

The United States has an “underground economy” – in which no taxes are paid – that already amounts to more than $1 trillion a year and is growing fast, according to a new book, which notes that this underground economy is now greater than the total economies of all but fifteen other countries

WASHINGTON--(BUSINESS WIRE)--In his book, “Class Tax Mass Tax: America and Its Underground Economy,” author Peter Rush cites example after example of how congressional tax laws discriminate against average, hard-working American families and in favor of loopholes for wealthy individuals, unions and corporations. He notes that this trend has accelerated in recent years as federal and state spending has ballooned.

He shows how the convoluted, archaic and unjust tax code has led to increased “tax cheats” and the expansion of the shadow economy. Furthermore, Rush sees a direct connection between this growing underground economy and the current Tea Party movement to the Boston Tea Party protesting British tea taxes in 1773.

“By taking a page from our revolutionary past, American taxpayers are taking the problem of over-taxation into their own hands,” he writes. “Working out of sight of the tax collector is a direct and effective way to reduce personal taxes. Penalizing work and thrift makes no sense to the average man – and we are a sensible people.”

He urges all Americans to make their voices heard at both the federal and state levels to tame spiraling budgets and irresponsible government spending. Tax avoidance, he argues, is thoroughly understandable and may be expeditious, but it does not address the underlying problems, nor does it contribute to the ultimate cure. If most of the people in the country are breaking the law, isn’t it reasonable to examine the law?

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tomcollins
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April 21, 2011, 09:06:04 PM
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You are forgetting the velocity of money component.

For example, I may spend $50,000 in a year.  But I don't need to have $50,000 at any time to do this.  Say I only trade with one other guy.  I sell him potatoes and he sells me oranges.  I sell him $1000 a week, he sells me $1000 a week.  We only really need $2000 in this economy.  But there might be $100,000 of economic activity in any year.  This is because we trade 50 times the same money.

No one is going to sit on that much of their cash.  They'll spend it and they'll earn it.
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April 22, 2011, 01:28:21 PM
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The philosophy of not paying tax to government to attempt to prevent it from spending/existing is called agorism. Bitcoin will mean we don't even need tax loopholes to do it.
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