There is No Defense for Working Underground
by goldhawk on 2007-09-23
The underground economy is defined roughly as all production that is hidden from tax and mandatory social benefit contributions like employment insurance. Some people have tried to make the argument that the underground economy is actually good for us. They say independent operators in the underground economy keep money away from the state that would only squander and misuse it. They look on these tax evaders as honest, peaceful individuals who make more efficient use of resources and money than society at large does.
In a word, crap.
There certainly are many people in the underground economy who work as hard as anyone else to make a buck. They trundle off to the big box stores to stock up on stuff at volume prices and peddle the products out of their homes or vans to their communities. Of course, they mark up the products until most are above what we would pay at any other outlet. But these homefront sellers are convenient. The operators also knock on an endless number of doors offering their services for all cash, no questions asked. And some deliver acceptable services.
The problem is that consumers have no protection at all when they deal with the underground economy operators. If a window washer falls off his ladder on your property, get ready for a multi-thousand dollar lawsuit or an under-the-table payment to keep him quiet. If the guy takes your money and runs, you cannot even find him, much less complain to anyone about this theft. If you cause problems for one of these characters, he or she can turn you over to the authorities for not having a building permit or paying proper taxes or for any other infractions for which the homeowner is to blame.
One nitwit who defends this black economy says the operators provide value to their customers at competitive and affordable prices. Again, crap. They can outcompete legitimate businesses who pay their taxes, hire trained staff, get permits and have licenses and insurance. Gee, wonder why? Are their prices affordable? Likely they are not much below legitimate pricing but add in the taxes you will have to pay and the services you will lose because this bunch of leeches are not paying their fair share. You will find you paid a helluva lot more for that cheap home repair or other so-called service.
There is also the argument a lot of immigrants get involved in the underground economy because they have valid fears of state controls and state police practices. A big crap on that. Immigrants are heavily involved in the legitimate economy - the honest ones.
Our cops are not heavy handed; our politicians are not dictators and our tax people are usually highly professional and easy to deal with, if you are a good guy. People get into the underground economy because they are greedy and want to evade their responsibilities to the community and the country in order to enrich only themselves. That's it, folks.
In a word, crap.
There certainly are many people in the underground economy who work as hard as anyone else to make a buck. They trundle off to the big box stores to stock up on stuff at volume prices and peddle the products out of their homes or vans to their communities. Of course, they mark up the products until most are above what we would pay at any other outlet. But these homefront sellers are convenient. The operators also knock on an endless number of doors offering their services for all cash, no questions asked. And some deliver acceptable services.
The problem is that consumers have no protection at all when they deal with the underground economy operators. If a window washer falls off his ladder on your property, get ready for a multi-thousand dollar lawsuit or an under-the-table payment to keep him quiet. If the guy takes your money and runs, you cannot even find him, much less complain to anyone about this theft. If you cause problems for one of these characters, he or she can turn you over to the authorities for not having a building permit or paying proper taxes or for any other infractions for which the homeowner is to blame.
One nitwit who defends this black economy says the operators provide value to their customers at competitive and affordable prices. Again, crap. They can outcompete legitimate businesses who pay their taxes, hire trained staff, get permits and have licenses and insurance. Gee, wonder why? Are their prices affordable? Likely they are not much below legitimate pricing but add in the taxes you will have to pay and the services you will lose because this bunch of leeches are not paying their fair share. You will find you paid a helluva lot more for that cheap home repair or other so-called service.
There is also the argument a lot of immigrants get involved in the underground economy because they have valid fears of state controls and state police practices. A big crap on that. Immigrants are heavily involved in the legitimate economy - the honest ones.
Our cops are not heavy handed; our politicians are not dictators and our tax people are usually highly professional and easy to deal with, if you are a good guy. People get into the underground economy because they are greedy and want to evade their responsibilities to the community and the country in order to enrich only themselves. That's it, folks.
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