the classic misunderstanding

In an article titled, "Work on the black market--losses for the budget," the Romanian News Agency ACTMEDIA reports that the informal economy in the country has grown dramatically:

The share of the unobserved economy in the GDP went up by almost one third over the last four years, increasing from 14.5% in 2004 to over 21% in 2008. Thus, potential income in the economy which were not collected for the budget reached 58.1 billion lei over the first nine months of 2008, with 11.3% of GDP.

The news agency notes that most of the informal is quite mundane: "tailors, auto mechanics, barbers, decorators, plumbers, teachers with private lessons or people who hire their house for the summer."

But the biggest example of lost revenue, accordign to the article, is this: "the share of collection from construction taxes in the GDP, which was kept the same over the last five years, although the sector recorded an annual rate of growth of 17-20%."

Unlicensed and unauthorized construction comes about as a result of lax enforcement and corruption. Instead of blaming the 'black market,' the Romanian government should look to its own failings.