In the 'world of truth' [ie markets] ... such disasters [as the Mao-induced famine in China that killed from 10 million to 60 million people] cannot happen. Mistakes, certainly, will be made - perhaps more frequently than under central planning. But the mistakes stay small; in market economies we call them 'experiments'. Tim Harford, The Undercover Economist, page 237Spending time in provincial England is a reminder of just how bleak life can be when government fails. The physicial infrastructure of cities is very much a government creation, as is an education system driven by ideology. Government thought it knew best not only what to achieve, but how to achieve it. The intentions were good, the execution has been disastrous.
A Social Policy Bond regime would play to government's strengths: articulating what society wants and raising the revenue to finance achievement. But it would contract out to the market that process which the market does best: ensuring that scarce resources generate the maximum return to the taxpayer's dollar. Government would decide what to do; the private sector would decide how to do it.
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