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Government funded programs, such as the subsidy program, are largely funded by taxpayer...

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sj83 | (Level 1) Valedictorian

Posted July 28, 2013 at 12:02 AM via web

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Government funded programs, such as the subsidy program, are largely funded by taxpayer dollars.  When individuals and businesses pay taxes, it increases government revenues which are spent for things like this.  Do you think the benefit of tax cuts to consumers (more money in their pockets to spend and help grow the economy) outweigh the benefits of the government programs?

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

Posted July 28, 2013 at 12:52 AM (Answer #1)

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This is, of course, a matter of opinion.  My own opinion is that these programs are not worth it.  It would be better for the economy as a whole, and for consumers, if there were fewer subsidy programs.

The problem with subsidies is that the prevent consumers from doing what they want to with their money.  These programs take the money from consumers in the form of taxes and then dole it out to the various industries that are subsidized.  This does not allow the consumers to spend their money as they would like.

In a better system, there would be fewer subsidies.  People would get to keep their money and then would spend it on the things that they wanted.  The prices for those items would increase, to be sure.  However, the prices would be borne by those who actually wanted the items being sold.  This would be more efficient because people who did not want things would not be required to pay for the things that they did not want.

Getting rid of subsidies would raise prices for some, but it would be more efficient for the economy as a whole.

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