On June 2, Zia Yusuf, the Chairman of Reform UK, tweeted that a UK version of DOGE – the Department of Government Efficiency – had been launched. Promising an ‘Elon Musk-style’ slashing of government waste, the initiative echoes the American attempt to apply Silicon Valley’s business mindset to the public sector. Now, with Musk stepping away from his informal advisory role in the Trump administration, it’s worth evaluating what DOGE actually achieved – and why it failed to deliver on its bold promises.
The US DOGE aimed to cut $2 trillion in government spending. In practice, it only achieved reductions of around $170 billion –just 8.5% of its target. Why did the DOGE turn out to be inefficient itself?
The answer lies in the Austrian economist Ludwig von Mises’ slim but enduringly relevant book ‘Bureaucracy’ (1944), which offers a fundamental insight: you cannot run government like a business.
Government is not a business
The core flaw of the DOGE mindset isn’t its goal – reducing state waste is commendable – but its logic. The methods that improve private sector efficiency don’t translate to government. As Mises put it:
Government efficiency and industrial efficiency are entirely different things. A factory’s management cannot be improved by taking a police department for its model, and a tax collector’s office cannot become more efficient by adopting the methods of a motor-car plant.
The reason is simple: government operates without profit and loss signals. In business, if you produce something inefficiently, the market punishes you – consumers stop buying, competitors overtake you and losses mount. These are the mechanisms by which firms learn, adapt and improve.
Government, by contrast, lacks this feedback loop. There’s no ‘economic calculation’ because services are not provided through voluntary exchange. Public agencies don’t win or lose based on consumer choice, they are funded by compulsory taxation. As Mises argued, this means the government cannot rely on what he called ‘dollar votes’ to measure its success. There is no market test.
Thus, bureaucracy becomes the only rational method for managing government activities. Mises defines it as ‘the method applied in the conduct of administrative affairs the result of which has no cash value on the market’.
Even the most capable entrepreneur, when placed in charge of a government bureau, ceases to be a businessman and becomes a bureaucrat. The constraints of public service are not managerial but institutional. The idea that government can be made more ‘efficient’ in a business sense ignores this fundamental difference.
You can’t just cut people – you must cut functions
It follows, then, that the only true way to improve government is to make it smaller, not just more ‘efficient’. This is where DOGE failed. As Ryan Young of the Competitive Enterprise Institute noted: ‘DOGE failed because they got the order of operations wrong’.
They began by targeting the federal payroll – cutting personnel – before reducing the number or scope of federal agencies. This meant the same bureaucratic apparatus continued to function, just with fewer staff. The result was increased dysfunction, not increased efficiency. Without scaling back what government actually does, trimming headcount is like shrinking a factory floor without changing its output targets. It doesn’t work.
Ignoring the elephant in the room: social security
There’s another danger Reform must avoid: ignoring the largest component of public spending. Both Donald Trump and Nigel Farage have pledged to protect welfare and social security programmes. But in doing so, they render the majority of the budget untouchable – while promising massive cuts elsewhere.
One might assume that a UK version of Trump would slash foreign aid, but this is a relatively minor part of the budget. In the UK, foreign aid is often a political target, yet it accounts for only 0.5% of Gross National Income. By contrast, social security spending makes up 10% of GDP and is projected to rise to 11.6% by 2026–27, according to the Institute for Fiscal Studies. As James Heale recently noted, ‘the welfare state is Nigel Farage’s new battleground’. This is the real fiscal battleground.
If UK DOGE follows the American model – cutting around the edges while leaving the largest areas of spending intact – it risks replicating the same failure.
Efficiency in government cannot be imposed using the metrics of the marketplace. DOGE’s failure was not a problem of willpower, but of misunderstanding the nature of the state. Attempts to make it run ‘like a business’ are bound to fall short unless we address the real issue: the size and scope of government itself.
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