The Problem's Not A Quadrillion Dollars In Sour Derivatives ... It's Italian Tax Evasion!

Tax evasion is a national pastime afflicting southern Europe ... "Wherever the olive tree grows, you won't find much tax being collected," the mayor of a small town in southern Spain told me a few years ago. He shrugged; such was life. He probably had no idea that some high-powered academics were about to come up with the same conclusion. When they analyzed Europe's "shadow economies" – defined as areas that fall beyond the reach of the taxman – those of Greece, Italy, Spain and Portugal were much larger (relatively) than those in northern Europe. That is partly because of the higher number of self-employed and family businesses, which tend to deal in cash and pay little tax. But to many economic commentators, tax evasion is also a national pastime in much of southern Europe, and a significant factor in the region's burgeoning financial crisis. – CNN

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