Government and Business
Over the last 100 years, the issue of government regulation has been increasingly brought to the forefront. Part of the reason for this, is because there has been a need for various laws to be enacted to protect the safety and interests of the general public. However, due to the fact that United States is a capitalist-based economy, means that there have been calls to limit the kinds of regulations that are imposed on businesses. The reason why, is because many pro-business advocates will argue that this can stifle innovation and progress. As firms are forced to worry about how to comply with outdated laws, that are hurting their ability to compete in the global marketplace. During the last three decades, this has led to a reduction or elimination of those laws that are coming into conflict with the interest of business.
At which point, many of the politicians revised how various regulations are enforced (through having a more liberal interpretation of the law). This is when a company will have the ability to: increase their profit margins and they can start hiring once again. A good example of this can be seen with Ronald Regan saying how the government overregulated business during the 1980 election. As he felt, that if you can reduce the number of restrictions on businesses that this will improve their ability to compete (which will lead to an improvement in economic activity). This is exactly what happened in the early 1980's when his administration reduced a host of: financial, safety and environmental regulations. This helped the economy to improve with the unemployment rate dropping over the course of 8 years (Miroff, 2009, pp. 34 -- 35).
However, many critics will claim that these kinds of actions will often lead to an increase in the kinds of risks that firms are taking. Once this occurs, is when they will argue that this can lead to increased amounts of threats that will have a negative impact on everyone. Once this takes place, it means that there will be long periods of stagflation. Evidence of this can be seen with the recent financial crisis and the elimination of the Glass Steagall Act in 1999. At the time, many banks claimed that this was an out of date law that prohibited their ability to compete. The reason why, is because it forbids financial institutions from becoming involved in a host of activities at the same time to include: banking, insurance, financial planning and brokerage services. This made it difficult for American companies to compete against foreign firms that were not limited by these laws. Once the act was repealed, banks became large conglomerates that sold a variety of products. In 2007, the lack of oversight increased the risks to the financial system with many banks becoming too big to fail. This is significant, because it is showing the continuous debate about how much regulation in necessary of businesses. To determine this we will examine: the current relationship between the government / private firms, a public policy goal of citizens, the value of these laws to consumers, if corporations have political strategies and what recommendations could be used to reduce these risks. Together, these different elements will provide the greatest insights as to the role regulations play in the relationship between government and businesses (Bonnick, 2010, pp. 5 -- 10).
Describe the current relationship between government and business in the United States.
The current relationship between the government and business is one of increasing regulations. Where, a series of different laws are being enacted to protect the interests of the general public. This is because there has been an outcry about how the lack of oversight is contributing to abuses of system during the recent financial crisis. While at the same time, various firms have been pushing to limit the language and policies about how these laws are being enforced.
A good example of this can be seen with the Dodd Frank Act. In the aftermath of the financial crisis,...
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