Final answer:
True. The statement that Bismarckian nations use government-set prices to control health care costs is true, reflecting Bismarck's welfare state model. In contrast to the U.S.
Step-by-step explanation:
The statement that Bismarck nations control costs through government-set prices for care is true. Otto von Bismarck, the first Chancellor of Germany, pioneered the model of welfare state known as the Bismarck Model. Under this system, the government plays a significant role in health care, including setting prices for medical services to control health care costs. This is in contrast to a purely free-market approach, where prices are determined by supply and demand. Bismarck's social legislation has long been considered a precursor to modern social welfare programs.
Focusing on the provided reference information, we can correct some misconceptions regarding the U.S. federal spending and taxation system:
- Federal spending has increased in nominal dollars but not necessarily as a share of GDP.
- The U.S. government does not control a relatively large share of the economy by world standards.
- A majority of federal revenue comes from personal income taxes.
- Education spending is significantly higher at the state level than the federal level.
- State and local government spending as a share of GDP has increased over time.
- Current defense spending is not higher than it has ever been either as a share of GDP or in real dollars.
- The share of the economy going to federal taxes has not increased substantially over time.
- Foreign aid constitutes a small portion of federal spending.