- - Wednesday, January 21, 2015


In his book, “Myths, Lies and Downright Stupidity,” John Stossel of Fox News bet his readers a thousand dollars that they couldn’t name one thing the government does better than the private sector. Eight years later he hasn’t had to pay anyone a dime. The government just doesn’t have the motivation, or the spur of competition, to perform services as well as private business.

“If private companies don’t do things efficiently,” Mr. Stossel correctly observes, “they lose money and die.” Government, backed by force if not quite majesty, can merely ask the taxpayers for more money to bail out its incompetence.

This is common sense, but government bureaucrats are often deaf to the message everyone else hears clearly. Earlier this month, the Business Coalition for Fair Competition, a coalition of trade associations, businesses, and organizations dedicated to free enterprise, released a list of the top-10 most egregious examples of unfair government competition with private business over the past year. The examples are dramatic and revealing.

The New York State Department of Environmental Conservation, for example, contracted with the U.S. Department of Agriculture to kill wild pigs at a cost of $10,000 per pig. Razorbacks are tough critters, but this project in pork is exposed as particularly outlandish because hunters and commercial pest removal companies are happy to eradicate the hogs for a fraction of that.

Virginia Tech, an organ of the government after all, hired a bicycle mechanic and opened its own bike repair shop in Blacksburg to compete with several local mom-and-pop bicycle repair shops. The town of Bethany Beach, Delaware, wanted to take over a private, small beach concession shop and get in the business of renting beach chairs and umbrellas before wiser heads at City Hall realized that this was a dumb idea. The town changed its mind.

Though examples of the government getting into the marketplace when it shouldn’t are common, more and more government leaders understand that private businesses are the best hope for providing quality services at reasonable prices.

Golf courses are a good example. Many communities across America have government-owned golf courses that compete against privately owned courses. The government courses are usually inferior to private courses, and are costly to maintain besides. Wiser governments put the management of government courses out to private management companies and the governments, like the golfers, are pleased with the change.

City-owned courses in Tucson, Arizona, lost $8 million annually until the city council had enough and turned operations over to a private management firm. Phoenix followed suit, saving $2.4 million a year by enabling a private company to take over the operations of five city courses. Morris County in New Jersey, and the city of St. Paul, Minnesota, saved hundreds of thousands of dollars annually by getting out of the golf business.

The government-owned Potawatomi Zoo in South Bend, Indiana, is now managed by a nonprofit that has reduced costs and increased revenue through appeals to private donors, philanthropic organizations and business firms. In 2012, the state of Washington got out of the liquor trade and enabled private businessmen to sell booze. Louisiana is privatizing its state-run hospital system. New Jersey saved nearly $7.5 million by contracting toll collection efforts on the Atlantic City Expressway to a private company.

Good business pays. Bureaucracy costs. That’s fundamental economics.

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