What are the pros and cons of government involvement in the economy?

Question

Is governement involvement in the ECONOMY actually beneficial to the society??

Arguments for both sides???

Answer 1

social security will be bankrupt in 20 years medicare is a fiscal disaster. do you really think the government can fix this?They don't seem to have any luck with anything else.

The best thing about a free market is that it can fix itself. let the government do what they do best and protect our country from terrorism and other threats.

It sounds great to have a utopian society and everyone have the same stuff but it's been tried and failed so many times it's a proven disaster.

I don't feel like standing in line for Toilette paper.

Answer 2

Government regulation in an economy does have pros and cons. The primary objective of any government is to steer  the ship in the right direction. The major tools are monetary and fiscal policy and international trade restrictions and incentives. Monetary policy is implemented by a supposedly neutral Reserve Bank (increasing and decreasing interest rates) and Fiscal policy (raising taxes/cutting taxes) implemented by the government. Simply put the cons are barriers to trade through tariffs and irresponsible monetary and fiscal policy. The pros are keeping inflation in check and creating incentives for trade thereby reducing the national debt. A surplus by any government is a major achievement. This provides money in the bank for a rainy day. Thank you.