You're right, I can't say more laws are causing less crime. But I can say more laws and less crime are correllated in the US, which is still a counter-example to your Tao Te Ching quote, that claims more laws cause more crime. We know that's not true.
The quote might be true in ancient or modern China, where the laws and restrictions are being made in a dictatorial regime to censor the populace. But that would mean this isn't a quote about the nature of laws, it's a quote about the nature of China in a specific context, and can't really be applied to situations outside that context.
In the U.S., despite the temporary uptick in property crimes in the 80s, it went away again, and on the whole, on average, violent crimes have been in decline for 300 years while the number of laws and restrictions has gone up.
I wouldn't call the war on drugs or 3 strikes to be examples of crime expanding, those are both examples of government campaigns to fight crime. They are both controversial, with a loud and large contingent of citizens who believe those campaigns exaggerated the problems and are wasting vast amounts of tax money without reducing crime rates.
> I think getting more people out of poverty reduces the crime rate (and also adds safety).
Totally agree with you there. Side note, some people believe the "war on drugs" actually perpetuates poverty: https://en.wikipedia.org/wiki/War_on_drugs#Creation_of_a_per...