> The only counterexample I can think of is elite private schools, which do cost more than public universities, but I think that it’s safe to assume that Yale provides rather different kind of service than University of Kansas. But, if you think that government-ran enterprises in US are cheaper than for-profit ones, I’m eager to hear some examples.

Medicare is a blindingly obvious one. Trains. The postal service. Can you actually cite a real example of the private alternative saving money, especially one that didn't involve drastically cutting services?

I also don't think it's "safe to assume" that Yale does much different from the University of Kansas except let you go to school with the kind of people who attend Yale.

> This pattern is also logically expected: for profit companies are incentivized to keep costs low, while government ones much less so. It’s not like citizen can easily choose to change the government they are signed up with for a cheaper, better run one.

No, that is not logically expected, because the entire concept of "profit" is collecting extra money on top of the cost to actually render the service.

> Imagine an alternative scheme, where government agrees to buy 1000 prisoner-years worth of capacity, and then is free to send as many prisoners as it wants between 0 and 1000. There is no prisoner quota, prison company is paid exactly the same amount regardless of whether it houses 100 or 1000 inmates. Would that arrangement be more acceptable to you?

That doesn't really solve the problem; your incentive is still to get there to be so many inmates that there's no choice but to fund a new facility.