In recent years, currency in circulation has been growing more rapidly than demand deposits. Since currency is the only form of cash suitable for transactions that go unrecorded and untaxed, the disparity is a reflection of growth in the subterranean, extra-legal economy. Estimating that, in 1976, the subterranean economy generated an illegal GNP of $176 billion, the author predicts that rising tax rates and the ever-increasing burden of government regulation will continue to drive more and more of our total economy underground.