The Government’s Role

1. The Government’s Role

2. To provide Public goods and services: • National Defense • Police and fire protection • Courts and correctional institutions. • Public Parks • Streets, highways, and bridge construction and maintenance. • Public education • Public transportation. Purpose of TAXES

3. The idea is to help those who lack sufficient income due to illness, age, unemployment or other circumstances. • The government works to reduce economic inequality by redistributing income. Money collected from taxpayers is used to fund programs that assist people in need. Redistributing Income

4. Social Security is a government insurance program that is sponsored by the federal government and pays benefits to qualified people. The benefits are paid for by a required tax on the earning of most workers. • Social Security Benefits • Retirement Benefits—at age 67 when people who have paid into social security are eligible to receive monthly benefits. • Survivors’ Benefits—When an insured worker dies the surviving spouse and any children are paid benefits to replace lost income. • Disability Benefits—Workers who develop a physical or mental condition that prevents them from working may receive these benefits. • Medicare –This is a program that pays for some of the cost of medical expenses for those over 65 and those with certain disabilities. Some programs manage the retributions of income:

5. Public assistance programs provide aid to individuals based on need, regardless of whether they have paid taxes into the program. Examples: • Provides Temporary Assistance to Needy Families. • Supplemental Security Income—Provides cash for food, clothing and shelter to the elderly • Supplemental Food Program for Women, Infants, and children—provides nutritional food and counseling to women who are pregnant or have just given birth. It also provides food to infants and children up to the age of 5. • National School Lunch and School Breakfast programs—Provides schools with surplus food for school lunches • Food Distribution Programs • Medicaid—Jointly funded by federal and state governments it provides health-related services to low-income and needy people. • State Children’s Health Insurance program—children from low income families who don’t have health insurance and don’t qualify for Medicare can receive health insurance through this program • Housing Programs—HUD provides several types of programs to help people rent or buy affordable housing. Public Assistance Programs

6. People or groups may be unintentionally hurt or helped as a result of economic activity. The government tries to prevent these harmful side effect. • Protecting the environment—EPA—The federal government has the Environmental Protection Agency which sets regulations for pollutants and takes action against polluters. • Protecting Consumers—The government helps to ensure that unsafe products are removed from the market. Also limits the distribution of potential harmful material. • Protecting workers—The federal government sets minimum wages and regulates child labor. In addition employers must provide safe working conditions for employees. Regulating Economic Activity

7. Federal and state governments have therefore enacted laws designed to encourage competition. • Monopoly – sometimes called a trust, is a situation in which a single company controls the supply of a good or service for which there is no close substitute. • Reasons some monopolies do exist- • No other company wants to produce the good • A company invents a new product and gains exclusive rights. Promoting Competition

8. These laws are designed to regulate unfair business practices that reduce competition. Antitrust laws are enforced by the Federal Trade Commission. Antitrust Laws

9. When the economy becomes unstable, both businesses and consumers suffer. The government prevents this from happening by implementing fiscal and monetary policies • The economy is at risk for a serious decline • Black Friday • Fiscal Policy- Involves adjusting its policies about taxing and spending. *Monetary Policy– Involves regulating interest rates and money supply. Ensuring Economic Stability