That's the result of "lack of neoliberalism", which is about efficient market-based solutions. Of course it turns out that just as socialism neoliberalism also tends to fall into a pathological state (regulatory capture, oligopolies, etc).
In the end these labels are pretty useless, the underlying problem is pretty easy to describe, is the system sufficiently just and cost effective or not. It doesn't really matter if it's market-based or it's done through some magic lottery system.
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That said, services are suffering from cost disease big time. Healthcare and education badly needs productivity increases, otherwise quality has to drop to get back to sustainable funding levels.
