Business, Government and Workers Ch:21

1. Business, Government and Workers Ch:21 • Business produce, make profits and grow • Governments provide their laws and ours • Market economy produce when profitable • Capitalist vs Communist • Capitalist is free markets and freedom to make as much money as possible. Gov minimal control • Communist: More government ownership and control. In theory wealth is shared evenly. In practice, greed wins out. • Role of Government Protects people and business by laws • Supports public and business by grants

2. Quests • Communist versus Capitalist? • Role of government?

3. Market economy failures V Gov remedies • Business • Will not create anything without profit • Don’t worry choices, prices + Fire people • Government • Bus and rail • Libraries, art galleries and parks • Environment protection laws • Competition authority to monitor business • try to increase jobs and standard of living

4. Q • Business v government?

5. Government Structure • Local • County councils, city corporations and urban district councils • Central • Dail(TD’s): revenue and spending,new laws • Seanad(Uni senators + C.C): Approve laws • President signs it into law

6. Government Spending and Revenue • The yearly budget is where finance minister outlines planned targets of S and R. • Current revenue budget: • 4 taxes and borrowing • Current spending budget: • civil service jobs, debt interest, social welfare, health, education, pensions, grants

7. Structure? • Spending?

8. Fiscal Policy and PPF • Capital spending • infrastructure for traffic, I.T, broadband etc.. • Capital revenue comes from borrowing • Fiscal Policy: • How government plans to make and spend • low corp tax, MS, Inflation,interest, infrastructure • Programme for prosperity and fairness • national wage agreements

9. Whats fiscal policy? • PPF?

10. Local Government role • Provides • For public Business • suitable land Housing for workers • housing Drainage and Sewage • waste disposal Infrastructure • roads Enterprise boards • harbours

11. Impact of Economy on business • Good economy, business does well, economic growth • Economy well being is determined by • employment • interest rates • inflation • exchange rates • Taxation • Political vision, control and laws

12. Q • How does local gov help us? • …. Businesses?

13. Unemployment • Over 430,000 currently unemployed • Less workers less taxes, taxes go up • less taxes less money for spending • Grants attract foreign business • Taxation: (good if cty can afford to reduce) • lower tax encourage people to work • less money for spending • prsi paid by firm and workers insures workers • Carbon taxes can help environment

14. Interest rates and Inflation • Interest rates • A) bank money saved B) loans to people and business • When interest rates are low people can borrow more cheaply. Europe banks gave Ireland cheap rates on loans. Our banks gave out 100% mortgages and large cheap loans to property developers. Property bubble was increased by government tax incentives and it then burst around 2008 and was the main cause of our current economic crash. • When high people save there money • Inflation is the price of goods and services • wages may increase when inflation increases

15. Exchange rates • The value of a country's money. • When low your cty can sell goods cheaper and attract tourists • When high your exports are over priced • Visa versa for imports • When you buy imports, by converting our currency into foreign currency it devalues our own currency. The bought foreign will increase

16. Impact of business on economy • (+) • Employment, greater wealth, sponsorship • tax, other firms benefit, raw materials bought • (-) • raise prices, pollution, redundancies

17. Q • Taxes • Interest? • Inflation? • Exchange rates?

18. Conclusion • Business will produce when profitable, government provides the laws and business supports for jobs and public amenities. • Communist china more government influence in business than in capitalist Ireland. • There is local and Central Government. CG plan budget and fiscal policies. • CG controls economy by interest rates (ECB), inflation (competition), value of euro, taxation and policical vision.

19. Quests?? • Explain business, government roles and the market economy • Failures of market economies/remedies • Outline government structure • Types of government spending and revenue • Partnership for P and F? Local government? • Economy is made up of? Inflation …... • Exchange rates and impact of business on economies and fiscal policy?????