In a true free market economy the government does not own any businesses and does not interfere with businesses in the forms of taxes and regulations. Since the government does not take in taxes from businesses or consumers, they also do not provide citizens with public s

ervices. Services such as health care, education, old age pensions, day cares, maternity/paternity paid leave from work, unemployment insurance, disability insurance and many others are not provided by the government. All of these services are provided by private businesses. Supporters of the free market economy believe that government intervention in business in unnecessary. Consumers and producers agree upon regulations, safety standards and even minimum wage. For example if consumers in significant numbers would rather buy a cheaper car that does not have air bags than a car that does have air bags then the producers will produce cars without airbags. Even though the products may not be as safe or reliable if there is consumer demand then producers will make supply. The price of goods is determined by an agreement between the producer and consumer. The producers produce a certain supply of goods that they think the consumer will buy. The consumer will buy a great deal of goods if they are very cheap and will not buy very much if they are very expensive. Using supply and demand companies and consumers agree on a middle price or equilibrium price. The United States is considered a private enterprise economy, the government owns very few businesses such as the post office, a quarter or the electric companies, and a quarter of the railways. Also, the United States government does not provide health care for its citizens. The free market society is set up so that production decisions are influenced entirely by consumer demand. This is not always best because consumers do not always demand the highest quality products in favor of cheaper ones. The biggest problem in free market economies is the relative ease and opportunity for businesses to form monopolies and oligopolies. When businesses form monopolies and oligopolies they can control the price of goods completely because there are no competitive businesses to keep them in check. This provides unfair quality and price controls for consumers.

A mixed economy is any economy in between the two extremes. Every economy in the world today is technically a mixed economy. The ideal mixed economy would have the essential social security programs with minimal taxes. These essential social security programs would be health care including dentistry and optometry, disability insurance, and unemployment insurance. There can and should be progressive taxation in an economy. This means that a higher percentage of tax is taken from those who make more money and the very poor pay no tax or close to no tax. Certain industries should be owned and controlled by the government, those industries that are essential to society such as schools, hospitals, electricity, gas, telecommunications, public safety, security, complete education including post-secondary, defense, rescue, and the post office. Industries such as transportation, manufacturing industries and industries for harvesting natural resources should be privately owned. If the government owns an industry it should be a government owned monopoly, this way the government does not compete with privately owned businesses. If the government does compete with privately owned businesses it is unfair competition because the government has more than enough capital to fund any advances and needed expenses for its businesses giving it an unfair advantage over private businesses. If key businesses such as the airlines or manufacturing industries are going bankrupt the government should help them out but only for a limited time such as six months. If the business is not making profit in six months then the government stops providing financial support. If the government buys failing businesses there is a large chance that they will just become a financial drain on the government so therefore the government should not buy failing business or provide support for over six months. A mixed economy can provide a middle ground between government decisions and

Some common words found in the essay are:
, mixed economy, consumer demand, economy government, production decisions, centrally planned, free market, centrally planned economy, planned economy, health care, government owns, health insurance, free market economy, planned economy government, provide middle ground, middle ground government,
Approximate Word count = 3275
Approximate Pages = 13 (250 words per page double spaced)