When Fidel ran communist Cuba, he intentionally limited subsidies to his people. There was enough to keep people alive (barely), but there was nothing left for some simple luxuries - a birthday cake, an extra pair of shoes, etc.
So industrious Cubans started running side businesses to make extra money. Mending clothes. Selling rice cookers bought on the black market. Tutoring kids.
Castro's secret police knew about all of these things that were patently illegal, but they turned a blind eye to these violations. UNTIL, the government needed something.
They'd show up at your door, telling you that they think that a subversive moved into the building, and that they needed you to spy on the newcomer, and report findings to the police. If you demurred, not wanting to rat out a neighbor, they would inform you that they knew you were running an illegal business, or violating some other law, and if you didn't cooperate, you'd lose your government subsidy, your government housing, your job, and you might even be arrested. Your kids would be kicked out of school, and your young adults expelled from university. In other words, they had you by the short hairs. You did what you were told.
If you go to your local library, and look at the state laws that have been passed, these books line an entire bookshelf, from floor to ceiling. Most of these laws are so vague, poorly written, that anyone can be convicted of a serious crime at the whim of any government bureaucrat. It's how they control the masses. If you speak up, or become a thorn in their side, they will start looking into your life, and will start enforcing every law they can come up with. You're done.
What's truly disturbing is that they aren't satisfied with this. They want more control. More surveillance. More limitations on freedom and liberty. More control. And the sheep just bend over, and spread their cheeks even wider.