Topic 12: Role of the Government

Everyone wants to get rich. Economic boom is the thing they want it happen in their countries. But they always forgot an important thing, business cycle. There are four stages of the cycle and the stage everyones want the economic in their country at stage two: Peak. As the peak go really high, the third stage will come. Stock price starts falling, the boom becomes ashes, everything is gone. I think government should take a little bit of control of economic so they can cool down the economic in their country to stop another economic tragedy in their country. There's a real historic economic tragedy happened n 1929 of America. It's called the Great Depression. The Great Depression happened because the stock buyers were guessing when would the stock price is going up. However, those predictions were wrong ad the stock market crashed, everyone was broke in a minute. During that time, the government believed in a theory call lassiez fair, it means "hands off" policy: the government shouldn't involve the businesses so those businesses will be good. After the Great Depression happened, the government still didn't have any action to help because the government still believed "hands off" policy. The unemployment rate grew to 25%, that means there are 1 out of 4 people doesn't have a job. After FDR became president, he directly help the society and the society got better. As we can see through the history, I think the government should involve and sometimes cool down the business with raising taxes so this kind of tragedy won't happen again.