Prosperity

1. How can you measure American prosperity?

·  A. Economic Wealth: Gross Domestic Product, or GDP
 

 

·  B. Jobs and Unemployment
 

 

·  C. Prices and Inflation
 

 

·  D. Trade
 

 

·  E. Inequality
 

 

2. Markets and Politics
 

- The ideal of the "free market" is very attractive to Americans in theory -
         

                   Because it promises both freedom and prosperity

 

- Government are indispensable for markets (for example, government protects property rights and contracts)

    in practice, Americans constantly ask government to intervene in markets because:

 

• They want
  
  to be physically safe (so they want government police and a military)
  
   

• their property to be protected (so they want government courts)
  
   

• to be protected from cheats and "side effects" like pollution (so they want government regulation)
  
   

• to be protected from economic risk (so they want a safety net - like Social Security, government unemployment insurance, and some kind of government health care)
  
   

• want the benefits of public goods, that is, goods that society needs but are too expensive for business to provide adequately (so they want public education, public roads, public airports, and public parks)
   

American business often supports many of the same things
 

The central question: Where to draw the line between politics and markets?

.