First, you assume that taxation primarily funds the services you actually see. It doesn't. It funds many things that you would disagree with vehemently.

As is the problem with government.

Second, you assume that the state, which is an organization, is remotely efficient. The state has no incentive or pressure to make it efficient. It is abhorrently inefficient. It is the epitome of the principal--agent problem, where people spend someone else's money, but in a rather unique circumstance, these people have the legitimacy of armed enforcement behind them preventing dissenters from critiquing their usage of someone else's money too loudly.

I've worked in Private, Third and Public sector in several jobs and ran my own businesses, private sector is every bit as inefficient as public sector they just treat their staff worse to compensate for it and in more recent times they don't become more profitable, they artificially boost profits for a few years by cutting costs then the product becomes so horrendously watered down the company dies a slow death.

The motivation in public sector was behind the service you provide and the fact the job was well rewarded. Which has all changed now due to public sector cuts - no doubt a tactic used that when the services suffer the current tory government can privatise it all and make a killing short term.

And finally, we have irrefutable historical examples that have shown clearly that market based methods are more effective than traditional methods. An example is cap-and-trade regulation on business. Left-wingers often criticize it for allowing businesses who pollute to purchase credits for pollution on the open market, but the reality is that creating that market is precisely why businesses choose not to pollute because they want to be able to sell those credits. It is the most successful form of environmental regulation ever. The traditional method would have been a tax on emissions.

Except manufacturing overseas has become highly popular due to it's low cost no doubt helped by the fact there is no environmental regulation so companies have chosen to offshore their manufacturing.