Question

Typically, the Republican Party advocates for a smaller role of the government in our free market system, whereas the Democratic Party advocates for a larger role of the government in the economy. Choose and support one party’s policy position and provide a rationale for doing so.

Answer 1

In my opinion, the Democratic party is right in their view of a larger role of government in the economy. This is because if the economy is left to the hands of free market forces of demand and supply, then prices will be determined such that only the well-off people will be able to afford the comoodities. There will be no price ceilings and price floors in order to enable affordability to the poor. Moreover, social investments which require long gestation periods for returns will not be built as it will not be benficial for the private firms to invest in these projects.

Basic economic infrastructural activities and subsidies provided by the government on certain activities (like railway is a government owned monopoly subsidized by the government for the benefit of the people in India) will not take place.