The real chink in the public option armor

The public option in the healthcare reform is a wonderful opportunity to argue--from a political philosophy perspective--the appropriate role for market and state.  One argument is about the efficient market hypothesis.  But, that to me is far less exciting than what Heather Mac Donald has articulated:

Well, then, why not have private providers compete with government across the entire range of government services?  Maybe the supporters of actual market-based competition in health care could offer the following deal:  We’ll give you your health care public option, now open garbage collection, road-building, transit operations, mail delivery, parks maintenance, education, sewage treatment, prison management, inter alia, to private sector competition, and let the most efficient player win.

So, in one sense, Democrats have provided the opening that Republicans have always been pushing for--think school vouchers, for instance.  How is philosophically a debate on school vouchers any different from this whole public option issue in healthcare? 
Strictly from such a perspective, this debate could be the most influential since Bill Clinton's statement on the end of the era of big government.  How odd then that Democratic presidents are the ones to preside over such discussions?  And how much more bizarre that Republicans are dozing through this opportunity?

FWIW, I am neither a D nor a R :-)