The document discusses different perspectives on the role of government intervention in economic distress. It argues that while individuals and the free market play an important role, complete reliance on them will not alleviate issues like unemployment, so limited government intervention is also needed. A mixed economy allows both groups to contribute in recovery by regulating aspects individuals cannot and giving them freedom of choice. The Polder Model of cooperation between government, employers and unions in the Netherlands is given as an successful example of this approach.

1. Jamie Bell
January 2011
A Cure to Economic Distress
Economics, it may be argued, can be reduced to the study of how individuals in
societies meet their needs and wants. The source makes reference to the author’s opinion
about the appropriateness during times of depression. Liberalism, as an economic ideology,
offers many options for citizens and governments in terms of dealing with periods of
economic distress. On one hand individuals who ideology favours the right side of the
political spectrum, like Adam Smith, believe the government does not have a role to play in
the economy even during times of distress. Classical liberals believe if producers focus on
making individual profit they will unintentionally benefit the consumers. On the other hand
individuals whose ideology reflects the left side of the political spectrum believe the
government needs to have a direct role in the economy because they have the power to
create more social programs to generate more jobs to decrease unemployment and cut
taxes in order to relieve some of the pressure on the individuals. When faced with the
question concerning to what degree the perspective of the source should be embraced one
might argue that we should partially embrace the source because individuals need to be a
part of fixing the economy by spending money and producing and consuming goods.
However there still needs to be some government involvement to regulate and help control
what the individuals cannot.
Some may argue that complete government interventions is the only option to deal
with the periods of economic distress. They feel government needs to have a direct role in
the market because the government has the power to develop more social programs or