My pet theory is it's for the same reason public and public-ish housing works better everywhere else (from Vienna and Singapore to even ex-USSR) - robust privat

My pet theory is it's for the same reason public and public-ish housing works better everywhere else (from Vienna and Singapore to even ex-USSR) - robust private sector, in jobs and housing. In other places the alternatives may be limited/very expensive/not much better, so the public housing/jobs retain a mix of all kinds of people. I think in Singapore they used to emphasize luring the best people into government jobs, even; not sure how well it works in practice in the long term. In the USA, private sector can provide much better housing, and much better jobs, for most people, so anyone capable of leaving the public ones does. So, public housing eventually becomes dominated by the least functional members of society, and public sector, with the exception of the idealists and the corrupt, mostly retains the incompetents. The process is self-perpetuating too. Govt aside, in a tech company it's really hard to maintain a semi-crappy department given that people can leave - either it needs to be cleaned up and fixed, or the best developers will leave and it will just become crappy.