Philosophy

Markets are not perfect, and they cannot solve every problem. But they are extremely powerful and when governments reshape them to serve a public purpose, they can have a tremendous impact.

--David Osborne, "Ten Ways to Turn D.C. Around,"
The Washington Post Magazine, 12/19/90

Governments have two primary methods for solving problems.

Require or prohibit specific behavior.
Create economic incentives to encourage or discourage specific behavior.

Although requirements & prohibitions are often necessary, they have some drawbacks:

People must know that these requirements and prohibitions exist;
People must read and understand them;
People must comply with them; and
Government must hire staff to monitor and enforce compliance.

Economic incentives have the following advantages:

If economic incentives are aligned with public policy objectives, people's desire to save money and avoid taxes and fees will enlist the private sector’s energy around the clock to effectuate a public purpose;
Effectiveness is not diminished if people do not understand or agree with the underlying policy; and
Because people are almost always motivated to save money, economic incentives are self-enforcing and rarely require any separate enforcement effort.