TCS Daily

An Empowered World

By Eamonn Butler - April 21, 2003 12:00 AM

Poor villages in Thailand have found a great way to improve their lives and make a little money. They generate electricity using micro-hydroelectric equipment, and then sell on any surplus to neighbouring settlements. Instead of waiting for the state-sponsored electricity grid to get to them, they're doing it themselves.

Scotland has found a winning formula for keeping its rivers unpolluted and full of wild salmon. Rather than rely on public ownership and government clean-up schemes, fishing rights are bought and sold. So the owners have a powerful incentive to make sure that streams are kept clean and well-stocked.

Want to cut traffic congestion? Simple. Make motorists pay to use the road at peak periods. Then those who can avoid the peaks will do so, more people will ride on public transport, and cash will be generated for environmental improvements, as cities such as London, Oslo, Singapore and many more are finding out.

Entrepreneurs in Southern Africa have some up with an effective way of saving endangered species such as elephant and rhino. Charge rich tourists to shoot them. Then, instead of the locals wanting to get rid of them as dangerous pests, they become a source of value to everyone - and are thriving as a result.

The connection?

In countries rich and poor around the globe, people are coming up with all sorts of ingenious ways to run things better than governments can. Choice, competition, and individual enterprise can deliver things quicker, better, and cheaper than state bureaucracies.

And that even goes for essential services that many people just assume have to be delivered by government.

Prisons? Where's the problem? In countries including Australia, the US, and the United Kingdom, prisons are often privately built and managed. As a result, they're built quicker and cheaper, provide prisoners with better healthcare and education, suffer fewer assaults on staff, and lower rates of recidivism on release.

Pensions? Chile led the way with a pension system based on individual accounts to replace the corrupt tax-financed, pay-as-you-go system in which politicians made promises that they could never truly deliver on.

Postal services? Finland, Germany, Sweden, Netherlands, the UK, New Zealand and others have all opened up their state letter monopolies to competition, giving people a choice and, in some cases, a much cheaper postal service.

Schools? In Brazil there are several firms running chains of branded, private schools. There are more in South Africa and Romania. The same in India, where there is even a chain of technology-based schools, complete with its own distance-learning TV station. And private universities thrive in Argentina, Thailand, Russia, and the UK.

Technology is a key driver in this. It enables people to do, on a human scale, many things that hitherto were possible only on a huge government-size scale. It has enabled the state monopolies of broadcasting, telephones, healthcare, education and utilities to be broken down and delivered more locally and more entrepreneurially.

But simple incentives are key, too.

If you give people the freedom to come up with new ideas, you'll be surprised just how they do. From the owner-drivers of shared taxis and minibus services in Manila, Buenos Aires, Ankara, Nairobi, to the small farmers in China and Vietnam who are producing far more than the state collectives ever did, to the artisans in Italy's unregulated small-enterprise sector - ideas and entrepreneurship spring up as soon as big government steps out of the sunlight.

Dr Eamonn Butler is Director of the Adam Smith Institute, London. The Institute is collecting ideas for innovative initiatives like those described above. You can find them in a new website.

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