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CHAPTER THREE: What Government Does - And How It Does It/h1>

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Chapter Summary

Chapter 3 examines what government does and how it works. Many of the public's fears about government are based on misunderstandings about the nature of governmental activity. Different levels of government concentrate on different kinds of services. During the last four decades, the federal government has doubled spending on entitlements (i.e., Medicare) while cutting defense spending by more than half. On the other hand, state governments have remained functionally consistent in financing welfare, higher education, and highways in addition to receiving and administering federal grants. Local government of all shapes and sizes concentrates far more on the direct delivery of services than does government at other levels. Government has grown fastest at the state and local levels.

Government can be viewed as a collection of two types of basic tools. Direct tools provide goods and services, such as police and fire protection. Indirect tools, which are increasing in use, include contracts with nongovernmental partners to help implement government programs; grants to encourage other levels of government to undertake responsibilities they might not otherwise; regulations to expand government's power; tax expenditures to give taxpayers special advantages in paying their taxes; and loan programs to allow individuals and private organizations to borrow private money to pursue projects in the public's interest. The implications for the field of public administration include the following: the job of government varies by level, the job of government varies by function, and the job of government varies by who finally provides the goods and services.