Infowars.com
PrisonPlanet.tv
Listen Now
Carlos Cruz has a strategy for surviving the worst global recession in 60 years: pay less in taxes and pass the savings along to customers.
“I’m declaring half as much as I used to,” said Cruz, 29, who runs a painting business in Madrid. “Prices have fallen by 30 percent and customers will choose you for a difference of as little as 50 euros ($67.70),” said Cruz, an Ecuadorian who has lived in Spain since 2001.
Even as the U.S., Japan and Europe weather the first simultaneous recessions since World War II, some types of activity are expanding worldwide — just below government radar. The production of goods and services that are lawful, though not declared, may grow the most as a proportion of total output since 2000, according to Friedrich Schneider, a professor at Austria’s Johannes Kepler University of Linz.
The shift, measured by tax analysts and economists using surveys, money-supply data and anecdotal evidence, is caused by businesses going off the books to cut costs and workers taking informal jobs to survive rising unemployment. It offers a buffer against the ravages of the crisis and may help explain why the slowdown hasn’t prompted more social unrest.
‘Good News’
“The good news then is that the recession, as captured by the official statistics, may not be as severe as it appears,” said Edgar Feige, a professor at the University of Wisconsin- Madison who has studied the underground economy for 30 years. In past slumps, unregistered activity increased as a proportion of the official economy, he said.
