about the economy ...?

Question

When and why did government intervention in the economy increase substantially? What has been the overall effect?

Answer 1

Patronising socialists is the answer. The year was 1997. However money is best in the hands of its citizens/subjects. - Control Economies think they can anticipate the needs of the individual better than the man on the street - they can't - such economies are better in some very limited circumstances - like a World War but generally this is not the case. The Soviet Union proved this - it did not work and collapsed. The primary reason for this is that people are not incentivised to work and innovate if the government turns around and takes too high a proportion of the wealth generated.

This does not mean that economies should not be regulated - limits do have to be set AROUND human behaviour - Labour however doesn't understand this - they think they know better. This is pretty laughable considering what a bunch of halfwits they are. An overly prescriptive government is a recipe for disaster. It builds up a culture of non-compliance with the law, which is unsurprising if regulation and lawmaking create a framework nobody can understand. The British experience of the last ten years has proved this.

Answer 2

Governments always have a large influence on their respective economies. They collect tax revenue and spend it - thereby redistributing wealth. In the US, the Federal Government took on a larger role in influencing our economy during the Great Depression - it became much more involved in economic monitoring and control (e.g. Federal Reserve Board) and in providing a "safety net" (e.g. Social Security). The involvement of government in the economy is basically the mixing of politics and a lot of money. There is always the potential for abuse.