Role of Government in the Budget Process
The budgetary process begins when the president submits a budget request to the U. S. Congress in conjunction with the Office of Management and Budget, with recommendations for how much the government should spend, how much tax revenue is needed, and how much of a deficit is permitted (Policy basics, 2020). The president also lays out budgetary priorities, and the budget typically extends not only for a single year but also for the upcoming nine years, (subject to change) with evidentiary support from previous years and projected growth (Policy basics, 2020).
Next, Congress holds hearings, interviewing various representatives of the administration, and passes its own budget resolution. This concurrent resolution does not go to the President to be signed or vetoed, and cannot be filibustered (Policy basics, 2020). In recent years, Congress has not been able to agree on such a resolution, resulting in the previous years resolution to carry over (Policy basics, 2020). Finally, Congress considers various appropriations bills to enact and later reconcile the budget (Policy basics, 2020).
Role of Government in Correcting Externalities and Market Failures
Although the monetary policy set by the
An externality is a cost or benefit of an economic activity experienced by an unrelated third party (Externality,...…protect them. While there may be some truth in this assertion, however, it is equally true that often the people who suffer the worst from uncorrected externalities are those who have no power over the companies perpetuating them. For example, someone may live near the runoff from a polluting factory, even though the poor resident is not purchasing the companys products and generating its revenue. Many Americans who had no role in the subprime mortgage crisis of 2008 still lost retirement savings as a result of the unraveling of the banks, and bailouts bolstered confidence in the U.S. economy once again. As well as justice, the government has an important protective role, to prevent citizens from becoming unhealthy or failing…
