Government workers and government consumption

Office workGovernments at the federal, state, and local levels are all great consumers of products and resources. Governments pay for their obvious expenses, like office supplies, electricity, and employees’ wages. State and local governments spend money on road and bridge construction and repair, which require the purchase of cement, asphalt, steel, and other materials. They pay for the building and maintenance of police and fire stations, schools, hospitals, and nursing homes as well as staff salaries and the equipment and supplies used there.

They also spend money on environmental projects, such as wastewater treatment plants and harbor improvements. The building and maintenance of parks and recreational facilities is a spending category that communities favor. The grounds keeping departments of state and local governments purchase about one sixth of the lawn and garden equipment sold in the United States.

The federal government has many similar expenses. It too supports hospitals, law enforcement, and parks. But it also has many other expenses. The Defense Department alone spends money not only on airplanes, ships, army vehicles, and weapons but also on numerous other things. Its construction costs include housing for military personnel, storage facilities for weapons, airfields and hangars. Providing food services for military personnel is a great expense.

One of the Defense Departments important expenses is developing and maintaining new communications and weapons systems. This requires contracting science and engineering firms that can do the job. The Department of Energy also supports a great deal of research. It spends money on laboratories like Fermilab and Brookhaven National Lab that have specialized equipment that enable scientists to do advanced research in physics, chemistry, biology, medicine, energy, and environmental science. The Department of Education also funds research, sets up summer workshops for teachers, and distributes teaching resources. Other departments have multiple expenses as well.



One way parents and other donors can invest money for their children is by opening a Uniform Gifts to Minors Act (UGMA) account. In some states, it is called the Uniform Transfers to Minors Act. A UGMA account is a trust in which the money is owned by the minor, but is managed by an adult “custodian” until the minor reaches 18 or 21 years of age, depending on the state. UGMA accounts can be opened through banks, stockbrokers, and mutual funds. Although taxes must be paid on the interest earned by these accounts, minors pay a lower rate than their parents would. Therefore, many parents consider UGMA accounts a good way to save for major expenses, such as their children’s college education.


  • Kamlet, Art, et al. “Tax Code-Uniform Gifts to Minors Act (UGMA).” The Investment FAQ. (accessed May 16, 2008).

U.S. consumer price index

The Consumer Price Index is compiled by the Bureau of Labor Statistics (BLS). The BLS has data collectors across the United States whose job is to gather information about the goods and services listed in the CPI. They visit or call service providers, apartment managers, and retail stores and record the cost of the goods and services sold there. If an item is no longer available, data collectors may choose a substitute item. Data collectors also note changes in price, quality, or quantity by which a product is sold. The information is then sent to the BLS national office where it is analyzed and adjustments are made when calculating the CPI.


One Comment

  1. elena says:

    this was great !!!