Cutting Government by Rules of Thumb

Over at the Admin Smith Institute Blog Dr Eamonn Butler has a short paper “Rebooting Government”. Just six pages long it looks at short, medium and long-term measures to reduce the deficit and keep it low. Well worth a read.

However, in evaluating what governments should do I advocate more general rules of thumb.

  1. Proportionality. Rather than trying to evaluate the relative worth of policies, try to see if the cost is anything like proportional to the benefit. That is a quick analysis to cull those policies where costs vastly exceed the benefits.
  2. Despinification of government. Cull those policies or regulations that where introduced as knee-jerk reactions, or on the basis of “research” that was discredited. This may include changing the language of government, with reports stating conclusions clearly and how they were reached, not waffling on for pages but saying nothing of substance.
  3. Temporal diminishing returns. Many initiatives have some initial benefits or successes, but later those benefits diminish for various reasons. (Not to be confused with diminishing returns to scale). The initial effects wear off. The organisation solidifies, the most needy processed first, or people get used to, or by-pass the intiative. Much the same way shock adverts only work being more graphic than the last one, or congestion charging only reduces traffic until people can adjust their budgets to afford the extra cost.
  4. Changing from direct provider to provision enabler. For instance, from providing schools to providing education vouchers (with many shades in-between).
  5. From detailed management to general objectives. A failure of government has been conformity to detailed standards by form-filling and inspections, whilst failing in the bigger picture. Social Services Departments, or General Hospitals that fall significantly shortly after having scored highly in performance evaluations. Or regulators who missed banks failing, despite receiving detailed and regular information about their operations.
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