ABSTRACT
The government of the United States, like most national governments, undertakes many activities that affect both the size and the distribution of the nation's income. This chapter discusses the tax and spending policies of the federal government and of state and local jurisdictions as they affect families at different income levels. It outlines that it is by no means a simple matter to trace through and distinguish between all the various impacts that different government programs and agencies may have on the economic well-being of American families. The chapter also discusses specific tax and expenditure programs and their impacts, and considers the major conceptual problems involved in allocating the costs and benefits associated with taxes and expenditure programs in general. It examines the redistributive role of government programs, looking first at the tax system and then at public expenditures. The chapter also considers particularly the role of the government in alleviating poverty in the United States.
