In fact, much of what’s called “public” is increasingly a private good paid for by users — ever-higher tolls on public highways and public bridges, higher tuitions at so-called public universities, higher admission fees at public parks and public museums.
Much of the rest of what’s considered “public” has become so shoddy that those who can afford to do so find private alternatives. As public schools deteriorate, the upper-middle class and wealthy send their kids to private ones. As public pools and playgrounds decay, the better-off buy memberships in private tennis and swimming clubs. As public hospitals decline, the well-off pay premium rates for private care.
Gated communities and office parks now come with their own manicured lawns and walkways, security guards and backup power systems.
Why the decline of public institutions? The financial squeeze on government at all levels since 2008 explains only part of it.
The slide really started more than three decades ago with so-called “tax revolts” by a middle class whose earnings had stopped advancing even though the economy continued to grow. Most families still wanted good public services and institutions but could no longer afford the tab.
Since the late 1970s, almost all the gains from growth have gone to the top. But as the upper-middle class and the rich began shifting to private institutions, they withdrew political support for public ones.
In consequence, their marginal tax rates dropped — setting off a vicious cycle of diminishing revenues and deteriorating quality, spurring more flight from public institutions.
Tax revenues from corporations also dropped as big companies went global — keeping their profits overseas and their tax bills to a minimum.
But that’s not the whole story. America no longer values public goods as we did decades ago.