IntroductionWhat is the role of the federal government in the American economy? What should it be? Although based largely on the concept of free enterprise, and organizing economic activity through open and competitive markets, the U.S. economy also has a tradition of government intervention for specific economic purposes -- including limiting monopoly, protecting the consumer, providing for the poor, handicapped and elderly, and preserving the environment.
Government intervention in the U.S. economy began increasing rapidly following the Great Depression of the 1930s, and continued to grow through the 1960s and into the 1970s. But beginning in the late 1970s, a large number of Americans began questioning the usefulness of what they considered excessive government regulation. By the 1980s, this increasing controversy had brought about partial deregulation of several industries including telecommunications, the airlines and the railroads. But in the early 1990s the costs and benefits of the deregulation of these industries were still being debated, while for other industries there was concern over the possible need for increased regulation.