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Basically, the best argument in favor of privatization is that the school is a company no different from any other. There is no incentive to do better under the current system, because you will not lose your customer base. Private schools at this point are not a real threat to the public school system, because people will not pay for what they can get for free (so they believe), even if the free product is inferior.

A superintendant, a principal, or a teacher faces no monetary disincentive for a nonproductive school. A proprietor, however, will see his own livelihood suffer if his customers leave and go elsewhere. He will motivate his workers with the incetives of higher salaries and bonuses, made available by an expanding customer base that results from people seeking a superior product.

It's the same principle that explains the economies of Soviet Russia...businesses were taken out of the hands of the people who had a real stake in them, i.e., their owners, and placed in the hands of disinterested, appointed third parties. Consequently, we were able to trounce Soviet Russia economically during the 20th century, because our people and factories produced superior products and made the most of the resources available. People had a personal interest in the businesses, because they were their own, and they knew that making them the best they could be would result in a higher standard of living for themselves.

Other than the satisfaction of a job well done, what incentive does a principal, or a teacher, for that matter, have to take a school from mediocrity to greatness? The principal does not get a bonus for administering a School of Excellence. He does not get docked for floundering test scores. The status quo, therefore, remains. You can't just rely on people to be good people for the sake of others. Altruism is fleeting, and that's why its bad...you can't depend on it being there when you need it most, and it requires that people give of themselves with no guarantee of receiving an equal or agreed-upon benefit in return (Read anything by Ayn Rand, if you haven't. Preferably, "The Virtue of Selfishness").

But, personal incentives such as monetary profit (a bad word in today's society) are constant...everyone needs money to eat, money to shelter themselves, money to transport themselves, etc. Even if they have enough to get by, they always want more. And, if your money depends on the quality of the work, then the quality of the work improves.

The schools that produce an inferior product (poorly educated students) will automatically be forced out of existence because too few students will populate them. Too little funding will ensure that they close. The best and brightest teachers will be hired at the best schools, which will pay them more, because they will have a larger customer base, and consequently, greater profit.

This is the whole priciple that made America great and allowed her to lead the world during the twentieth century, but somehow that concept has been missed by our lawmakers.