Government & Policy

Governments can have an enormous impact on the economy. Learn how the government affects taxes, trade, markets, interest rates, and more through policy, regulation, and legislation.

Frequently Asked Questions
  • How does the government control inflation?

    The most common way governments control inflation is by raising or lowering interest rates. Put simply, high interest rates counter inflation by reducing the money supply, and low interest rates promote inflation by increasing the money supply. In the U.S., the Federal Reserve indirectly controls interest rates through the federal funds rate, the interest rate banks charge each other for loans made overnight.

  • What is the difference between communism and socialism?

    Communism and socialism both advocate for a more equitable distribution of wealth than that achieved under capitalism, but they differ in their means and the extremity of their vision. A basic premise of communism is that a communist order is achieved through a revolution in which the working class (proletariat) overthrows the ruling class (bourgeoisie). Socialism insists on working within existing systems to implement reform. Communism also advocates the dissolution of all private property so that all property is owned by the state, which distributes resources evenly between citizens. Under socialism, the means of accumulating wealth (industry and commerce) are collectively-owned and managed by the government, but property like homes and personal possessions can remain privately-owned.

  • How much does the U.S. spend on healthcare?

    According to Centers for Medicare & Medicaid Services, U.S. healthcare spending is expected to reach $6.2 trillion, or 20% of GDP, by 2028. In 2020, spending per person was $12,530, the highest of any developed country. Norway, which ranked second in terms of healthcare costs, spent $6,748 per person, almost half of U.S. expenditures.

  • What is the difference between monetary policy and fiscal policy?

    Monetary policy refers to the actions taken by a central bank to achieve economic goals like low unemployment and stable prices. Monetary policy is often executed through the increase or decrease of the money supply. Fiscal policy refers to the government’s tax and spending plans. Fiscal policy is administered by the legislative and executive branches of government.

Key Terms

Explore Government & Policy

same-sex marriage supporter waves a pride flag
Firsts for American LGBTQ+ People
Gas shortage sign
1973 Energy Crisis
NATO Summit
North Atlantic Treaty Organization (NATO)
U.S. Trade Representative Katherine Tai
U.S. Trade Representative (USTR)
Apartment buildings
What Is a Housing Trust Fund (HTF)?
Margaret Thatcher
Who Was Margaret Thatcher?
Outside observers are wondering whether Russia’s downward economic spiral can shake Vladimir Putin’s hold on power.
Oligarch
A child care center with an adult and kids seated on the floor and involved in projects.
Community Development Block Grant (CDBG)
Juneteenth Memorial Monument at the George Washington Carver Museum in Austin, Texas
Juneteenth
The US Federal Trade Commission (FTC) bu
COVID-19 scammers put on notice by the FTC—Issued Cease-and-Desist Orders
Emancipation Day
Emancipation Day
Woman demonstrating for equal pay in Cincinnati
Equal Pay Act of 1963
Older woman using a flip phone.
The Lifeline Program Helps Low-Income Consumers Get Phone and Internet
Food Stamp/SNAP Participation Grows
What Is Social Insurance?
Road Sign Against Bridge and Sky in City
What’s in the Infrastructure Investment and Jobs Act?
Corner of building with word "BANK" on it
Bank Merger Review Modernization Act
Security officer checking computer equipment
What is the Technology Modernization Fund (TMF)?
Emissions from the smokestack of a natural gas and coal power plant that are harmful to the atmosphere
Biden's Proposals to Fight Emergencies and Climate Change
Low-income senior housing
Community Land Trust
A screenshot of Facebook.com.
What is Section 230?
SNAP
SNAP Benefits by State
Alexander Hamilton
Who Was Alexander Hamilton?
Medical bills, stethoscope, pen
Surprise Medical Billing: Now Illegal Under the No Surprises Act
Four women sit around a conference table, holding a work meeting.
Paycheck Fairness Act and What It Could Mean for You
A renter sits on a couch texting, surrounded by open cardboard boxes in his new apartment
Rent Stabilization Definition
The Women of the Women's Policy Union of New York State heading to New Jersey on a rented tugboat to encourage voting rights for women
Milestones in Gender Equality
Supplemental Nutrition Assistance Program logo
Supplemental Nutrition Assistance Program (SNAP)
Overhead view of colorful freight train boxcars and flatbeds in a rail yard beside a parking lot.
Surface Transportation Board (STB)
Black multigeneration family sitting at a table and counting coins
Contract Buyers League
A cargo ship in the water carrying containers with a smaller tug boat on the side.
Federal Maritime Commission (FMC)
Tired new mother holding her baby
Women, Infants, and Children Nutrition Program (WIC)
Suburban American street with three houses of various revival stylings close together and close to the sidewalk
How Single-Family Zoning Contributes to Racial Inequality
Close-up of old-fashioned rotary-dial telephone
Universal Service Fund
Aerial view of park and bridge
Understanding the Recent Infrastructure Legislation
U.S. Capitol Building
Who Are the Richest U.S. Senators?
Navy Engineman
The SCRA offers financial protection for active-duty service members.
Telephone poles along US Route 64 in Arkansas.
Rural Electrification Act
President Biden at microphone in front of an American flag
What’s in Biden’s Executive Order Promoting Economic Competition?
Tropical beach background as summer landscape with beach swing or hammock and white sand and calm sea for beach banner. Perfect beach scene vacation and summer holiday concept.
Countries Offering Digital Nomad Visas
Screenshot of a Google Books search for The Elephant in the Brain
Should Google Be Classified as a Public Utility?
Senate Commerce Committee Considers Nominees For NASA Administrator And Federal Trade Commissioner
Who Is Lina Khan?
US Constitution with scales of justice and gavel
Legal Milestones That Fight Income Inequality
Masked woman on ventilator, with two medical workers in full pandemic PPE
Defense Production Act (DPA)
A doctor examines a child with a stethoscope.
Strategies for Containing U.S. Healthcare Costs
The Black Wall Street Massacre memorial is shown on June 18, 2020, in Tulsa, Okla.
What Was the Tulsa Race Massacre?
Image
LGBTQ+ Representation in the Workforce
A woman meets with her healthcare provider via her laptop.
Telehealth Definition
African American family playing board game together
What's in Biden's American Families Plan?
Unemployment rates
LGBTQ+ Pay Gap and Unemployment
Homeless person sitting on city sidewalk, asking for money
Baby Bonds and Intergenerational Wealth Inequality
Kamala Harris being sworn in as vice president of the United States
Firsts for American Women
Judge Eileen Kato of Seattle in courtroom
Minority Groups—Largely Underrepresented in the U.S. Judicial System
EEOC Logo
How To Request FOIA Information from the EEOC
New York City Mayor Bill de Blasio and NYPD Commissioner William J. Bratton being briefed on Emergency Service Unit Equipment involving a robot.
What Does the Data Say About American Police Spending?
Politicians talking in government building
Government Leadership by Race
Protesters at a demonstration in support of transgender youth.
How Gender Expression Affects Income
Man and woman dressed in formal business attire collaborating
Comparable Worth Definition
The word and definition of "Discrimination" highlighted in a blue-toned image.
Disparate impact and Antidiscrimination Law
Vice President Kamala Harris with a black mask on, hand over her heart
Government Leadership by Gender
Yale School of Management gathering for 2018 commencement procession
Academic Leadership by Race