Topic 3.1 Free Enterprise Notes

Topic 3 American Free Enterprise

3.1 Preserving Economic Freedoms

Objectives
1. Identify ways that the government acts to protect Americans’ economic rights within our system of free enterprise.
2. List examples of how the government creates policies to serve the public interest.
3. Describe how the government intervenes to protect public health, safety, and well-being.


Public Interest – The concerns of the public as a whole.

Examples of how the government acts in the public’s interest:
• Warning labels on cigarettes
• Safety ratings on cars and MPG estimates
• Nutritional facts on food

The government can address problems the free market might ignore, like toxic substances in food.

Protecting public interest means giving up some economic freedom. Most Americans are willing to make the trade-off between less economic freedom for some government intervention.

Consumers can let their voices be heard by producers and the government in two ways:
1) Through consumers buying decisions
2) Through electing officials

Public Policy – Law and standards on topics of public interest

EX: Should we spend more money on defense or improve housing for the poor?
Should we dam a river to generate power or leave it in its natural state?

Interest Group – A private organization that tries to persuade public officials to act or vote according to group members’ interests.

EX: The National Rifle Association (NRA) resisting stricter gun laws.

Pros
• Collection of individuals is more influential than just one citizen.
• Can bring about change that reflects interest off the entire public.

Cons
• Corporate funded groups outspend citizens
• Powerful groups can bring about change that is not beneficial to all.

In order create economic freedom and give consumers choices, then the public needs to be informed of relevant information.

Public Disclosure Laws – Laws requiring companies to provide full information about their products.

EX: Many times hamburger will have its label the day it was packed, the “best buy” date and preparation instructions.

Major Federal Regulatory Agencies

FDA (Food and Drug Administration) – Sets and enforces standards for food, drugs and cosmetic drugs.

FTC (Federal Trade Commission) – Enacts and enforces antitrust laws to protect consumers.

FCC (Federal Communications Commission) – Regulates interstate and international communications by radio, television, satellite and cable.

FAA (Federal Aviation Administration) – Regulates civil aviation, air-traffic and piloting standards, and air commerce.

EEOC (Equal Employment Opportunity Commission) – Promotes equal job opportunity through enforcement of civil right laws, educations and other programs.

EPA (Environmental Protection Agency) – Enacts policies to protect human health and the natural environment.

OHSA (Occupational Safety and Health Administration) – Enacts policies to save lives, prevent injuries and protect the health of workers.

FEMA (Federal Emergency Management Agency) – Coordinates a response to a disaster in the U.S. that overwhelms the resources of local and state authorities.