Government and business

Lead-in

Classify the tasks you consider to be governmental responsibilities in order of importance.

- education

- health care

- working conditions

- social security

- defence

- public transport

Key Vocabulary

Study the following list of vocabulary.

1. interfere in smth \ intervene in smth	вмешиваться во что-л.
2. allow v	позволять, разрешать
3. responsibility n	ответственность
4. poverty n	бедность
5. essential adj	важнейший, необходимый
6. recreational facilities	места отдыха и развлечений
7. invest in smth	инвестировать, вкладывать
8. environment n	окружающая среда, окружение
9. free enterprise system	система свободного предпринимательства
10. government regulation	государственное регулирование
11. laissez-faire	невмешательство
12. tax breaks	налоговые льготы
13. fine-tune v	регулировать
14. inflationary adj	инфляционный
15. deep recession	глубокий спад
16. threaten v	грозить, угрожать
17. reduce v	сокращать, уменьшать, понижать
18. interest rate	процентная ставка
19. economic emergency	чрезвычайное экономическое положение
20. runaway inflation	безудержная инфляция

Pre-reading Activities

Translate the sentences into Russian. Mind the list of Useful Vocabulary.

1. If inflation threatens the US economy, the Federal Reserve System may adopt policies that increase interest rates.

2. During a depression the government may try to increase demand by cutting taxes so that people have more money to spend.

3. An essential part of economic freedom is freedom to use the resources we possess in accordance with our own values.

4. In some countries producers don’t depend on the government regulations and make all decisions themselves.

5. A mixed type of economy with a rather high degree of government intervention is a feature of some developed countries, such as the USA, Canada, Japan.

Reading

1. Read the text. Ask 4-5 questions about its contents and let the group answer them.

To what extent should the government interfere in the economic system? On the one hand, it can intervene minimally, allowing the forces of supply and demand and the price mechanism to determine what goods and services are to be produced. On the other hand, the government can make all major decisions such as what to produce, how to produce and for whom to produce.

Most governments operate between these two extremes. But there are always some things which are under the government’s control. For example, health care is a sphere of a state responsibility in all civilized lands, as no one can be assigned to illness or death because of poverty. The state has many other essential functions: parks and recreational facilities, the police, libraries and others. By the way, to support science is also the government’s responsibility. Together with this, it usually invests in agricultural productivity, modern air transport, advanced information technologies and the environment.

The USA points to its free enterprise system as a model for other nations. But exactly how free is business in America’s free enterprise system? The answer is, not completely, because a complex web of government regulations shapes many aspects of business operations.

It is known that historically, the US government policy toward business was summed up by the French term laissez-faire – “leave it alone”, but laissez-faire practices haven’t prevented private interests from turning to the government for help on numerous occasions, such as grants of land and public subsidies, protection against strong competition, tax breaks and others.

As for the British government, it seeks to fine-tune the economy in order to keep economic booms from becoming too inflationary and recessions from becoming too deep. The British government often manages demand, intervening when demand for goods and services is high enough to threaten inflation. In such cases the government tries to reduce demand by raising interest rates and taxes. In economic emergencies the government can control prices and incomes to a considerable extent, but this is done only in extreme circumstances such as in times of war and runaway inflation.