There’s something of a hunt going on for sources of possible growth in the British economy. The usual suspects are insisting that if government just borrowed more, taxed more and spent more, then all would be copacetic. As Jeremy Warner points out, with debt now running at over 100% of GDP, and taxation as high as it ever has been in peacetime, more intervention might not be a viable solution. Another Thatcherite Revolution is thus required.
However, it’s worth thinking through what actually is wrong this time. It’s not that government is trying to run too many industries, because it doesn’t. So privatisation isn’t going to work. Well, selling off what government does badly will but this time around that’s not an economy level solution. It’s also not entirely true that taxation itself is the major problem. The actual problem is that government will not allow any bugger to actually do anything.
We have, to adapt a Douglas Adams idea, passed the Administration Event Horizon. All effort is now spent in administering attempts to do things, and none at all in actually doing something. When the inquiry into a Thames tunnel – just the inquiry on its own – now costs more than Norway spent in total on building a tunnel, it is obvious that the event has happened. We are sinking into the black hole of administration rather than getting on with the job of making our lives better.
Our problem is that administration of everything – the bureaucracy – stymies any attempt at doing anything. Which means that we have to turn to an earlier guru, an earlier analyst, to work out what to do. Enter C Northcote Parkinson. Parkinson’s Law is remembered as: ‘Work expands to fill the time available for its completion’. That’s true, but not the point of the great man’s work. Rather, he analysed bureaucracy itself.
The first problem with bureaucracy is that there’s no way to measure the output. This is something we recognise in how we calculate GDP – we can’t measure the output, so the civil service goes into the GDP books as the cost to us of having the civil service. Normal market economic efforts are measured at the value added. As it’s incomprehensible to even imagine bureaucracy adding value, we don’t try, we just laughably claim the addition is equal to the cost.
As Parkinson goes on, since there is no measurable output possible, the signifiers of success must differ. In a bureaucracy, those will be growth in headcount and growth in budget. They are measurable, as value add is not, therefore those are the things that get measured and by which success is judged.
One of his examples is that, soon enough, the Royal Navy will have more admirals than ships – something achieved within a decade of publication if memory serves. He then goes on to project to the absurd, where there will be more bureaucrats in the Ministry of Defence than there are soldiers or sailors. We powered through that a number of decades back. We even bought £1,000 chairs for each of the bureaucrats while whining that it cost £2 a day to feed a Corporal. That last being particularly odd as their natural diet is recruits.
It is indeed true that ‘Parkinson’s Law’ is only one of the three essential management books (‘Up the Organisation’ and ‘The Peter Principle’ round out the trio) but the lesson here about bureaucracy needs to be learnt.
Bureaucracy will expand into any and every economic space it is able to. Therefore, the job of any manager is to slash away, always and unrelentingly, at the growth of the bureaucracy. Yes, obviously, it’s like Japanese knotweed, you never get rid of it nor the impulse for expansion. The best that can be done is to keep it under some sort of control.
Note that this applies to all organisations. An advantage of the free market and capitalist sector of the economy is that when the parasite takes over the host, the organisation goes bankrupt and the parasite dies too. This is not necessarily true of those less subjected to market forces – there’s many a charity that spends 80% of money raised on administering the raising of money.
With government, there’s even less of a useful feedback loop. ‘Yes Minister’ has it right that the point of the game is to administer, not to do anything.
So, what is the actual job of a minister? As with a manager in the private – and measurable – sector, they have to fight that constant battle against the bureaucracy. That creation of administrativium into which our wallets all sink.
Sadly, the Carthaginian Solution – raze the buildings to the ground, plough the land with salt, sell the population into bondage – doesn’t work these days. Who would buy ex-bureaucrats after all? But the task still exists.
What ails the British economy is too many people administering what may not be done. Slash away at that. Take off and dust it from orbit.
Hey, it could even be electorally successful. Jobsworths have never been popular among the British so the elimination of Clipboard Man could be one of those rallying cries that works.
We need action – and fast.
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