Scott Sumner  

Government brings out the worst in us

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Paul Krugman doesn't understand why people think government is bad:

Why, exactly, are these public functions unquestioned bywords for "something bad"?

Maybe I'm living a sheltered life here in central New Jersey, but I don't find the Post Office a terrible experience -- no worse than Fedex or UPS. (Full disclosure: I worked as a temp mailman when in college.) And nobody likes going to the DMV, but the one on Rt. 1 I go to always seems fairly well managed.

And in general: is dealing with these government agencies any worse than, say, dealing with the cable company?

The prejudice against government seems to have become free-floating, unattached to any actual experience.


From my perspective, that's the most eyebrow-raising post I've ever seen Krugman write. It's so at variance with my own personal experience as to leave me almost speechless. Yes, dealing with the cable company can be a bit frustrating, but you can argue with them over the phone without the employee losing their temper. If you so much as raise an eyebrow to a TSA agent, they can and will make you miss your flight (I speak from personal experience.) There is simply no comparison. I thought about Krugman's column the other day when I took my daughter in for her learner permit test. She asked why the lines were so long, even before the DMV office had opened (BTW, at 10am--what's that about?)

Screen Shot 2015-07-09 at 11.32.24 AM.png
(The line was even longer; I cropped out people looking at the camera, for privacy reasons.)
I told my daughter that government offices don't have to compete for customers as private companies do, so they don't care very much about customer relations. Of course some private monopolies suffer from the same problem.

After she passed her written exam, she said she noticed that government employees were really mean. This is a sixteen-year-old girl who 1 hour earlier barely understood the difference between the private and public sector, a difference that some Nobel Prize winners still have not noticed. Or maybe it's just her "free-floating prejudice." What do you think? In my view most people find their jobs frustrating, and will take it out on strangers unless competition forces them to be polite.

In places like Russia and China, where government dominated all sectors of the economy for generations, people became naturally suspicious. You approached a counter expecting someone on the other side to be your enemy, to do whatever they could to frustrate your day. The US is much better, but we still see this in the government sector.

Earlier this month my wife got a ticket for parking on a street where you could only park on weekends and holidays. July 3 was a day when my wife didn't have to work, the Federal government was closed, the stock market was closed, and even our town government was closed. But even though Newton Town Hall considered it a holiday and was closed, Newton Parking Enforcement did not, as their meter maids had to work that day. Just imagine if you are a meter maid forced to work on what everyone else thinks is a holiday. How would you "show them" your anger? Obviously enforce the letter of the law, not the spirit.

I told my wife to call the Newton Parking Clerk; any reasonable person would have viewed July 3rd as a holiday. Unfortunately, the Newton Parking Clerk is apparently not a reasonable person. Of course I'm half-joking here, public employees are just as reasonable as anyone else. It's the incentive structure that makes them behave the way they do. Meter maids and parking clerks don't have to worry about angering their customers.

Here's the obvious solution. Privatize the DMV by letting competing companies provide this service, and compensate them per customer at the current spending level of the government service. Since the private sector is far more efficient than the public sector, they can do this at far lower cost, and will compete for customers with better service, by getting rid of the long lines. The same idea has been shown to work with school vouchers, where private voucher schools can consistently produce the same crappy low achievement scores as the public schools, at a far lower cost per pupil.

In this fashion we could get rid of most of the government, and make America a far more polite country. Are there any core activities that the government must do? Probably, but I'm not sure which ones. In San Francisco a private police department has operated side by side with the city police for more than a century. (Behind Reason magazine paywall.) It does a better job at lower cost. Their police officers are more polite. And police work is one of those activities that even some libertarians regard as a core government function. Obviously the vast majority of things like schools, Post Office, TSA, FAA, toll roads, DMV, Amtrak, subways, etc., etc., would be even easier to privatize. There is very little that only government can do.

At the University of Chicago we were taught all sorts of mathematical proofs for the efficiency of the free market equilibrium. For me, the strongest argument for markets (which of course goes back to Adam Smith, and even earlier) is simple human decency. Government brings out the worst in us, and competition brings out the best in us.

PS. The Paul Krugman post was published before he moved from Princeton NJ, to New York City. It would be interesting to hear his view of government efficiency in a place that doesn't have as many competing suburbs nearby as Princeton.


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COMMENTS (45 to date)
Khodge writes:

As one who seldom gets frustrated by bureaucracy, I can see Professor K's point. The problem with government is not its visible aspects but with the hubris that comes from knowing you are unaccountable as an individual, manager, department, or, in most cases, politician.

Would USPS ever have developed overnight delivery without FedEx doing such a simple thing as creating a new delivery theory? (One which an educational bureaucrat could not understand.)

Would health "care" reform (actually health insurance regulation) have ever been an issue if the government had not been regulating it since the 60's?

Did government really help the domestic auto industry by nationalizing GM and Chrysler in the midst of a recession?

So many problems, yet all is good because the Rt 1 DMV has a manager who can actually manage.

Grant Gould writes:

Things must have improved immensely since the 90s at the Rt. 1 DMV for Krugman to be able to write that. When I got my license, I was in line there for three hours, the clerks looked one misplaced blink away from murdering the lot of us, and the driving tester told a steady stream of misogynistic jokes.

I am honestly delighted that things have improved enough for Krugman to write what he did, but perhaps his sense of scale and perspective needs adjustment.

John writes:

I agree with your general sentiment, but recently I've had much bigger problems with Comcast than with any government agency.

Mike writes:

Here in New Mexico, they did institute an option for private DMV offices several years ago. It's more expensive to go to them (they charge a fee in addition to the normal state-specified amount), but it's worth it for the much shorter wait time.

Ben Y writes:

Scott,

I read through this waiting for the very obvious comeback. Krugman compared a government monopoly to a private monopoly, cable companies.

Wondering why he didn't compare it to, say, Costco.

Adam writes:

It's telling that he didn't compare these agencies to a competitive business. The cable company suffers from the same problems as government agencies.

ThomasH writes:

While I agree that TSA would be better if privatized -- they would have some incentive to balance customer desire for convenience with safety -- and possibly DMV's, too, that's not what I hear from politicians who seem "anti public sector." It's like "regulation;" it's good or bad one regulation at a time and it seems sort of silly to stake out a position on the aggregate.

Personally, my experience with public bureaucracies -- even TSA and I fly a lot -- is more like Krugman's: not bad.

Is a Liberal a Conservative who got good service at the Post Office? :)

Mike W writes:

I don't see how your alternative of privatizing government services would work as competitively as you think. Wouldn't political influence become the basis for selection of the firms that would provide the services? Isn't that the rap against public employee unions?

And, certainly schools and the Postal Service could...and should...be privatized, but who would be the competitors for the TSA, FAA, toll roads, DMV, Amtrak, subways? How would they maintain their capacity while waiting for the next contract renewal?

And without a genuine competition element there doesn't seem to be any reason to believe a privatized service would be any less costly or more courteous than the government one.

Remember Ma Bell? An overpriced private sector bureaucracy with employees like Lily Tomlin's switchboard operator..."Because we're the phone company".

ThomasH writes:

On why Krugman did not compare government bureaucracies with private businesses. Activities do not become government bureaucracies or private firms in some sort of RCT process. One equilibrium of a having competing DMV's would be automatic issuing of licenses to everyone at near zero cost as would competing taxicab commissions. Haw good and idea this would be depends on what you think the entity should DO. It is somewhat disingenuous to discuss what activities should and should not be carried out by private firms or public bureaucracies as if it were just a matter of industrial organization.

Sieben writes:

My experience with USPS has always been that I get to wait in line for 45 minutes. No matter what time of day I go. UPS is a 2-5 minute affair. There's no comparison.

AntiSchiff writes:

Scott,

This is an uncharacteristically sloppy post from you. It's all about anecdotes, which would make it just as bad as Krugman's post, except that he was merely meaning to show that government didn't HAVE to do a bad job.

The DMV offices in Gainesville and Jacksonville Florida are far better run than the one you describe. In Gainesville, you walk in, take a number, have a seat, and are called her quickly. The people who work there are fine.

In Jacksonville, same thing, except the wait can be longer. But, you can check online ahead of time to see what the wait is like, or you can make an appointment. This is, by the way, far, far, far better than dealing with the crooks at Comcast of AT&T, who constantly put strange charges on my bill for simple internet access, after already charging me twice as much as people in other developed countries pay for about 100th the speed.

On the other hand, the experience at the post office here is usually terrible, but that wasn't the case in Gainesville.

I'll add that I've actually seen privatization up close on the workplace, with disastrous results. I worked at a campus for the developmentally disabled in Gainesville in 2003-2004 when a private company took over the HR department as part of "reforms" under Jeb Bush. They were supposed to migrate all HR records into a new computer system to increase efficiency, along with actually managing the department. Well, they never managed the department at all, so nothing changed that way, and all the HR records for the 3 years they had control of them were lost, never again to be found. There isn't even a record of me having worked there. This is a particular problem, when some of the employees fired over that period were fired for incompetently supervising residents or outright mistreating them. They ordinarily wouldn't be eligible for rehire. The company just to the money and ran. There was no accountability.

So, we can trade anecdotes, but one thing I can tell you for sure is that privatization is no panacea, and it's very naive to think that the same corrupt, idiot politicians who can't run anything themselves will privitize government functions in an honest or competent manner. If it's ultimately government money, there still has to be honest, competent oversight.

This is one of the reasons I utterly opposed privatization of prisons, for example.

R Richard Schweitzer writes:

Governments are monopolies.

Its "services" are monopolies.

Cable companies have monopolies.

The nearer a business model (particularly a service business) approaches a monopoly relationship with its "consumers, the more like governments its services (and products) will be.

Choice is an expression of liberty ( a sense of freedom) monopolies -especially by governments constrain (to the point of eliminate) choice; thus constrain liberty (and impair the sense of freedom) which otherwise free people hate like hell.

Would that answer him?

foosion writes:

There have been many budget cuts for government services, resulting in decreased levels of service. Amazing how that works. The IRS is currently a good example of this.

Consider the post office. There are severe restrictions on its business - it can't close rural locations, can't sell or leaseback properties and is forced to fund pensions at a level way beyond that required of any other business.

Governments have done lousy jobs of privatizing their services, often selling them at overly low prices or overly generous terms.

Look at some of the complaints about Comcast or TimeWarner cable. At least as bad to much worse than the complaints about the DMV.

For years Republicans have campaigned that government doesn't work well. Once in office, they set out to prove it.

Seth writes:

I don't think public v private is the right way to look at these things. I think it's more telling to see to what degree the system is bottom-up vs. top-down.

When I think of anecdotes, I've had poor service at many private enterprises and good service with public enterprises.

When I think in terms of percentages, I believe I get good service more often from those enterprises that operate in a more bottom-up system.

The few times I have interacted with my fire department offers a good example.

They were prompt, friendly and helpful. It is run by the local government -- likely in a top-down fashion.

However, fire departments, in general, operate in a bottom-up system since there are thousands of fire departments that operate independently of one another. Fire departments are not branches of some Federal Fire Authority.

This produces a lot of benefits. At some level, fire departments compete. If a city has a really bad fire department, that city may have a tough time attracting citizens and businesses. So, it's in the city's best interest to, at least, have a fire department that doesn't suck.

The thousands of fire departments also allows for widespread natural variation and experimentation in service delivery -- which is a good recipe for innovation that doesn't exist in top-down systems. If one fire department happens onto something that improves the service, other fire departments can adopt it if it makes sense for them or choose not to if it doesn't.

Scott Sumner writes:

John, Yes, government mandated private monopolies like Comcast also have that problem. But I find them more polite than the IRS, INS, etc. Comcast will at least try to answer your questions. (We actually have three cable providers in Newton now, so that may have helped.)

Mike, Of course the state DMV may have also had a tax subsidy.

Ben, Good point.

Thomas, You've been extremely lucky. How about the INS or the IRS? I've found them to be like a Kafkaesque nightmare. How about the police?

Mike, There is a private subway in Hong Kong, and it's very efficient, and profitable. There are private airports in Europe, let them do their own security control. There are private tollways all over the world. It's an increasing trend in the US. There are private railways in many countries. There are private DMVs. There are private FAAs in Europe.

Thomas, You said:

"It is somewhat disingenuous to discuss what activities should and should not be carried out by private firms or public bureaucracies as if it were just a matter of industrial organization."

That makes no sense to me. Surely there must be better arguments for government provision of services than "the service is required." Why should that impact who provides the service? Yes, we can also discuss what services people should be required to buy, but that's a different discussion from who should provide the service.

Richard, Comcast has much less monopoly power than many government monopolies. I can choose not to pay Comcast by getting satellite TV, or internet TV, or broadcast TV. My alternative to the DMV is not driving.

Scott Sumner writes:

Foosion, Was there a time before budget cuts when the IRS, TSA, INS, etc., etc., provided good service?

Seth, Of course fire houses provide good service; they have nothing else to do, and don't want the gravy train to end. With improvements in fire safety they have very little work to do, and so they do non-fire related tasks to seem useful, so their budget won't be cut.

Half of all firemen should be laid off.

To summarize, to right wingers like me the government seems rude and inefficient.

To left-wingers the government seems fine

And to non-ideological normal people like my daughter the government seems rude and inefficient.

There's bias somewhere, but I'm not quite sure where.

Scott Sumner writes:

Seth, I forgot to mention that Denmark has private fire protection--we should do the same.

Mike W writes:

"I told my daughter that government offices don't have to compete for customers as private companies do, so they don't care very much about customer relations."

"There is a private subway in Hong Kong, and it's very efficient, and profitable. There are private airports in Europe, let them do their own security control. There are private tollways all over the world. It's an increasing trend in the US. There are private railways in many countries. There are private DMVs. There are private FAAs in Europe."

But there is no competition in any of these examples. So what makes them more efficient and less costly than a government alternative?

Chris Wegener writes:

I have trouble believing you didn't make an appointment at the DMV. I recently received a parking ticket in San Diego where I parked wrong. I sent a polite letter with my payment and the town equally politely cancelled the ticket and refunded my payment.

I have always found that all of the front facing government employees I have had to interact with to be pleasant and helpful. (The only exception has been in the Virgin Islands where most government employees were unpleasant from the get go.)

The same issue exists within customer service employees from large corporations. If I am pleasant and patient I am treated well. Sadly, many people approach those tasked with dealing with the public badly and with hostility. As the people in that position are by and large powerless, resentment is the most likely response.

The contention that government is bad and business is good is by and large a self fulfilling prophecy. If you approach people with the predisposition that they are incompetent and worthless what you get back will not be friendliness. Expecting otherwise is foolishness.

Mike W writes:

Chris Wegener writes: I have trouble believing you didn't make an appointment at the DMV.

I wondered about that too. As well as, who goes to the DMV at all? My driver's license and registration are renewed online or through the mail.

In California kids are required to have six hours of behind-the-wheel training with a "professional" driving instructor...and high schools no longer provide Driver's Ed. As a result there is a network of driving schools that could be used to replace the DMV's driver testing function. (It certainly couldn't result in any worse drivers than those currently on the roads in California.)

The face-to-face operations of the DMV could be privatized and the remainder could be made a back office operation in Sacramento (or Delhi)...except that the DMV is a jobs program for low-skill workers, as is the Postal Service and the TSA. I suspect it is the nature of these employees has something to do with the quality of the service.

Pajser writes:

I did not experienced important difference as customer of public and private services. If anything, private services waste my time on marketing significantly more.

As a consumer, I don't deal with the capitalists. I deal with their employees. The employees are not motivated by number of consumers, they are motivated by orders of the owners of the company. Clearly, the capitalists will order their employees to be nice. The owner of the public companies is the nation. (Libertarians frequently stop the analysis with government and forget on the nation.) If nation thinks that employees should be nice - it will give the same order. Giving of the orders is more complicated - but it doesn't seem essential problem to me.

Essential advantage of public companies is that they can maximize sum of the profit and externalities while private services can only maximize the profit.

Scott Sumner writes:

Mike, The profit motive.

Chris, Interesting, but that has nothing at all to do with my experiences with the IRS, INS, TSA, etc. I always start out polite, and it doesn't work.

Mike, As I said in the post, my daughter needed a learners permit. In my state one has to take a test, in the DMV office.

Pajser, You said:

"If nation thinks that employees should be nice - it will give the same order."

Are you aware of the principal-agent problem?

Kailer writes:

In Alberta during the nineties we privatised government registration services. Anybody could open a registry office and process government documents (health care cards, drivers licenses, vehicle registration, traffic infractions etc.) Now, there are registry agents all over the place. They are not limited to business hours, and I have never once had to wait in line. Often insurance agents and car dealerships will also offer registry services, so you don't have to make two stops. It's great, way better than when the government did it and you'd have one or two offices in the city to go to that were only open 10-4 M-F, and you'd have to take the morning or afternoon off work just to wait in line.

I waited for over an hour for my luggage at a private airport the other day (Lisbon). When another passenger complained to a staff member, they were told "if you want to complain, by the time you are done with that, the luggage will have probably arrived; so I suggest you just wait."

Having said that, though, the airport is much better since it turned private as they no longer provide the dubious public service of making it feel overcrowded. I wish I was joking: the previous government argued that the airport was too crowded and a new needed to be built at a large cost to the taxpayer; when it was privatized, suddenly it was possible to expand the existing one in less than a year, at 1% of the cost of a new airport and there are many more flights, cheaper ones and the airport feels larger. I am pretty sure that the previous government didn't pressure the, at the time public, airport management to make it work any better than it did.

Perhaps in a few years, they'll even figure out baggage handling. It was awfully bad before too (like many frequent travelers to Lisbon, I have learned to try hard to avoid check-in luggage, but sometimes it's impossible).

*

With public services, once the straight-forward polite approach fails, I find that switching to an overly-polite forcefulness, perhaps coupled with a few overt displays of education and class to work best.

I'm pretty sure that Paul Krugman can do the same shtick. Plus, he's a celebrity NYT writer, I'm sure he gets excellent public services if he really wants them.

Peter Gerdes writes:

Isn't the obvious problem that things like the DMV don't actually provide their value to the customer but to the public at large by denying potentially dangerous drivers a license.

Private companies would achieve competitive advantage by lowering standards. Sure, you might try and prevent this problem by insisting on standardized tests with standard grading but private companies could simply make sure it was easy to cheat on the tests. Actual road driving tests are an even harder problem as they are subjective and virtually impossible to monitor or standardize.

Sure, you could privatize these services and try to create some new government agency to enforce standards but that might generate even more waste.

Mike W writes:

Scott Sumner writes: "Mike, The profit motive."

That actually doesn't address my question. You said, "Government brings out the worst in us, and competition brings out the best in us."

I get that, but I don't see how the "profit motive" without competition...as in the examples you gave...provides a constraint on inefficiency or rude behavior.

ColoComment writes:

Similar to AntiSchiff's experience, at the Larimer County CO, DMV you simply take a number, take a seat, and watch the number-counter-downer flip from one number to the next. They have plenty of service agents and the wait is generally short.

You can also renew license & MV registrations online. My only beef with that is the 2% charge fee on the total amount, with no cap. When registering my motor home I made a point of going in and presenting a check to save me the inordinate fee. When I mentioned the fee issue to the service agent, she commiserated and said she didn't know why it had to be like that....

Our county clerk is all about customer service, streamlining processes, and a pleasant experience. I've registered vehcles, renewed DLs, and worked as an election judge, and have never experienced an attitude from county personnel other than a smile and a, "How may I help you?"

Andrew M writes:

I've long wondered at the schizophrenic attitude of liberal academics regarding the quality of public schools. On the one hand, they think public schools are a wonderful democratic institution, often send their kids to them, and tell you how good certain teachers are--very much in the spirit of Krugman's anecdotes. On the other hand, they complain incessantly (and rightly, I should add) about how poorly educated ("badly prepared") the freshmen that they teach are--even though (at my school and very many others) almost all the freshmen are products of public schools.

There is no formal contradiction here, of course; and if pushed they will say that, to the extent that the public schools are bad, it's solely because they are underfunded (though they have no independent evidence that this is so; it's a purely ad hoc hypothesis for them). But there is still a tension, between their official theory and the evidence of their professional lives, which they have to mitigate somehow.

Joe writes:

Scott and Krugman can both be right in this case... The rank and file of any organization generally use poor arguments in what is often coicedentally right.

While their are good arguments against say government involvement in public transportation, when it comes to the actual political debate the good arguments are ignored in favor of

gov is bad because gov gov is bad, segway into story story about living in small town rural america apple pie america is exceptional QED government is bad.

ThomasH writes:

Scott,

Indeed, I have been fortunate. I was audited by the nicest IRS guy you could imagine. He seemed sort of apologetic, giving me the idea that my name had been spit out by some program but his common sense told him I was not a cheat. Now I can't say that represents "good" IRS management, but it wasn't unpleasant, ex post. Ex ante I was of course terrified. :)

I'm all for looking into privatizing certain government activities -- TSA remains my favorite, mainly for Khodge's reasons: it would be more likely to innovate new ways of doing security -- but I don't start with the assumption that just anything should be privatized.

Scott Sumner writes:

Kailer, Good example.

Luis, I took a government airline to the Azores last year, and it was the worst airline I've ever flown. On the other hand Singapore Air is government owned, (but not protected from competition.)

Peter, Maybe not road tests. But see Kailer's comment.

Mike. It's simple. The boss wants to get rich. He tells his employees to be nice or they get fired.

Andrew, Good point.

Thomas, You said;

"I don't start with the assumption that just anything should be privatized."

I do. I assume the private sector is best, unless you can demonstrate otherwise. I'm open to evidence, but I don't see much, at least for most government activities--there are exceptions of course.

Justin writes:

I few weeks ago I mailed a package at the USPS and I took a picture of the address with my phone for my records. I was then yelled at by the person behind the desk who pointed to a sign which said no cameras and the security guard rushed over to me and demanded that I put my phone away.

I'm guessing Krugman thinks this sort of thing happens at UPS and FedEx?

A writes:

I'm a little surprised at all the positive anecdotes in the comments. Not because they exist, but because people think they matter. Of course there are intelligent and friendly individuals in government. There is also a substantial majority of decent and non-racist police. But if consumers are systematically inhibited from recourse when things go wrong, then you get some silly behavior.

Instead of thinking about how nice the TSA staff were at the Denver airport, think about what you would do if you had to stop at Newark? Spoiler: you stew.

ChrisA writes:

The reason that companies provide better service (usually) than Government is that companies that provide bad service go out of business as people go elsewhere, not that the owners of such businesses want to get rich. Thus the problem with airports, which whether private or Government, generally provide worse service than in general because they have local monopolies and usually can't go out of business. So making an airport private usually won't improve the service there. Dubai airport and Singapore Airports are good examples of airports that have to compete, they are in the long haul market and there are many airports that could be used instead.

Mike W writes:

Scott Sumner writes: "Mike. It's simple. The boss wants to get rich. He tells his employees to be nice or they get fired."

Nope. What ChrisA wrote.

An example is the oft cited cable companies. During the time their service was the probably the worst...back when customers waited all day for an installer and almost that long to speak to a customer service rep...the cable companies were raising their prices 6% a year and getting "rich".

Now, if what you really seem to be saying in your follow-on posts is that some government services should not be performed at all...e.g.,the TSA...or should not be performed by the government...e.g., the Postal Service...or should be contracted out by the government...e.g., the DMV...I would agree completely.

But in the absence of real competition a privatized government service would have no more incentive for efficiency or good customer service than it did when it was a government entity.

Njnnja writes:

I think we want revenue-generating departments, whether meter maids, speeding/red light tickets, or the IRS, to work with the inefficient bureaucratic indifference of the DMV rather than the ruthlessly efficient revenue maximizing approach of Wal Mart.

Cordelia writes:

To experience a bureaucratic nightmare that is simply beyond belief, try contacting your local social security office. My sister is permanently disabled and receives SSDI income. A couple of years ago the Social Security Administration made an error in my sister's records. They included a number for the Waltham MA office that we were instructed to contact with any issues. Here is what happens if you call the Waltham office: 9 times out of 10 they do not answer. If you are patient and wait for 20 minutes, your call is simply cut off. If you leave a message, they do not call you back. If you try 10 times to reach them and finally succeed, you will get a general number who will give you an extension for the specific person supposed to be handling your case. No one will answer at the extension. Try leaving a message...they will not answer. Try calling multiple times (you still have to get through the impossible phone tree), you still can't reach them. Leave additional messages over a period of months, they never respond. Try calling the national office... Same sort of trouble getting through. When you do get through, they can't help you...because it has to be handled through your local office. The error remains uncorrected to this day.

Pajser writes:

Scott: "Are you aware of the principal-agent problem?"

Yes. But it seems it is already solved in harder cases. The politicians or judges have strong incentive to accept bribe, yet in many countries, they rarely do. The politicians have little incentive to keep public employees rough. In practice, I've seen many times that public employees are very nice.

AS writes:

Krugman does understand why government services are bad, he just doesn't want to admit it because it would weaken his established position as seeking to expand the powers of the federal government, giving more top-down control and readership to economists like himself. It's actually a brilliant ploy. Making ridiculous claims such as this one also gets opposing economists to spend time recognizing and debunking them.

Floccina writes:

I worked for government for a while when I was in college and it was incredible how little work the Government employees did. So that is the other side.

Nick writes:

I don't understand the parking tickets part. If we had privatized, for profit meter maids the parking rules would be transparent and we would all rarely get tickets when only in violation of the letter of the law? I'm extremely skeptical...
The DMV seems to serve no purpose, especially since we force people to obtain private insurance and presumably this would be difficult for people with no idea how to drive. If we privatized it and incentived cost cutting, likely the institution would be gutted, wither into nothing, and this would also likely be a good thing. But they wouldn't replace the dmv's services with some streamlined dream experience. we could just go ahead and eliminate it entirely and skip the super corrupt public - private cooperation phase.

Moebius Street writes:

I'd like to add just one anecdote. After my wife and I were married, she needed to get a green card. This involves multiple painful trips to Immigration, in our case to Federal Plaza in NYC.

On one of these trips, the clerk at the counter was being characteristically stubborn, and my wife asked if she could speak to a manager. In the private sphere, this is something that would likely annoy the clerk, but would be a perfectly reasonable thing to do. But when my wife made this request at Immigration, the clerk pushed a button, and two big, burly guys came out to escort my wife out of the building.

When the government is providing a service that you're required to use, it has zero incentive to work in a reasonable fashion. The clerk in my anecdote is certainly not compensated based on customer satisfaction scores, and more likely than not, it's based on the number of forms she can shuffle through in a day.

Anand writes:

To add to the anecdotes, some "Third World" experience (from India):

I am old enough to remember government offices in India to be extremely rude. This is assuming that they were even present, a lot of the time the guy in charge was absent. It has improved a lot in my lifetime.

Generally private services were/are a lot "nicer", but also more expensive.

Since India has become much richer in my lifetime, I see it more as a case of "you get what you pay for", rather than anything inherent in public or private sector, though this does play some part.

Leaving aside personal niceness, (which is important, but not everyone's priority), one also has to take into account various other factors. Some private services are priced outside the range of some people, so govt. is there to provide some sort of backup. There are various other issues, but that would go too far aside.

W. Peden writes:

As Hayek pointed out in the Road to Serfdom (which I re-read recently and which always rewards another read) a private monopoly for which the state is an umpire rather than a participant is preferable to having the state as a player and the umpire. There's a reason why football players aren't allowed to referee their own games!

In the UK, the Conservative party proposed privatizing the DVLA (our equivalent of the DMV) in the 2005 election, but lost. I think they also used to be in favour of privatizing the London Underground and introducing school vouchers.

(As fans of "A Fish Called Wanda" know, the London Underground is the London subway system, not a political movement.)

Scott Sumner writes:

Mike, demand curves slope downwards, even demand curves facing monopolies.

I've had problems with cable TV, but nowhere near the problems I faced with government bureaucrats.

Pajser, If the P/A problem is solved, then why are government services so horrible?

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