Bloomberg says that the private sector isn't any better than the public sector.
The Mayor of New York City on Starting His Business from Etsy on Vimeo.
Related: How much should a judge earn a year? Good snark from Andrew Gelman.
Matt Yglesias shows how badly the recession has hit the public sphere.
Apt. 11d 
I can not get the video from here. But, for some functions the private sector is better than the public sector. Socialized agriculture, small retail, restraunts, and repair services all had a really dismal record in places like the USSR, China and Cuba. On the other hand socialized medicine and education seems to work pretty well in places like the UK and even Ghana. I have a recent post up favorably comparing Ghana’s health care system to the US.
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I forget the exact phrasing, but Hayek says somewhere that authoritarian regimes usually have one or two show pieces, while everything else is the pits. The Nazis had the Autobahn, the Soviets had their space program, etc. I think Soviet education was mostly pretty good.
Education is an interesting example, because there’s been some research on private schools for the poor in the 3rd world. Here’s a post that’s worth reading all the way:
Ghana is one of the examples given of places where the private schools for the poor work better than the public ones. The problem in many of the locations studied is that in the public system, the government teaching jobs are regarded as a patronage deal, and the teachers collect their salaries and often don’t show up. Meanwhile, in the private sector, the teachers won’t get paid unless they are actually in school and working to the satisfaction of their clients (their students’ parents).
I’m not sure exactly why there is such a big discrepancy between haphazardly managed 3rd world public schools and the rigors of the Soviet school system. Here are a few guesses. 1) The Soviets really did want a strong educational system to train engineers, run their space program, and build bombs. 2) There was a strong pre-existing elite educational system to build on. 3) Elite Russian culture is pretty cerebral and puts a lot of value on education. I suspect that you might find a lot more convergence between the 2nd and 3rd world in the less developed parts of the Soviet Union. Solzhenitsyn was a math and science teacher in exile in one of the -stans after his time in the labor camps, and I believe he mentions that students were guaranteed graduation if they donated a sheep to the school. Similarly, I remember being told by a Russian that in Georgia, it is traditional to give diplomas (including medical degrees) as gifts. That may or may not have been an unfair accusation.
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