Section 1: The Role of Government
Free enterprise is the freedom of individuals and businesses to operate and compete with a minimum of government interference or regulation. In order to encourage competition and prevent monopolies, governments take steps to regulate economies.
Section 2: Measuring the Economy
An economic system is the way a society organizes the production and consumption of goods and services. Our government plays a limited, but important, role in measuring and trying to balance the alternating periods of growth and decline called the business cycle.
Section 3: Government, the Economy, and You
People form governments to establish order, provide security, and accomplish common goals. A major focus of government programs is to help people in poverty.

Section 1: Types of Businesses
Market economies rest upon the fundamental principle of individual freedom for consumers, producers, and workers. The three basic types of business organizations in the United States are sole proprietorship, partnership, and corporation.
Section 2: The American Labor Force
Market economies rest upon the fundamental principle of individual freedom for consumers, producers, and workers. Labor unions represent about 14 percent of U.S. workers and play an important role in the nation’s economy and political life. They negotiate wages and workplace agreements with management.
Section 3: Businesses in Our Economy
Market economies rest upon the fundamental principle of individual freedom for consumers, producers, and workers. Businesses play many different roles in our economy, including that of consumer, employer, and producer. Businesses also have responsibilities to their consumers, owners, employees, and communities.

Two forces work together in markets to establish

prices for all the goods and services we buy. They are

demand—the desire, willingness, and ability to buy

a good or service, and supply—the quantities of a

good or service that producers are willing to sell at all

possible market prices.

Whatever goals or dreams you may have, the way you live your life will be determined, at least in part, by your relationship to money: how you get it and how you use it. The opportunities you create for yourself are greatly affected by the money habits you form when you are young.

An economic system is a set of rules that governs what goods and services to produce, how to produce them, and for whom they are produced. In this chapter, you will learn how the economic system of the United States answers these questions.

As American citizens, we live in a land of economic opportunity. Our economy provides us with a great variety of jobs, goods, and services. The United States has a free enterprise system under which consumers and producers make the major economic decisions. We can contribute to the nation’s economic success by taking advantage of economic opportunities.

In a democracy, citizens must be willing to take part in civic life. The Internet increases the opportunities to do just that. Accessing the Internet promises to strengthen democracy, but it may also present serious challenges to democracy.

When is a legal issue a criminal problem, and when is it a civil problem? Civil law concerns disputes between two or more individuals or between individuals and the government. In criminal law, by contrast, the government charges someone with a crime and is always the prosecutor.

The Constitution and the Bill of Rights contain important provisions, or laws, safeguarding the rights of Americans. In return, our system of laws gives American citizens a number of responsibilities.

Local governments are the governments closest and most accessible to you. They provide citizens with basic services such as education; fire and police protection; and water, sewage, and sanitation.

In America, different groups of people hold many different viewpoints. Some groups form to try to persuade government officials to support their views. These groups are exercising the important rights of freedom of speech and assembly.

The right to vote is a major responsibility of citizenship. By voting, citizens can influence all levels of government as well as the laws under which we live. Yet many Americans do not exercise this fundamental right and responsibility of our democratic way of life.

The Constitution makes no mention of political parties, but the first ones formed during the early years of the republic. Today, the United States has several political parties, although two—the Democrats and the Republicans—dominate American politics.

What would our country be without a judicial system or a way of enforcing our laws? The courts see to it that our nation’s laws are justly applied. They also interpret the laws that protect the rights the Constitution guarantees. As you read this chapter, think about how the federal court system developed.

The Framers did not state specifically in the Constitution what the role of the president should be. The nation’s first president, George Washington, established many traditions that shaped the presidency. Every president since Washington has followed and built upon these traditions, refining the president’s role within the government.

Our nation’s Constitution gives the power to make laws to the legislative branch. Citizens participate in the lawmaking process by expressing their views to Congress. Find out what legislation is pending in Congress and your representatives’ positions on the issues.

As citizens, we are free to exercise our rights. In return we are expected to fulfill certain duties and responsibilities. By doing so, we help ensure that our government will be effective in serving our needs and protecting our rights.

Americans have the right to speak out on issues and make their feelings known. The Bill of Rights—the first 10 amendments to the U.S. Constitution—guarantees certain basic rights to all Americans. Among the most important is freedom of speech. It guarantees that people will not be punished for stating their beliefs even if most people disagree with those beliefs. 

The Constitution outlines the ideals of American government and describes how they should be achieved. It tells you what your rights and privileges are. The Constitution affects you, your family, and your friends as much today as it affected those who wrote it more than 200 years ago. 

For American History 2: Modern American History