Civics Participating in Government

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Civics Participating in Government
Chapter 16
Governments Role In Our Economy
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Civics Participating in Government
Section 1 Government Intervention in Our Economy
Section 2 Governments Efforts to
Solve Economic Problems
Section 3 Managing the Economy
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SECTION 1 OBJECTIVES
1. Explain how American Values are reflected
our economy. 2. Describe the methods used by
governments to correct or prevent economic
problems. 3. Analyze the debate over government
intervention in the economy.
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Government Intervention In the Economy
American Values and Economic Goals
What are some American Values?
Individual Freedom
Political Freedom
And Economic Freedom
The Founding Fathers or Framers of the
Constitution wanted to create an economy based
on a Market System or Free Market sometimes
called Capitalism (very little government
involvement).
Reading the Constitution, who was given the
authority to ensure the economy would grow? Look
up (Article 1, Section 8)
Congress. Has the power to coin money, collect
taxes, borrow money, and regulate commerce.
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Government Intervention In the Economy
The Limits of Free Enterprise
Without Government Involvement, the Free
Enterprise System did not always promote the
common good. Why?
Problems arose.

• Businesses earned profits unfairly.
• Conditions for workers have sometimes been unsafe
  and inhumane.
• Unsafe products have harmed consumers.
• Not all Americans have had economic security.
• The economy has been unstable.
• The environment has been damaged.

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SECTION 2 OBJECTIVES

• Summarize the governments efforts to ensure
• fair business practices.
• 2. Examine the governments attempt to
• provide economic security for Americans.
• 3. Analyze the governments role in protecting
• the environment.

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Governments Efforts to Solve Economic Problems
1. Ensuring Fair Business Practices
Eliminate Trusts and Monopolies - A Trust is a
(group) of business that agree to set prices so
they can all benefit. - A Monopoly is a (single)
business that controls prices. In response to
public pressure congress passed the Sherman
Antirust Act in 1890. This act outlaws
agreements among companies that limit competition.
2. Protecting Workers
Safe Working Conditions Congress created the
Occupational Safety and Health Administration
(OSHA) in 1971. This agency sets and enforces
safety and health standards in the workplace.
Why would some monopolies still be allowed or
legal???
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Governments Efforts to Solve Economic Problems
3. Protecting Consumers
What do we (were all consumers) need to be
protected from?
In 1927 Congress created a new agency called the
Food and Drug Administration (FDA). The FDA sees
that food, cosmetics, and drugs are safe and
labeled correctly.
4. Providing Economic Security
How does and how far should the government go to
protect and ensure economic security?
Social Security provides income when a person
retires, get injured or dies (for family members).
Public Assistance
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Governments Efforts to Solve Economic Problems
5. Maintaining Economic Security
Monetary Policy Through the Fed as we learned
in Chapter 15, the money supply can be
regulated. Fiscal Policy A governments
decisions about how it spends its money and the
amount it collects in taxes.
6. Protecting the Environment
Our government is involved in protecting the
environment through regulations (rules) its
created. The Environmental Protection Agency was
created in 1970 due to citizen pressure. What
are some local examples of this debate? What
Global Debate is occurring as a result of
pollution and increased industry? What is your
opinion regarding economic growth vs. protecting
the environment? These are important questions
you need to ask yourself as you get near legal
voting age
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SECTION 3 OBJECTIVES

• Describe how the Federal Government raises
• money.
• 2. Explain the balance between federal spending
• and federal income.
• 3. Analyze the causes and dangers of the
• national debt.

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Managing the Economy
The Nations Economic Health
Government Tracks
New jobs Created
Employed and Unemployed
Imports and Exports
And..
Inflation - inflation is closely watched.
Remember, inflation is a general rise in the
price of goods. Money loses its buying power!
The major goal of the government is to make the
economy grow. It is measured by calculating the
Gross Domestic Product (GDP). The total value of
ALL goods and services produced in a year.
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Managing the Economy
The Federal Budget Income vs Spending
Sources of Federal Income. Any Guesses????
1 Income Taxes Personal, Social Security and
Corporate income tax.
Excise Taxes, taxes on specific goods like
gasoline, alcohol, cigarettes etc Are these
fair?
Tariffs, fees and Sales imported goods, sales
of government property or land, and fees at parks
and monuments.
The deficit is a huge concern in our
country. This is the amount by which
government spending is greater than government
income.
What happens If your parents live like this at
home?
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Managing the Economy
The National Debt
What is it?
The amount of money the government owes to
lenders
One major problem is interest. Like any
borrower, the federal government has to pay
interest on the money it borrows. As the debt
grows so does the interest owed. This has to
come out of the federal budget. As a result
there Is less money for current programs and new
programs to promote the common good.
Current National DEBT