Surely if the roads are funded by townships or regions it's no different to the current system (i.e. it would need to be funded from some kind of regional tax,

Surely if the roads are funded by townships or regions it's no different to the current system (i.e. it would need to be funded from some kind of regional tax, rather than a federal or statewide tax as it is now). I think roads are often used because they're a good example of something which seems to be a natural monopoly, where many people find a libertarian treatment lacking. I'm skeptical about the viability of a donation system for anything, but as it's never been done in practice, it's hard to have much meaningful discussion about it. It's worth noting that even Friedman thinks the government should fund education (and believes in some form of accreditation at least for teachers) (http://www.schoolchoices.org/roo/fried1.htm http://www.schoolchoices.org/roo/fried1.htm)