Friday, October 14, 2011


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Because I do not really know very much about various things the government does or could do, as far as the economy, I would have to say that the role that the US government has in the economy is about where it should be. Considering all things, the US economy has been relatively strong and compared to the rest of the world for quite some time now.

The proper role of government should be as follows. The government should monitor the economy constantly, preventing any major depressions. They could accomplish this by setting ‘ceiling’ prices and ‘floor’ prices. This would prevent Supply and Demand to get all out of whack. The government needs to pump money into the economy when the markets decline, as FDR did to get out of the Great Depression. That would keep the money flowing. Once the economy is back on track, the government would then be able to even things out by raising taxes.

I also have to agree with Friedmans. He feels that as long as individuals do not violate the laws of justice, they should be free to pursue their own interests and that competitive markets rather than government regulation are usually the most effective alternatives available to us. It makes sense in a ‘free’ enterprise market, the only thing the government should be regulating is the laws. Keeping justice should be the most important role that the government should play in a nation’s economy. The economy would be better off without the US Governments involvement.

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