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The Government's Role: When should it step in? | Chapter 6

When the Government Does Too Much

From preserving the national defense to securing individual rights, the government has its own set of duties that only it can perform. However, because the government is doing more activities than necessary, it performs many of its functions poorly. That leads to inefficiency and the loss of economic freedom.

How Government Policy Inflates Health Care Costs: The Curse of Cross-Subsidies

Cross-subsidies exist when the government allows companies to overcharge one set of consumers in order to subsidize others. Cross-subsidies require the government to enforce monopolies to stifle new competition that would otherwise offer lower prices. Innovation suffers and prices rise as a result. A more effective way to lower health care prices is to tax and spend on budget using market prices.

How Government Power Threatens Freedom

We have forgotten the basic truths that the founders of this country knew so well: the greatest threat to human freedom is the concentration of power, whether in the government or anyone else. Preserving the freedoms that we have will require a more widespread understanding of the danger of overgoverned societies.

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