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Write a 3 page essay on Do we need government If so, what should be its role.The most significant part of the economy stability is the Fiscal responsibility. Debts of the government can easily be an e
Write a 3 page essay on Do we need government If so, what should be its role.
The most significant part of the economy stability is the Fiscal responsibility. Debts of the government can easily be an economy burden and make its foundations weak. Sound microeconomic policies improve the government credibility and strengthen the institutions of politics. Therefore, the government has a responsibility in stabilizing the economy.
Government acts as policymakers in the role of gaining a stable economic environment for growth in economics. It defends and enforces property rights, maintain currency stability and give an oversight assurance to private citizens on accountability of their transaction partners. Therefore, it allows the participants in the market to start placing their resources again to work in most beneficial areas (Atkinson, 1997).
The economy performs with a massive and increasing the amount of regulation. The appointed regulators introduce price controls mainly in most utilities like electricity, telecommunication and gas (Barr, 2004). Economists of free markets criticize the control scales in the economy saying that it forms unnecessary costs burdens for businesses. Therefore, regulation can impose new competition in the market. For example, attempt to impose competition for the British Telecom.
President Barack Obama responsibility on Fiscal last February showed his understanding on the need of Fiscal discipline. The president’s proposed budget and Congress enactment of Reinvestment Act and the American recovery make the goal of a budget that is sustainable (Geoft, 2013). It also addresses long-termed nation’s fiscal priorities like liabilities entitlement, even vaguer.
The government controls the country debt deficit to stabilize the economy. Large deficit can lead to instability of prices and inflation if it finances the deficit through printing money. Inflation is as a result of depreciation of the currency that makes goods from foreign countries more expensive. Hence, it results to