With the nation’s capitol frozen to a halt, now would be a good time for members of Congress to cozy up to their computers and review some economics 101-maybe then they’d reconsider passing a second stimulus package that threatens to put the economy in the deep-freeze, too. A new video from the Center for Freedom and Prosperity Foundation shows why federal and state government monopolies are bad, resulting in higher prices and shoddy service. Izzy Santa of the Cato Institute comes up with several examples, including the post office, Amtrak, Fannie Mae and Freddie Mac, health insurance, cable TV, and even state-run liquor stores. “The most tragic example, though, of government monopoly” says Ms. Santa, “is in education.” Private schools get better results for a fraction of the price because if they don’t get results, they lose tuition when students leave. In contrast, government-run schools get more money if their students don’t perform. The difference is that private schools have to compete for students, whereas government-run schools have a captive audience. Ms. Santa also reminds viewers that teachers in government-run schools are much more likely to send their own children to private schools. So, too, are politicians-many of whom routinely vote against parental options in education. “That really tells us all we need to know,” concludes Ms. Santa. Yes, it certainly does.
