1. Review of the Role of Government

2. Brainstorm!
What should the main economic role(s) of the government be?

3. Four Economic Roles of the Government
1.  Regulate Business 
2.  Provide public goods
3.  Promote citizen’s economic well being
4. Stabilize the Economy

4. Regulate Business A. Prevent abuses
EEOC Equal Employment Opportunity Commission
OSHA Occupational Safety Health Administration
B. Protect Consumers
FDA Food & Drug Administration
CPSC Consumer Product Safety Commission
FTC Federal Trade Commission
SEC Security & Exchange Commission
Federally insure banks

5. Regulate Business (Cont.)
C. Limiting Negative Externalities
E.P.A. Environmental Protection Agency
NRC Nuclear Regulatory Commission
Fights traffic congestion, soil erosion, and pollution
D. Promote competition
S.E.C.
antitrust regulation to stop creation of monopolies

6. Must be available to all people whether it is used or not.
Provide Public goods
Road Maintenance
Public Schools
Courts
Law Enforcement
National Defense
U.S. Postal Service
Must be available to all people whether it is used or not.

7. Privatization of public goods
Some companies have replaced the government agencies such as:
UPS and Fed Ex
Garbage companies

8. Promote Economic Well Being
A.  Improve standard of living
-Programs like Medicare and Social Security
B.  Redistributing Income
-Welfare programs help the poor

9. Stabilize the Economy A. Raise interest rates to fight inflation
B. Lower interest rates to stimulate growth

10. In order to provide these things:
The Government must use a tax system!
What is the best level/format of taxation?
Flat
Progressive
Other?