Chapter 16 focuses on how the government supports many of the services we take for granted and fosters many of the economic advantages we seek. Section 1 describes the measurements of government growth, explores why government has grown so rapidly since the Great Depression, and examines whether the growth of government is good or bad for society.

Purpose of Government
Section 2 describes the general purpose of government as being threefold: to protect individual rights, to promote a stable legal environment for economic activity, and to promote policies that support the general well being of all citizens. Government tries to accomplish its purpose in four ways: providing public goods, redistributing income, regulating economic activity, and ensuring economic stability. The section defines public goods and explains social insurance and public-assistance programs in the United States. The section also explains four ways that government regulates the economy and two ways that government promotes economic stability. Section 2 concludes with a discussion about the criticisms of government involvement in the United States' economy.

The Federal Budget and Taxation
Section 3 analyzes the steps in the federal budget-making process and explains how deficit spending increases the national debt. The section also describes various attempts that government has made to reduce the deficit and shows circle graphs of federal, state, and local spending in a recent year. Section 4 explains the principles and types of taxation, and describes how taxes are used.