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Government should maintain law and order, protect civil liberties, and guarantee public safety using police forces and an armed force to repel an attack from abroad.

People, power, and policy People (component of government) Elected officials with authority and control over others; public servants who carry out day-to-day governmental business Power (component of government) Includes legislative, executive, and judicial branches Policy (component of government)

Friedman states that the basic essential functions of government are to: (1) to defend the nation from coercion from the outside and to defend individuals from coercion by others within the country; (2) to enable the free market by establishing exchange rules and by providing the medium of exchange; and (3) to respond to neighbourhood effects.

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